"Seagate makes HDDs, which are high-capacity drives that are relatively cheap and very efficient for storing large amounts of data. Modern computers run on SSDs and NVME drives, but HDDs are still very much in demand due to how cheap they are for their exceptional capacity."
"Building a hard drive factory takes years, and Seagate's head start has given it a massive moat. When demand exploded in 2025, prices for high-capacity HDDs jumped 60% between November 2025 and February 2026."
"AI companies are no longer limited to text-based AI models and are training on high-quality video and image AI models. These models need significantly more storage for training, and also produce content that requires a lot of storage."
Seagate's stock has increased significantly, with a 93% rise over the past year and a recent 15% surge following strong earnings. The company specializes in high-capacity HDDs, which are essential for storing data used in AI models. Despite the popularity of SSDs, HDDs remain in demand due to their cost-effectiveness. Seagate's established position in the market provides a competitive advantage, and the company has secured contracts that ensure continued growth in the coming years as AI storage needs expand.
Read at 24/7 Wall St.
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