11
The One Number Sandisk Bulls Need on Earnings Day
Sandisk’s Big Earnings Test: Can This Memory Chip Giant Bounce Back?
What Happened to Sandisk Stock This Summer?
Imagine a roller coaster that climbed to the very top in June… and then spent the whole summer plummeting down. That’s basically what happened to Sandisk (SNDK) stock.
The Summer Slide
- The stock broke below two important "trend lines" that traders watch closely:
- The 50-day moving average (the average price over the last 50 days)
- The 100-day moving average (the average price over the last 100 days)
- It hasn’t yet fallen all the way to the 200-day moving average (the long-term trend line)
Good news: Wednesday’s earnings report could be the moment the coaster starts climbing again. Analysts expect strong numbers, which might put the stock back on track.
The Magic Number: $1,707
According to Yahoo Finance AlphaSpace, there’s a specific price level to watch: $1,707.
| Price Level | What It Means |
|---|---|
| $2,354 | All-time high (hit in late June) |
| $1,707 | 50-day moving average — the "comeback" target |
| Current | Somewhere in between — down ~25% from the peak |
If Sandisk beats Wall Street’s high expectations and sounds optimistic on its earnings call, the stock could climb back up to test that $1,707 level. That would still be well below the June record — but it’d be a solid step in the right direction.
Why Memory Chips Are So Hot Right Now
Here’s the simple version: AI needs memory. Lots of it.
The Players Making the Chips
- Sandisk (SNDK)
- SK Hynix (SKHY)
- Samsung Electronics (005930.KS)
- Micron (MU)
The Customers Buying Them All Up
- Nvidia (NVDA)
- Microsoft (MSFT)
- Amazon (AMZN)
- Meta (META)
These tech giants are in an arms race to build massive AI data centers. They need a special type of memory chip — high-bandwidth memory (HBM) — and they’ve already bought up nearly all the supply through 2026.
What This Means for Prices
Supply & Demand 101
- When everyone wants something and there’s not enough to go around → prices go up
- Memory chip prices have shot up sharply
- Chip makers now have major pricing power (they can charge more)
- Experts say this shortage will last into 2027
That’s a very favorable setup for companies like Sandisk.
The Roller Coaster Ride: From Record Highs to Sharp Pullbacks
The Peak (Late June)
- Sandisk, Micron, and other chip stocks hit all-time highs
- Investors were excited about the AI memory boom
The Drop (Since Then)
- Fear set in: "Are Big Tech companies spending too much on AI?"
- Sandisk stock fell ~25% in the past month
- Micron stock fell ~13% in the past month
- (Data from Yahoo Finance AlphaSpace)
Apple Just Gave a Hint: Demand Is Still Strong
Last week, Apple (AAPL) reported earnings. The market’s reaction was basically a collective sigh of relief: "Oh, the memory chip demand story is still very real."
Now it’s Sandisk’s turn to deliver the same message.
Sandisk’s Numbers Look Huge
| Metric | Last Year | This Quarter (Estimate) | Change |
|---|---|---|---|
| Revenue | $1.90 billion | $8.39 billion | ~340% increase |
That’s not a typo. Revenue is expected to more than quadruple year-over-year.
What Wall Street Is Saying
BofA Analyst Wamsi Mohan broke it down:
"We expect supply/demand imbalance in the NAND market to remain through 2027 and expect pricing to remain strong for longer (through mid-2027), albeit growing at a lower quarter-over-quarter percentage rate over time. For the June quarter, we model bit growth of 13% quarter-over-quarter and average selling price growth of 35% quarter-over-quarter. This is higher than the NAND bit growth reported recently by competitor Micron Technology, but lower than the quarter-over-quarter average selling price growth reported by that company."
Translation (ELI5 Style)
- NAND = the type of flash memory Sandisk makes (used in SSDs, phones, AI servers)
- Supply/demand imbalance = not enough chips for everyone who wants them
- Through 2027 = this good times could last a while
- Bit growth 13% = they’re making 13% more chips than last quarter
- Price growth 35% = each chip sells for 35% more than last quarter
- vs. Micron = Sandisk is growing volume faster, but Micron got bigger price hikes
KEY TAKEAWAYS
- Sandisk stock crashed this summer — down ~25% from its June peak
- Wednesday’s earnings could be the turning point
- The big picture is still strong: AI memory shortage → high prices → big profits
- Revenue expected to quadruple year-over-year ($1.9B → $8.39B)
- Wall Street sees the boom lasting into 2027 — not a short-term fad
- $1,707 is the level to watch — if stock reclaims its 50-day average, momentum may return
Summary
Sandisk had a rough summer. The stock fell hard as investors worried Big Tech might pull back on AI spending. But the fundamentals haven’t changed: AI needs massive amounts of memory, the supply is sold out through 2026, and prices are soaring. Sandisk’s revenue is on track to quadruple. Wednesday’s earnings report is the chance to prove the summer slide was just a scare — not the start of a new trend. If they deliver (and sound confident), $1,707 could be the first step back up the mountain.
FAQ
What is a "moving average" and why does $1,707 matter?
A moving average is just the average stock price over a set number of days. The 50-day moving average ($1,707) is a short-term trend line. When a stock trades above it, the trend is considered healthy. When it falls below, traders get nervous. Reclaiming it signals momentum may be returning.
What is NAND flash memory?
NAND is a type of storage chip that keeps data even when the power is off. It’s in your phone, laptop SSD, USB drives — and critically, in the servers running AI models. Sandisk is a major NAND maker.
Why are AI memory chips sold out through 2026?
Building AI data centers requires a special high-speed memory called HBM (High Bandwidth Memory). It’s complex to make, and only a few companies can produce it. Tech giants (Nvidia, Microsoft, etc.) placed massive orders early, locking up supply years in advance.
Is the 25% drop a buying opportunity or a warning sign?
That depends on your time horizon and risk tolerance. The long-term demand story (AI memory shortage through 2027) is intact. The short-term drop was driven by fear of overspending. If earnings confirm demand is still red-hot, the drop may look like a discount in hindsight. But if guidance disappoints, the slide could continue.
How does Sandisk compare to Micron?
Both make memory chips and both benefit from the AI boom. Micron reported recently and showed strong pricing power. Sandisk is expected to show higher volume growth (13% vs. Micron) but lower price growth (35% vs. Micron). They’re peers riding the same wave — just with slightly different surfboards.
