SanDisk Inc. Shares Plummet 47% Amid AI Infrastructure Sell-Off

Shares of SanDisk Inc. fell 47% in July, marking a sharp reversal after the stock surged more than 800% during the first half of the year. This decline reflects a broader sell-off across the memory and AI infrastructure sectors as investors began significant profit-taking and questioned the sustainability of capital expenditures by hyperscalers.

Market skepticism intensified after Alphabet Inc. reported negative free cash flow for the first time in its second-quarter report. Similarly, SK Hynix missed bottom-line estimates in its first earnings report since listing in the United States, further dampening sentiment toward memory chip providers.

Competitive pressures from China added to the volatility. The launch of the Kimi K3 AI model and the $500 billion IPO of ChangXin Memory Technologies raised fears of increased competition and potential price drops for memory components. These concerns were compounded by reports that Apple Inc. requested permission to purchase memory chips from blacklisted Chinese companies and that Anthropic is developing its own AI chip, potentially bypassing established memory providers.