SanDisk earnings selloff analysis
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Create a large chart with a bold h2 title showing SNDK Free Cash Flow ($B) over time, no commentary. Then below, share an in-depth commentary on why SanDisk sold off after earnings this week. Also weave in recent reports that Nvidia is weighing less high-bandwidth memory for its Rubin chips amid memory supply shortages and price spikes.
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SNDK Free Cash Flow ($B)
The Post-Earnings Selloff Explained Despite posting a massive Q4 beat with $8.97 billion in revenue and a 437% year-over-year surge in data center sales, SNDK shares tumbled roughly 8% to 10% following the report. The primary catalyst for the selloff was cautious forward guidance, which led analysts to question whether the company's record profit margins are sustainable. Markets often price in perfection for AI-adjacent trades, and management's cautious tone was enough to trigger profit-taking after the stock's massive run leading up to the print.
The Nvidia "Rubin" Impact Compounding these margin and guidance fears are new supply chain reports regarding NVDA. On August 6th, The Information reported that Nvidia is weighing the radical idea of equipping its upcoming "Rubin Ultra" AI chips with less high-bandwidth memory (HBM) than initially planned.
This potential design shift is reportedly being driven by ongoing memory supply shortages and extreme price spikes. If the undisputed leader in AI chips reduces memory density per GPU to bypass supply bottlenecks, it directly threatens the long-term demand curve and pricing power for memory suppliers like SanDisk. Consequently, traders are locking in gains on SNDK as they weigh the risk of peaking profit margins against a potential structural shift in future AI memory demand.
