Shares of SanDisk Corp (NASDAQ:SNDK) declined 2.7%, while Seagate Technology PLC (NASDAQ:STX) and Micron Technology (NASDAQ:MU) fell 1.8% each during the pre-market trading session on Tuesday, extending the previous session’s losses.
The drop came as Seagate CEO Dave Mosley expressed concerns about the company’s capacity to meet the escalating demand for memory chips on Monday, a trend fueled by the expansion of artificial intelligence (AI). This led to a decline in leading memory stocks.
During a JPMorgan conference, Mosley discussed the challenges of increasing production capacity at Seagate’s factories, CNBC reported.
“If we took the teams off and started building new factories or bringing up new machines, that would just take too long. You would end up with more capacity, but then you’d slow the rate of growth on that technology,” he said.
Mosley also highlighted the issue of “very long lead times” and the need to maintain predictability with its clients. He said the company has already informed customers about products planned for release next year, allowing them to prepare and purchase equipment for their data centers in advance.
