Data storage companies Sandisk and Western Digital saw their stocks fall in premarket trading on Thursday after quarterly results failed to sustain momentum in an industry that has become one of Wall Street’s hottest bets this year.
Shares of Sandisk lost 9.2% to trade at $1,226.04, while Western Digital shed 14.6% and was last changing hands at $443.3. After the closing bell on Wednesday, both Sandisk and Western Digital forecast quarterly revenue that beat estimates compiled by LSEG, but fell short of high market expectations.
Industry Outlook
The reaction underscores the high bar set for the market’s AI favorites after stellar gains this year, with even strong earnings and upbeat forecasts failing to satisfy investors. Sandisk has soared more than fivefold this year and Western Digital has more than tripled on bets that data storage and memory chipmakers could be among the biggest beneficiaries of Big Tech’s AI spending spree.
A global shortage of high-end memory chips has fueled a sharp rise in chip prices, filling the coffers of industry players. But even as demand for AI data-center components shows few signs of easing, investors are punishing companies at the slightest hint that the growth may normalize.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
