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Western Digital (WDC) Stock Rallies 11% on Bernstein’s Bullish Upgrade to Outperform

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WDC Stock Card

Key Takeaways

  • Bernstein elevated Western Digital to Outperform from Market Perform, raising its price target from $170 to $340.
  • A sharp 21% decline followed concerns about Google’s TurboQuant compression technology — which Bernstein argues poses zero threat to hard drive demand.
  • The firm projects Western Digital and Seagate will achieve combined revenue growth of 24% CAGR between fiscal 2025 and 2030.
  • Western Digital announced an extended timeline for its ePMR technology, potentially indicating a delayed shift to HAMR drives.
  • Seagate remains Bernstein’s preferred stock in the segment, with its price target elevated to $620.

Despite recent volatility, Western Digital maintains a year-to-date gain of approximately 57%, showcasing resilience even through the latest correction.


WDC Stock Card
Western Digital Corporation, WDC

The stock plunge was triggered when Google Research introduced TurboQuant — an advanced compression method designed to optimize KV cache during AI inference operations. Market participants worried this innovation could reduce storage hardware demand.

Bernstein’s Mark Newman firmly rejected this narrative. “There is zero impact to HDD demand,” Newman stated in his research note. He emphasized that TurboQuant’s influence on NAND flash storage, utilized solely for offloading inactive caches, is minimal at best.

According to Bernstein, the market reaction was excessive and unwarranted. Western Digital had tumbled 21% from its recent peak before the analyst’s upgrade. Related companies including Seagate and Sandisk experienced similar pressure.

Upgraded Revenue Projections for Storage Industry

Bernstein has adopted a more constructive stance on the broader storage industry. The research firm now forecasts that Western Digital and Seagate will achieve a combined revenue compound annual growth rate of 24% spanning fiscal years 2025 through 2030.

This represents a substantial upgrade from earlier projections that anticipated 18.7% bits growth accompanied by 3.6% annual price erosion. The updated model incorporates 24% bits expansion with pricing holding steady.

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Newman pointed to several structural growth drivers: expanding AI computational workloads, increasingly sophisticated content production, extended data retention requirements, and strengthening data sovereignty regulations that support both volume growth and pricing power.

Regarding product developments, Western Digital’s 2026 Innovation Day revealed plans to extend its ePMR technology roadmap. The company essentially prolonged the lifecycle of its existing drive architecture by one to two additional years beyond prior expectations.

Questions About HAMR Rollout Timeline

The upgrade contains an important qualification. Newman interprets Western Digital’s continued emphasis on ePMR as an implicit indication that the company’s migration to heat-assisted magnetic recording — commonly referred to as HAMR — might be progressing slower than initially anticipated.

Bernstein’s financial model anticipates Western Digital will begin scaling HAMR production in 2027, representing approximately 5% of nearline exabyte shipments during that year.

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This contrasts sharply with Seagate’s trajectory, where Bernstein projects roughly 70% of nearline volume will utilize HAMR technology by 2027. Seagate continues as the firm’s preferred investment, with its price target increased to $620 from $500.

Western Digital shares climbed approximately 2.3% during Wednesday’s premarket session following the upgrade before accelerating gains throughout regular trading hours.

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Crypto World

Naoris Launches Post-Quantum Blockchain as Quantum Risks Grow

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Naoris Launches Post-Quantum Blockchain as Quantum Risks Grow

Naoris Protocol has launched its mainnet, introducing a layer-1 blockchain designed to use post-quantum cryptography for transaction validation and network security. The network is live with limited, invite-only participation, allowing early users to run validator nodes and process transactions.

According to an announcement shared with Cointelegraph, it integrates cryptographic standards finalized by the National Institute of Standards and Technology (NIST) to address risks in existing blockchains, where current encryption methods could become vulnerable over time.

Before mainnet, the protocol’s test network processed more than 100 million transactions and identified hundreds of millions of potential threats, according to the project, with activity spanning millions of wallets and nodes.

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The system uses a consensus model called distributed proof of security (dPoSec) to verify transactions across nodes, while the NAORIS token is intended to support network operations as the economic model develops.

The rollout begins with a restricted group of validators and partners, with broader access expected to expand in phases.

The project lists advisers with backgrounds in cybersecurity, government and enterprise technology, and is backed by investors including Draper Associates.

Related: Is $450B in Bitcoin vulnerable to the quantum threat? Analysts weigh in

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New research suggests quantum computing may arrive sooner than expected

The launch comes as revised estimates for quantum computing, which uses qubits and quantum states to process information differently from classical computers, are driving efforts to move away from current cryptographic standards.

New research from Google released on Monday suggests quantum computers may need far fewer resources than previously thought to break blockchain encryption. The study found fewer than 500,000 physical qubits could crack systems securing Bitcoin (BTC) and Ether (ETH), a roughly 20-fold reduction from earlier estimates.

The findings point to a shorter timeline for quantum risk, with Justin Drake, a researcher at the Ethereum Foundation, estimating at least a 10% chance that a quantum computer could recover a private key by 2032.

Breakdown of Bitcoin supply by address type and quantum exposure risk. Source: Google Quantum AI

Researchers at California Institute of Technology working with Oratomic reached similar conclusions, recently finding that improvements in error correction (which reduce the number of qubits needed to stabilize computations) could lower the requirements for practical systems to 10,000 to 20,000 qubits, down from earlier assumptions of millions.

Based on these reductions, the researchers said a viable quantum computer could emerge by around 2030.

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Blockchain developers are beginning to respond. In January, developers in the Solana ecosystem introduced a quantum-resistant vault that uses hash-based signatures to generate new keys for each transaction, reducing the exposure of public keys.

On March 24, developers from the Ethereum Foundation launched a “Post-Quantum Ethereum” resource hub outlining plans to upgrade the network’s cryptography, targeting protocol-level changes by 2029 while also noting the multi-year complexity of such a transition.

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