Lasers, magnets and the $40 billion fight to store the world's data

Hard disk drive makers hope a breakthrough will keep it the dominant data-storage medium

- John Keilman

The fate of an industry is riding on a laser smaller than a grain of salt. Data-storage company Seagate developed this diminutive heat source to help it encode information in ever-greater quantities on the spinning magnetic platters of hard disk drives. Stacked by the thousands in data centers, the drives hold everything from home movies to medical records to factory log files.

Seagate's innovation, heat-assisted magnetic recording, is critical to the future of the globe-spanning manufacturer. Its hard drives are competing against newer and faster technology in the business of storing the world's information, and to survive, their capacity must continue to increase.

The company has started shipping a paperback-size drive that holds 36 terabytes of data—the equivalent of 1,400 Blu-ray movies. It has achieved nearly twice that in the lab, and its executives think far more is possible.

"We've always believed that hard drives had legs," said Seagate Chief Executive Dave Mosley. "We've proven that by continuing to invest in them and see the returns."

The new products arrive as AI is fueling a surge in demand for data storage. Data centers last year spent an estimated $40 billion on storage devices, according to the consulting firm IDC, and that is expected to grow by 31% over the next two years.

Wall Street analysts predict that Seagate's sales from fiscal 2024 to 2026 will increase by 55%, to $10 billion, while its earnings per share will grow by more than 650%.