NEW YORK, June 4, 2026 – SanDisk Corporation (SNDK) saw its shares retreat in premarket trading Thursday, pausing a blistering rally as a wave of selling in artificial intelligence chip stocks dampened enthusiasm for one of Wall Street's most crowded trades.
The stock fell 5.7% to $1,727.22 as of 7:04 a.m. Eastern, following a record close of $1,831.50 on Wednesday. Just a day earlier, shares had surged 6.7% and touched an intraday high of $1,861.00. Despite the pullback, SanDisk remains up roughly 672% year-to-date, making it one of the standout performers in the broader market.
AI Chip Weakness Spreads
The decline came as Broadcom Inc. (AVGO) dropped 12.4% premarket after reporting quarterly results that missed revenue expectations and left its long-term AI chip forecast unchanged. According to Reuters, AJ Bell's Dan Coatsworth noted that “meeting and even slightly beating forecasts is not enough” when market expectations are sky-high, a sentiment that weighed on the entire AI chip complex. The selloff dragged down S&P 500 and Nasdaq 100 futures.
While SanDisk is not a direct competitor to Broadcom, its fortunes are closely tied to the AI-driven demand for memory chips used in data centers. SanDisk’s core business is NAND flash memory, which retains data without power and is critical for consumer devices, enterprise storage, and cloud infrastructure. In the U.S., Micron Technology (MU) is its closest publicly traded rival.
Record Revenue and Bullish Outlook
SanDisk’s recent financial performance has been stellar. The company reported fiscal third-quarter revenue of $5.95 billion, up 97% sequentially, with data-center revenue surging 233%. For the fourth quarter, management guided revenue in the range of $7.75 billion to $8.25 billion and non-GAAP diluted earnings per share between $30 and $33.
CEO David Goeckeler, in an interview with Reuters, emphasized that the current upcycle is different from past booms. He called the industry’s historic “boom-bust cycle” its “bane” and outlined a strategy for “consistent, predictable economics.” SanDisk has locked in at least $42 billion in long-term contracts and announced a $6 billion share buyback program.
The ‘Chipflation’ Risk
However, the very shortage that has boosted SanDisk’s pricing power also carries significant risks. Morgan Stanley analysts, led by Joseph Moore, raised their price target on SanDisk to $1,750 from $1,100 while maintaining an Overweight rating. Moore wrote that there is “no quick fix” for the ongoing memory shortage, which could last two to three years or longer. Yet he also warned that memory-chip prices have jumped sixfold over the past year, a phenomenon dubbed “chipflation.” This is squeezing hardware margins, raising cloud costs, and making devices less affordable, potentially dampening demand.
Automakers, retailers, electronics firms, and telecom companies in the U.S. have been lobbying Treasury and Commerce officials, arguing that memory chip shortages could lead to higher household prices and supply chain disruptions. While this bolsters the case for memory chipmakers that supply is tight, it also introduces policy risk, buyer pushback, and the threat of demand destruction.
What’s Next
With SanDisk shares now trading above several Wall Street price targets, traders are closely watching for any signs that the scarcity-driven profits can be sustained. The next major catalyst is the June 9 Mizuho Technology Conference, where investors are expected to press management on contract details, pricing trends, and supply dynamics. The outcome could determine whether SanDisk’s rally resumes or faces further headwinds.
