Sandisk (SNDK +5.57%) this morning unveiled its newest, 9th-generation, "high-performance 2Tb QLC 3D flash memory technology designed to support the growing storage demands of AI-driven infrastructure."
Sandisk stock is up 7.2% through 9:50 a.m. ET Wednesday in response.
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Sandisk and Kioxia: better together?
Sandisk developed the new flash memory technology in cooperation with Japan's Kioxia Corporation. The companies say their 9th-generation flash chips both read and write data 33% faster than the previous 8th-generation chips and are more power-efficient.
Sandisk and Kioxia designed their 9th-gen chips to be future-proof as well. Recognizing that generative artificial intelligence is evolving toward agent-based and physical AI (where AI processes data directly on a device, such as when it operates robots or self-driving vehicles), the new chips are designed to favor these applications.
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What this means for Sandisk
All of which sounds great for Sandisk, but does it justify adding nearly $14 billion to the company's market capitalization in a single morning? Perhaps.
Valued at $181 billion today, Sandisk's stock price has come down a lot since closing at a record $2,335 in late June. That's a haircut of nearly $1,000, or more than 40%! At today's price, Sandisk stock costs less than 17 times trailing earnings -- earnings that are forecast to keep on climbing for at least the next couple years, and average better than 42% annual growth over the next five years, according to data from S&P Global Market Intelligence.
Sandisk's new Gen 9 chip may be only an incremental improvement that keeps it abreast of the competition. But at this price, just maintaining its current position in the memory market should be enough to make Sandisk stock a winner.
