Fujifilm to raise data tape production fivefold as AI drives storage demand

A Fujifilm LTO Ultrium 10 data cartridge inside an opened tape drive.

AI data centres are creating a growing need for storage, and Fujifilm is betting that one of the oldest technologies in the business still has a place in the future.

The Japanese company will invest ¥10 billion (€56 million) to increase its magnetic tape production capacity fivefold.

The investment will go into Fujifilm’s factory in Odawara, Kanagawa, between fiscal 2026 and fiscal 2028. The company plans to expand its production lines and hire more workers, with the target measured against the volume of tape it shipped in fiscal 2025.

Most of the extra capacity will go towards LTO Ultrium 10 cartridges, used by businesses to back up data and keep archives. Fujifilm said this would be its largest investment yet in facilities dedicated to LTO tape.

Tape may seem an unlikely technology to benefit from the AI boom, but it has a few advantages over other storage options. It can hold large amounts of data for years at relatively low cost, and cartridges can be kept offline, out of reach of ransomware and other network-based attacks.

Cloud providers and data centre operators are increasingly using it for long-term storage, Fujifilm said.

“This significant commitment to expand data -tape production reflects the growing importance of preserving and protecting ever -larger volumes of data. Tape may bring to mind cassette audio mixtapes and movies on VHS, but magnetic tape is a proven technology that continues to evolve, ” said Toshinari Fujii, senior vice president of the advanced materials division at Fujifilm Europe.

The company’s latest LTO cartridge stores up to 40TB, and the format’s longer-term roadmap aims to reach 365TB per cartridge, Fujifilm said. Fujifilm released its first LTO Ultrium 10 cartridges in 2025, followed by a 40TB version in January.

Demand for tape has not grown steadily as shipments across the LTO format fell 9% in 2025 to 160.3 exabytes, down from a record 176.5 exabytes in 2024. They rebounded in early 2026, rising 57% in the first quarter, The Register reported, citing the LTO Program.

Fujifilm’s expansion comes as AI data centres put pressure on supplies of memory and storage components. Chipmaker SK Hynix said this week that it expects the memory shortage to continue until 2030.

At Fujifilm, we know AI and digital services will only continue to accelerate. Therefore, resilient data infrastructure must support not only the creation and processing of information, but also its secure storage, preservation and recovery – for which tape is the ideal scalable, cost -saving, energy -efficient solution,” said Toshinari Fujii, senior vice president of the advanced materials division at Fujifilm Europe.

Fujifilm has been developing magnetic tape since the 1950s and launched its first LTO cartridge in 2000. The company says it now holds the largest share of the global magnetic tape market, based on its own estimates.

I am the Editor in Chief for TNW, covering technology not as a parade of launches and valuations, but as a system of influence, persuasion, (show all) I am the Editor in Chief for TNW, covering technology not as a parade of launches and valuations, but as a system of influence, persuasion, and change. I write about startups, venture capital, digital policy, and Europe ecosystem, with an eye on the larger story beneath them: who gets to build the future, who profits from it, and how Europe is learning to speak in a louder voice of its own. Before moving into senior editorial leadership, I've built my career for over +10 years across journalism, storytelling, content strategy, SEO, and digital publishing, with experience in SaaS, hospitality, art, and culture.

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