Micron Technology (NASDAQ: MU) and SanDisk (NASDAQ: SNDK) shares slipped in pre-market trading on Wednesday, giving back part of Tuesday’s gains as investors reassessed how much optimism is already embedded in memory stocks.
Micron was down about 1.1% before the bell, while SanDisk fell roughly 0.5%.
The pullback follows a 6.8% jump for SanDisk on Tuesday and a 5% gain for Micron, extending rallies built on tight memory supply and AI-driven demand.
Tuesday’s rally raised the bar
SanDisk’s surge followed Rosenblatt analyst Kevin Cassidy initiating coverage with a Buy rating and a $2,400 price target.
Cassidy’s thesis is that AI is changing NAND’s economics.
He argued that new computing platforms are moving flash memory “from a commodity storage medium to a more system-critical component of AI infrastructure”, with performance, density, endurance and supply certainty becoming more important.
That view helped send SanDisk to $1,887.04 on Tuesday, leaving the shares up more than 600% this year.
SanDisk says agreements with eight customers should cover about half of fiscal 2027 bit production and roughly two-thirds in fiscal 2028, giving it more earnings visibility.
Those supports also raise the hurdle. When a stock has multiplied several times over, investors are no longer asking whether conditions are improving.
They are asking whether results can keep exceeding what the market expects.
Micron now faces an expectations problem
Micron has its own near-term test when it reports fiscal fourth-quarter results on September 30.
Stifel analyst Brian Chin remains constructive, arguing that supply constraints should keep pricing and margins elevated even as growth moderates.
He expects Micron’s revenue to rise about 22% sequentially in the fourth quarter, then slow to around 11% growth in the following quarter.
That deceleration does not imply a downturn. It does show why the stock may become more sensitive to expectations.
Beth Kindig of I/O Fund has made the point more directly.
“In all likelihood, the 343% YoY growth rate recently reported is in the rearview mirror,” she wrote, referring to Micron’s latest DRAM revenue growth.
Micron’s fiscal third-quarter DRAM revenue reached $31.3 billion, up 343% from a year earlier, while average selling prices jumped sharply. Numbers that large create difficult comparisons.
The cycle is strong but surprises matter more
Evidence supporting the memory thesis remains substantial.
Micron has said demand continues to exceed supply, while management expects industry conditions to remain tight beyond 2027.
AI workloads are increasing demand for HBM, conventional DRAM and storage, stretching capacity across the industry.
SanDisk is making a similar argument in NAND. Its multiyear customer agreements are designed to reduce the volatility that historically made flash memory one of the semiconductor industry’s most cyclical businesses.
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