Sandisk, Western Digital Drop 9-15%, Drag Chip Sector
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- Sandisk shares dropped 9.2% to $1,226.04 and Western Digital tumbled 14.6% to $443.30 in premarket trading after both beat LSEG consensus estimates but fell short of lofty market expectations.
- Both storage names had run up dramatically in 2026 — Sandisk more than fivefold and Western Digital more than tripled — far outpacing the Philadelphia Semiconductor Index's near-70% gain and the S&P 500's 12.8% rise.
- Sandisk forecast Q1 revenue of $10.3-$10.8 billion and Western Digital guided $4.1 billion (plus/minus $100 million); Sandisk's data-center revenue surged more than 400% in 2026 versus 2025 and doubled sequentially in Q4.
- RBC Capital Markets warned "investor skepticism to continue," noting margins could be near peaks and price growth was moderating despite robust AI data-center demand.
- The selloff dragged chip peers: Seagate fell 3.6%, Micron dropped 3.7%, SK Hynix slid 6.2%, Intel lost 1.2%, AMD fell 1%, and Marvell dropped 1.1%.
Why it matters: Storage stocks that led 2026's AI rally — Sandisk up fivefold, Western Digital tripled — are now punished even when they beat estimates, a bar set so high that AI chip trades have entered a 'good isn't good enough' phase. Holders of Micron, SK Hynix, and Seagate absorbed collateral damage as the selloff spread sector-wide.
