Sandisk Corporation (SNDK) shares rose 2.27% to $1,779.38 on Thursday as stronger NAND pricing supported the company’s storage outlook. Citi maintained its $2,100 price target and highlighted tighter NAND supply alongside growing demand from artificial intelligence infrastructure.

The outlook extends through 2028, when industry supply growth could continue to trail rising storage requirements across major data center markets. Citi’s assessment followed Micron Technology’s latest quarterly results, which showed a sharp improvement in its NAND business — the flash memory technology that underpins solid-state drives.

Citi Sees Tight NAND Supply Supporting Sandisk

Micron reported a 42% sequential increase in NAND revenue during its fourth quarter, reflecting stronger demand and pricing. NAND bit shipments climbed 10%, while average selling prices increased by almost 30% during the reporting period.

The price increase exceeded Citi’s earlier expectation for roughly 20% average NAND price growth across the market. The stronger-than-expected move indicated that industry supply remains constrained even as storage demand continues to expand across enterprise applications. NAND flash comes from a limited group of manufacturers, so production decisions at a few companies can move pricing across the entire market.

Sandisk could benefit from firmer pricing because higher selling prices can support margins across flash-memory and solid-state storage products. The same price strength, however, raises storage acquisition costs for enterprises and cloud operators planning capacity expansions. Micron expects its NAND supply growth in 2026 to trail overall industry expansion as manufacturers manage production carefully.

Industry NAND bit shipments could grow at a mid-20% pace during both 2027 and 2028. That combination of shipment growth and controlled production could keep market conditions tight if demand from data centers increases faster than new manufacturing capacity.

AI Data Centers Increase Demand for SSD Storage

Artificial intelligence infrastructure is creating larger storage requirements across data centers and cloud-computing systems worldwide. Operators need fast storage for model training, inference workloads, caching, and large-scale data movement across computing clusters. Solid-state drives are becoming increasingly important in high-performance computing environments and modern data center architectures.

Citi analyst Atif Malik identified AI key-value cache workloads as another potential source of storage demand. Key-value caches hold intermediate inference data so models can reuse it without recomputation, and data centers can shift some of these tasks toward lower-cost SSDs instead of more expensive memory products. This could increase demand for NAND-based storage as companies seek to lower costs without sacrificing storage performance.

Sandisk, which completed its separation from Western Digital in February 2025, sells flash-memory products and storage solutions serving consumer, enterprise, and data center markets globally. Rising enterprise SSD demand could provide the company with an additional growth channel beyond traditional device storage. Stronger pricing could also improve revenue visibility if supply remains disciplined across the broader NAND industry through 2028.

Sandisk Outlook Extends Through 2028

Citi kept its buy rating and $2,100 price target for Sandisk following the updated NAND outlook. The target reflects expectations that constrained supply and higher demand could support stronger earnings conditions over several years. Sandisk’s 2.27% share-price gain brings the stock closer to that target after recent shifts across semiconductor and storage stocks.

The broader memory industry is also recovering from an earlier downturn that pressured prices and production plans. Producers had reduced output and capital spending after excess inventories weakened memory pricing across several technology markets. Stronger data center spending and tighter inventories are now supporting a more favorable supply environment.

Future performance will depend on NAND pricing, shipment growth, and the pace of capacity additions, with upcoming quarterly reports from memory makers and any new capacity investment announcements serving as the next checkpoints. Market conditions could change if producers expand output faster than expected over the next two years. Demand growth must also remain strong enough to absorb additional supply without weakening prices across the storage market.

Sandisk’s growth outlook is closely linked to the broader expansion of artificial intelligence infrastructure. Data centers require more storage as models generate larger datasets and increasingly complex workloads across enterprise systems. NAND demand could remain elevated through 2028 if infrastructure spending stays strong and production growth remains controlled.

Original source: Blockonomi