Toshiba said on October 2, 2026, that its manufacturing subsidiary, Toshiba Information Equipment (Philippines), had made the first shipment from an expanded nearline hard drive production line at Laguna Technopark. The company aims to nearly double the subsidiary’s annual production capacity by fiscal 2027 compared with fiscal 2025, measured by storage capacity.
The expansion targets high-capacity drives for data centers, where Toshiba says artificial intelligence and cloud services are increasing storage requirements. It adds production at Laguna Technopark to the company’s existing nearline manufacturing operations at Carmelray Industrial Park.
Expansion measured in storage capacity
Toshiba’s target refers to the total amount of data its annual output can hold. It does not necessarily mean twice as many physical hard drives. The fiscal 2025 baseline is also important when assessing how much additional storage the expansion would bring to market.
On October 5, the Philippine Department of Finance outlined a multibillion-peso investment planned over the following three years. The department said Toshiba’s expansion was expected to generate around 3,000 jobs and increase its nearline hard drive manufacturing capacity in the country.
Finance Secretary Frederick Go met Toshiba executives led by Chief Operating Officer Koji Ikeya to discuss increasing nearline hard drive production. Toshiba said it would continue investing in manufacturing capacity and recruiting and developing engineering and technical staff.
Customers have secured future production
Western Digital and Seagate have described customer commitments extending beyond 2026, providing context for how Toshiba’s expansion could affect the wider hard drive market.
Western Digital Chief Executive Irving Tan said during the company’s January 2026 earnings call that its production for calendar 2026 was effectively sold out, with firm purchase orders from its seven largest customers. He also said two customers had long-term agreements for 2027 and one had an agreement for 2028, covering both storage volumes and prices.
Seagate Chief Executive Dave Mosley said during its July 2026 earnings call that the vast majority of its nearline storage capacity was allocated into calendar 2028 under long-term supply agreements. He said contracts specified product configurations and pricing for all of calendar 2027.
Mosley also said customers were seeking to extend their planning horizons through 2029 and beyond, describing those discussions as evidence of confidence in their long-term infrastructure needs.
Analysts reassess supply and pricing
TD Cowen analyst Krish Sankar estimated in October that Toshiba’s expansion would add about 75 exabytes of supply, compared with an industry shortage of roughly 300 exabytes. He also projected storage demand growth of about 30% annually in 2027 and 2028. Those estimates suggest additional Toshiba output would not, by itself, eliminate the shortfall in his forecast.
Wells Fargo lowered its Western Digital share-price target from $730 to $450 and its Seagate target from $1,180 to $865 in an October 16 note, while retaining Overweight ratings on both. Its analysts continued to expect tight industry supply to support profitability.
UBS also cut its Western Digital target from $525 to $470 while maintaining a Neutral rating. Analyst Timothy Arcuri cited uncertainty over hard drive capacity and future pricing, reflecting the unresolved effect of additional supply on manufacturers’ earnings.
