SanDisk Inc. Shares Dip After TSMC Increases Capital Investment

The stock price of SanDisk Inc. fell 9.6% on July 16, reacting to a second-quarter earnings report from Taiwan Semiconductor Manufacturing Company. The decline occurred despite a massive surge in SanDisk Inc.'s valuation during the first half of 2026, where shares rose 857.8% through June. This growth was fueled by high demand for NAND Flash memory utilized in artificial intelligence data centers.

Taiwan Semiconductor Manufacturing Company reported a 77% year-over-year profit increase but triggered a market sell-off after raising its annual capital investment forecast to $60 billion. While the immediate reaction was negative for SanDisk Inc., analysts suggest the expanded production of AI CPUs and GPUs by Taiwan Semiconductor Manufacturing Company will eventually increase the need for complementary memory chips.

SanDisk Inc.'s financial performance remained strong leading into the dip, reporting a 251% revenue increase to $5.9 billion and a gross profit margin of 78% in the third quarter of 2026. This stability is supported by five multi-year supply agreements that provide $11 billion in guarantees. The broader memory market has also been influenced by Micron Technology, which raised chip prices in response to supply shortages.