Sandisk stock whipsaws after AI-led forecast and Kioxia supply deal - what to watch Monday
New York, January 31, 2026, 09:24 EST - Market closed.
Sandisk finished Friday up 6.8% at $576.25 after spiking to an intraday high of $675.88. The surge came on a forecast that topped expectations and a long-term supply extension with Kioxia, followed by a sharp fade on heavy volume.
The move fits the broader tape: investors are rotating into memory and storage as AI data centers expand beyond chips into the hardware that moves and stores data. That bid now meets tighter flash supply and higher expectations.
Why it moved: guidance + supply security
Fiscal Q2 revenue landed at $3.03B with GAAP net income of $803M ($5.15 per share). Adjusted EPS was $6.20. Datacenter sales rose 64% sequentially to $440M.
For fiscal Q3, Sandisk guided revenue to $4.4B-$4.8B and adjusted EPS to $12-$14. The bar is higher now after a blistering January and a guidance range that narrows room for misses.
On supply, Sandisk and Kioxia extended their joint venture at Yokkaichi to Dec. 31, 2034 (from 2029). Sandisk will pay $1.165B for manufacturing services and supply access in installments from 2026-2029. Management framed it as deeper access to flash output and R&D.
CEO David Goeckeler said AI "inference" is pulling more stored data into compute clusters, improving urgency for flash over price. That mirrors the DRAM squeeze now showing up in NAND.
The setup
Flash memory is tightening, much like DRAM did earlier. Pricing discipline tends to improve when supply is locked up through longer terms and prepayments. Sandisk's guide sits in that context and tightens expectations for execution.
Analysts moved quickly. Reuters noted Morgan Stanley sees earnings "above the long-term trend" if AI demand holds. Several brokers lifted targets, including a $1,000 mark from Bernstein. After a roughly 160% gain in January, positioning is crowded-there's less slack for hiccups.
Sector read-through
Western Digital, Seagate, and Micron have been riding the same thesis: AI infrastructure needs more memory and storage, not just GPUs. Friday reminded everyone how volatile this group is when guidance shifts the narrative.
Western Digital fell despite a revenue forecast beat-classic case of hot positioning and profit-taking overshadowing near-term fundamentals.
Key numbers at a glance
- Close: $576.25 (+6.8%); Intraday high: $675.88
- Fiscal Q2 revenue: $3.03B
- GAAP net income: $803M ($5.15/sh); Adjusted EPS: $6.20
- Datacenter revenue: $440M (+64% q/q)
- Fiscal Q3 guide: Revenue $4.4B-$4.8B; Adjusted EPS $12-$14
- Kioxia JV extension: to 2034; Payments: $1.165B over 2026-2029
What to watch Monday
- Can it hold the close? Friday's reversal makes $576 the first test. The gap to the intraday high near $676 is your reference for momentum vs. profit-taking.
- Volume and liquidity. Strong follow-through would suggest long-only demand is stepping in after short-term traders rang the bell.
- Contract color. Any remarks on term length, upfront payments, and price discipline as flash tightens will matter more than units.
- Datacenter mix. Signs that inference-heavy workloads are pulling more flash will reinforce the thesis that demand isn't just hype.
- Street resets. Watch for estimate revisions and new targets filtering in after Friday's scramble.
Risks and scenarios
- Bull case: AI inference ramps, flash stays tight, and contract terms stay firm. Guidance becomes a floor, not a ceiling.
- Bear case: Supply overshoots or AI capex slows. Pricing power slips, and last week's move marks a peak rather than a baseline.
- Wild card: Production cadence at JV facilities (Yokkaichi) and any incremental capacity adds that change the supply picture.
How pros may approach it
- Levels: Use Friday's close (~$576) and high (~$676) as tactical signposts.
- Basket thinking: Pair moves across Western Digital, Seagate, and Micron to manage single-name volatility while keeping the memory thesis intact.
- Expectations: After a 160% January, the margin for disappointment is thin. Headlines on pricing and contract structure can swing the tape.
U.S. markets resume Monday, Feb. 2. Investors will weigh the earnings beat, the Kioxia extension, and fresh analyst targets against Friday's reversal. The first hour should tell you if long-only demand is willing to defend the close.
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