Sandisk Stock Drops Amid OpenAI Revenue Disappointment
On Thursday, Sandisk (NASDAQ: SNDK) saw its stock fall by 4.9%, despite positive developments such as declining bond yields and Federal Reserve signals suggesting no further interest rate hikes. However, the decline was attributed to disappointing revenue news from OpenAI, which reported $50 billion in annual recurring revenue at the end of September—$18 billion below earlier estimates. The lower-than-expected figures raised concerns that Sandisk’s AI-focused customers may need to take on more debt to afford memory chips if their revenues are insufficient. Despite this setback, OpenAI still achieved a 77% growth in its revenue run rate during the quarter. Analysts remain optimistic about long-term demand for memory chips due to tight supply conditions expected through at least 2028. Sandisk currently trades at an attractive valuation of just eight times next year’s earnings and continues to benefit from strong pricing power amid constrained chip supplies.
Tickers: $SNDK
Topics: Federal Reserve policy memory chip demand OpenAI revenue update Sandisk