Nvidia, Micron and AMD slipped in US pre-market trading on Thursday after SanDisk’s outlook triggered a retreat across artificial-intelligence and memory-chip shares.
At 5.30am ET, Nvidia was slightly lower, Micron had fallen 3.3% and AMD was down 1.9%, while SanDisk tumbled more than 9%.
Nasdaq 100 futures declined 0.4% as investors reassessed valuations across an overcrowded semiconductor trade.
The contradiction was clear. SanDisk comfortably beat quarterly revenue and earnings forecasts, but its September-quarter guidance failed to clear the higher expectations created by a 469% rally this year.
SanDisk’s strong quarter misses the whisper bar
SanDisk reported fiscal fourth-quarter revenue of $8.97 billion, ahead of the $8.48 billion FactSet consensus.
Adjusted earnings reached $39.25 a share, compared with expectations of $34.96, while data-centre revenue rose to $2.98 billion.
The disappointment came from the outlook. Management forecast September-quarter revenue between $10.3 billion and $10.8 billion.
Its $10.55 billion midpoint fell below Wall Street’s estimate of about $10.8 billion, while adjusted earnings guidance of $44 to $46 offered little additional upside.
That would normally count as a strong forecast. For SanDisk, investors wanted another dramatic increase capable of forcing earnings estimates substantially higher.
As per analysts, the market is being driven more by sentiment than by how strong a company’s earnings or guidance actually are.
Wedbush analyst Matt Bryson remains constructive. He expects earnings momentum to continue through fiscal 2027 and 2028 because industry capacity additions remain limited and multiyear customer agreements provide better visibility.
Micron absorbs the sharpest memory read-through
Micron was the most logical casualty because its business overlaps closely with SanDisk’s memory-cycle exposure.
SanDisk focuses on NAND flash, while Micron sells NAND, DRAM and high-bandwidth memory. Both have benefited from restricted supply, higher prices and AI data-centre investment.
Thursday’s pressure also followed a steep Asian semiconductor decline led by Samsung Electronics and SK Hynix.
That reinforced the impression that investors were cutting positions across crowded memory trades rather than reacting only to SanDisk.
The move does not prove the cycle has peaked. Micron delivered record results in June and has secured long-term customer commitments as buyers compete for supply.
Morgan Stanley analyst Joseph Moore wrote that there was “no quick fix to the memory shortage.”. He believes constraints could persist for another two to three years, or longer.
Nvidia and AMD face different pressures
Nvidia’s modest decline appeared to reflect broad sector de-risking and profit-taking.
The shares gained 3.4% on Wednesday after Elon Musk said SpaceX would rely exclusively on Nvidia chips, giving traders an obvious opportunity to lock in gains.
AMD entered Thursday in a weaker position. Its shares had already fallen 7% on Wednesday after record revenue and an above-consensus outlook failed to offset disappointment over a flat 56% third-quarter gross-margin forecast.
Aptus Capital Advisors portfolio manager David Wagner called AMD’s reaction a classic “sell the news” event in comments to MarketWatch.
William Blair analyst Sebastien Naji said AMD still had “much to prove” and faced a high execution bar as Helios ramps.
SanDisk’s August 13 investor day now becomes the next sector test, as management must show that customer contracts and AI-storage demand can support earnings beyond the present shortage.
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