SanDisk (SNDK) Stock Plummets 13% Following Record Peak Amid Memory Chip Selloff

Key Takeaways

Table of Contents

SanDisk (SNDK) shares reached a 52-week peak of $2,354.39 on June 22 before retreating, maintaining a remarkable 700%+ gain in 2026.
The decline coincided with a major selloff in South Korea’s Kospi index and mounting uncertainty over AI memory spending sustainability.
According to Morgan Stanley, SanDisk views AI as “fundamentally changing” NAND dynamics, fueled by inference workloads and expanded LLM context windows.
Third quarter FY2026 revenue exploded 251% versus prior year to $5.95 billion, crushing Wall Street’s $4.55 billion forecast.
Fourth quarter outlook projects revenue between $7.75B and $8.25B, with non-GAAP EPS guidance of $30 to $33.

SanDisk (SNDK) shares have delivered one of 2026’s most impressive performances. Following a year-to-date surge exceeding 700%, the stock peaked at $2,354.39 on June 22 before encountering turbulence.

Sandisk Corporation, SNDK

The memory chip maker experienced a steep decline alongside sector peers, pressured by a significant downturn in South Korea’s Kospi benchmark and emerging concerns regarding the durability of AI-fueled memory demand. SNDK has retreated approximately 13.6% in the recent selloff and is down roughly 5.75% across the past five sessions. Trading data shows the stock hovering around $1,963.60.

Despite this correction, shares remain elevated 32.8% over the trailing 30-day period. This perspective is crucial — the current volatility represents the first significant challenge to the AI memory narrative since SanDisk separated from Western Digital in early 2025.

AI’s Transformative Impact on Memory Markets

Morgan Stanley’s Joseph Moore highlighted that SanDisk sees AI as “fundamentally changing” NAND dynamics. The primary catalyst is inference workload requirements. With large language models demanding expanded key-value caches and broader context windows, DRAM capacity alone proves insufficient — positioning NAND to occupy a higher tier in the memory architecture.

Cloud infrastructure is projected to emerge as NAND’s dominant end market before year-end. This transition is already visible in SanDisk’s financials, with data center revenue skyrocketing 233.4% sequentially to reach $1.47 billion during Q3 FY2026.

The third quarter results, announced April 30, exceeded expectations dramatically. Revenue totaled $5.95 billion, representing a 251% year-over-year increase and substantially outpacing the $4.55 billion analyst consensus. Non-GAAP EPS delivered $23.41 compared to the $14.36 estimate. Non-GAAP gross profit surged 1,111.9% annually to $4.7 billion. Additionally, the company achieved debt-free status, closing the quarter with $3.7 billion in cash reserves.

Shares climbed 3.04% on the earnings announcement and continued upward with an 8.25% gain in the subsequent trading session.

Forward Outlook and Valuation

For Q4 FY2026, management projects revenue ranging from $7.75 billion to $8.25 billion, with non-GAAP EPS between $30 and $33. Wall Street analysts forecast Q4 EPS of $31.81, representing a staggering 158,950% year-over-year increase.

QLC Stargate products — which have undergone hyperscaler qualification testing for over twelve months — are anticipated to commence revenue-generating shipments in Q4, supplementing existing TLC product momentum.

Notwithstanding the impressive rally, SanDisk commands a forward adjusted P/E ratio of 34.13 and a price-to-sales multiple of 17.17, both exceeding industry benchmarks. Its trailing P/E of 64.5 surpasses the industry norm of 44.5. Current pricing also sits approximately 12% above the consensus analyst target of $1,863.06.

Among 21 analysts tracking SNDK, 18 assign a “Strong Buy” rating, one recommends “Moderate Buy,” and two rate it “Hold.” Morgan Stanley holds an “Overweight” stance with a $1,750 price objective. The highest Street target stands at $3,250.

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