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Sandisk Sinks 9% Despite Earnings Beat, Raised Guidance and 8-for-1 Split; Western Digital Tumbles 8%, Seagate Slides 7%, Micron Falls 6%
24/7 Wall St. • • business
Key Points:
- Despite beating Q1 FY2027 earnings and revenue estimates and raising its Q2 outlook, Sandisk shares dropped 9% in pre-market trading, reflecting profit-taking after a 460% year-to-date gain.
- Sandisk reported $11.03 billion in Q1 revenue, driven by a 61% sequential increase in data center revenue due to AI storage demand, and maintained an adjusted gross margin of 85.1%.
- The company completed a $5 billion share buyback and announced an eight-for-one stock split effective November 20, which does not affect the overall ownership value for shareholders.
- Competitors Western Digital, Seagate, and Micron also saw sharp declines of 6-8%, indicating a broader selloff in memory and storage stocks amid concerns over high memory prices and mixed demand signals.
- Sandisk faces ongoing challenges as high memory prices support pricing power but suppress PC demand, with the next key test being whether strong data center demand can sustain pricing after the stock split.
