Why did SanDisk shares jump 24%?

SanDisk shares jumped 24% due to explosive growth fueled by artificial intelligence driving unprecedented demand for memory components.

When is the memory supply shortage expected to ease?

Demand for memory components is expected to continue outpacing supply at least beyond 2026, with the favorable supply-demand environment persisting through 2027.

How will memory price increases affect consumers?

Consumers may face more severe price hikes for memory components like RAM compared to large corporations, as the gap between contract and spot prices widens.

Home / Business and Economy / SanDisk Soars Amidst Unprecedented Chip Scarcity

SanDisk Soars Amidst Unprecedented Chip Scarcity

30 Jan

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Summary

SanDisk anticipates explosive growth due to AI-driven memory demand.
Demand for memory components significantly outpaces supply in 2026.
End consumers may face more severe price hikes than large corporations.

SanDisk Soars Amidst Unprecedented Chip Scarcity

SanDisk's stock experienced a significant 24% jump, extending its rally to an impressive 1,755% since its debut. This surge is largely attributed to the escalating demand for memory technology fueled by artificial intelligence.

The company reported fiscal second-quarter results that far surpassed both market expectations and its own guidance. Despite generating over $3 billion in revenue, SanDisk is unable to meet current demand, a situation expected to persist through 2026. This imbalance between supply and demand creates a "choke point" in the technology sector.

While major corporations like Apple may face moderate impacts from rising memory prices, with an estimated 50% jump in DRAM prices for 2026 potentially reducing gross margins by 90 basis points, individual consumers are bracing for more severe consequences. The gap between contract prices and spot prices for memory, particularly DDR5 and DDR4 RAM, has widened considerably.