US Stock Market Move | Storage chip concept stocks plummeted collectively, with SanDisk (SNDK.US) falling over 11%.

On Thursday, storage chip concept stocks collectively plummeted, with Western Digital Corporation (WDC.US) falling over 18%, SanDisk (SNDK.US) dropping more than 11%, SK Hynix (SKHY.US) declining over 7%, Seagate Technology Holdings PLC (STX.US) down over 6%, and Micron Technology, Inc. (MU.US) dropping nearly 6%. Storage giant SanDisk disclosed its Q4 financial report for fiscal year 2026, showing that the companys performance in the fourth quarter exceeded expectations, with revenue, EPS, and gross margin all reaching record highs for a single quarter. The company's revenue increased by 372% year-on-year to $8.97 billion, surpassing the expected $8.39 billion; on a non-GAAP basis, the adjusted EPS reached $39.25, 135 times the $0.29 recorded a year ago, and exceeded analysts' expectations by more than 10%; the adjusted gross margin reached 84.6%, 3.2 times that of a year ago, and was higher than the market expectation of 81.5%. In terms of earnings guidance, SanDisk anticipates Q1 revenues for fiscal year 2027 to be between $10.3 billion and $10.8 billion, with a midpoint of approximately $10.55 billion, representing a year-on-year growth of 359%, although this is almost 5.5% lower than analysts' expected $11.16 billion. Additionally, the company expects an adjusted EPS of $44 to $46 for the first quarter, with a midpoint of $45, slightly lower than the market expectation of about $45.58. The adjusted gross margin guidance is set at 83.0% to 85.0%, which is basically maintaining a high level compared to the fourth quarters 84.6%, but has not expanded significantly further. Analysts from Goldman Sachs Group, Inc., led by James Schneider, pointed out in their report after the earnings announcement that the core contradiction currently facing the storage industry is not a deterioration in the fundamentals, but rather that market expectations have overly outpaced reality. Goldman Sachs Group, Inc. noted that the midpoint of the revenue guidance provided by SanDisk for the next quarter was only $10.55 billion, significantly lower than the market's general expectation of $11.15 billion; the gross margin guidance also failed to surprise. For Western Digital Corporation, although its gross margin guidance slightly exceeded expectations, the overall revenue outlook was only in line with market consensus, interpreted as "not surprising enough." Citigroup analyst Asiya Merchant lowered SanDisk's target price from $250 to $210 while maintaining a Buy rating. On the same day, Jefferies Financial Group Inc. reduced SanDisk's target price from $300 to $175.