Top memory stocks like Micron (NASDAQ:MU), SanDisk (NASDAQ:SNDK), and Western Digital (NASDAQ:WDC) extended their decline as investors exited artificial intelligence positions. Micron, the third-largest player in the high-bandwidth memory market, fell for a fifth consecutive week, ending at $884, 30% below its year-to-date high.
SanDisk and Western Digital have dropped 51% and 54%, respectively. The Roundhill Memory ETF (CBOE: DRAM) fell to $48, 41% below its year-to-date high.
Investors are concerned that the AI sector is starting to slow down, which will impact demand for memory products. One reason for this is the elevated interest rates and bond yields.
There are signs that the funding issues are affecting the biggest companies. OpenAI, the AI pioneer, is concluding its fundraising, taking in $11 billion, well below its target of $30 billion.
25 trillion. Top spenders in the AI space, including hyperscalers like Microsoft (NASDAQ:MSFT), Meta Platforms (NASDAQ:META), and Alphabet (NASDAQ:GOOG), have come under pressure as investors question their massive capital expenditures.
As such, there is fear that a slowdown in AI spending by hyperscalers and other companies in the industry will lead to weak demand for memory products. Read Also: Coinbase, Robinhood and Other Crypto Exchange Stocks Tumble as Binance Hack Exposes Vulnerabilities Micron, SanDisk, Western Digital, and other Memory Companies Have Catalysts On the positive side, there are several potential catalysts that may drive memory companies higher.
One of them is that their revenue growth and profits are accelerating. 38 billion.
In South Korea, Samsung Electronics and SK Hynix also published strong numbers. Further, these companies are returning cash to their investors.
SanDisk returned $5 billion to shareholders in the quarter. It has repurchased 4% of its outstanding shares in the last two quarters.
Western Digital continued its buyback and hiked its dividends by 17%. Micron has said that it will repurchase shares worth $35 billion starting in December when the CHIPS Act restrictions end.
Other companies like Samsung and SK Hynix are returning billions of dollars to their shareholders. All of this is happening as they have become some of the cheapest companies on Wall Street.
8, respectively. 6.
As such, bargain hunters could start buying the dip.
