The surge in AI infrastructure demands has led to a complete sell-out of hard drives for the year, with hyperscale companies capturing the entire stock. Leading manufacturers like Seagate and Western Digital report their production capacities have been fully allocated for 2026.

Western Digital CEO revealed orders are booked through 2028 as drive capacities continue to climb, supporting the need for vast data storage in AI and cloud applications. Similarly, Seagate has allocated its nearline storage capabilities through 2026 and is already discussing 2027 orders.

This situation presents challenges for secondary markets and mid-sized enterprises relying on HDDs for server technology, as production prioritizes major cloud clients. The ongoing shortages in memory, storage, and CPUs are further exacerbated by the AI industry’s expansion.

Industry experts warn of tough times ahead for general-purpose servers and enterprise storage due to this dedicated prioritization towards AI-centric usage. Despite these difficulties, top cloud providers are increasing their capital expenditures in infrastructure, indicating elevated demand for server and storage capacities.

Overall, while hyperscale clients secure their storage needs, smaller companies may find themselves grappling with limited availability and rising costs of essential components.