Memory chip stocks are having a difficult week, and Qualcomm's latest earnings have given investors another reason to be cautious. Micron, SanDisk and SK hynix extended their losses in overnight trading, each falling around 2.5%.
The additional selling followed a turbulent regular session on Wednesday that saw Micron tumble 7%, SanDisk lose 8% and SK hynix retreat 5%. Wednesday's initial selloff followed sweeping Democratic victories in the U.S. midterm elections, which raised concerns about tighter restrictions on data-center construction.
The overnight weakness came after Qualcomm released disappointing smartphone sales figures. The chip maker plunged about 9% in extended trading, raising concerns that weakening consumer electronics demand could eventually affect the memory industry. Qualcomm's handset revenue fell 26% year over year to $5.14 billion.
Micron has benefited tremendously from growing demand for high-bandwidth memory, an essential component of advanced AI processors. Its fiscal fourth-quarter revenue reached $54.23 billion, representing 379% annual growth, while adjusted gross margin climbed to 87%. The company also projected fiscal first-quarter revenue of $61.5 billion, reflecting continued strength in data-center investments.
Wall Street remains bullish despite these concerns, awarding Micron a Strong Buy consensus rating based on 28 Buys and one Hold. SanDisk faces particular uncertainty owing to its heavy exposure to NAND flash memory, widely used in smartphones, computers and cloud storage systems. The company recently reported fiscal first-quarter revenue of $11.03 billion, representing 378% annual growth. SK hynix reported record third-quarter results in late October, with revenue of 104.6 trillion won and operating profit of 83.3 trillion won.
