Despite SK Hynix’s plans to dramatically scale up NAND flash production, analysts and market data suggest Sandisk (NASDAQ: SNDK) investors have little reason to panic.
Sandisk stock has delivered gains of more than 3,660% over the past year, driven by surging AI-fueled demand for NAND flash storage chips.
The company’s explosive revenue and earnings growth stems directly from a persistent supply shortage that has pushed NAND flash prices sharply higher across global markets.
SK Hynix, which controls 18% of the global NAND flash market according to Counterpoint Research, is reportedly planning to invest $51 billion to build a new NAND flash production facility in South Korea by 2029.
The South Korean semiconductor giant reported $35.5 billion in first-quarter revenue, dwarfing Sandisk’s trailing-twelve-month revenue of just over $13 billion.
Sandisk holds a 13% share of the global NAND flash market, and SK Hynix’s deeper pockets and broader product portfolio give it significant leverage to influence overall supply dynamics.
At first glance, a capacity investment of this scale from such a dominant player would appear to threaten the supply shortage that has been powering Sandisk’s remarkable growth.
However, the storage requirements of AI data centers are so strong that the market is expected to remain undersupplied through 2028, limiting the impact of any near-term capacity additions.
SK Hynix itself estimates that the shortage of memory chips could persist through the end of the decade, even accounting for the new production capacity it plans to bring online.
Silicon Motion, a company that supplies NAND flash controllers, estimates that the shortage could actually worsen next year, reinforcing the view that demand continues to outpace available supply.
Market research firm TrendForce is now anticipating NAND flash industry revenue to reach $379 billion in 2027, up significantly from an earlier estimate of $176 billion.
For added context, overall NAND flash revenue is anticipated to reach $271 billion this year, a sharp jump from $71.1 billion in 2025, highlighting the scale of the ongoing demand surge.
With AI data center buildouts accelerating globally, the structural drivers behind Sandisk’s growth appear durable enough to withstand the eventual arrival of new supply from SK Hynix and others.
Sandisk currently trades at approximately 27 times forward earnings, a valuation that some analysts consider attractive given the company’s growth trajectory and the strength of underlying demand trends.
