Why Sandisk Stock Dropped on Monday
2026-10-12 14:36
•Rich Smith •The Motley Fool
•••• • Axe Cap view
Sandisk's Dip Overstated Amid Chinese DRAM Advances
Sandisk stock dropped sharply on Monday, but the reasons look less threatening to its core NAND business.
Sandisk's 6.6% share drop after news of Chinese memory producer CXMT's progress in DRAM technology is a classic case of market overreaction. While DRAM is crucial for AI data centers, Sandisk deals mainly in NAND memory, which serves different storage needs. CXMT’s chips also aren’t cheaper than Korean or Western alternatives, meaning pricing pressure on Sandisk remains limited. For South African investors, this tech tussle signals that import costs could stay elevated, which can keep the rand under some pressure through tech supply chain channels. However, it also shows a fragmented tech memory market where a single breakthrough won't immediately reroute global demand. If you’re eyeing local exposure, look to Prosus or Naspers, whose global tech footprints might capture any broad shifts in chip-driven innovation rather than a single memory niche. this is just our opinion and not financial advice
Trim or hold existing positions in Prosus and Naspers rather than buying more, given the uncertainty around memory chip tech leaps. Avoid direct exposure to semiconductor niche plays until clearer winners emerge.
- Prosus
- Naspers
- USD/ZAR
- CXMT manages a real cost breakthrough in DRAM chips
- Wider chip shortage or supply chain disruptions drive tech pricing volatility
6/10
Sandisk stock fell 6.6% on Monday following news that Chinese memory chip maker CXMT made progress on advanced DRAM technology for AI data centers. However, analysts note that Sandisk specializes in NAND memory, not DRAM, limiting direct competition. Additionally, CXMT's chips are not cheaper than Korean or Western alternatives, reducing the competitive threat.
Our take is based on reporting first published by The Motley Fool.