Seagate leads memory sell-off after CEO’s comments about new factories
Shares of memory chip maker Seagate It lost more than 8 percent on Monday, sparking a sell-off across the group after CEO Dave Mosley expressed concerns that the company would not be able to meet growing demand. artificial intelligence building.
Mosley was asked a question: JPMorgan Monday’s conference will discuss what it would take to add unit or base capacity to produce more chips at Seagate’s factories.
“If we cut teams and start building new factories or training new machines, it will take too long. You’ll have more capacity, but then you’ll slow down the growth rate of that technology,” Mosely said.
Micron shares fell 5%, both SanDisk And Western Digital Corp.. It is trading about 7% lower.
Stock chart comparing Seagate, Micron, Western Digital and SanDisk prices over a five-day period.
Memory chip stocks have soared in recent months as AI investments drive demand and the chips become a key part of the AI fabric in data centers.
Chip production cycles span many quarters for a single unit, and investors are increasingly cautious about how long leading memory manufacturers can keep up with demand. CME Group is launching a new futures market for semiconductors; This allows more investors to keep prices stable and take precautions against increasing computing power prices.
At Monday’s conference, Mosely also touched on “very long lead times” and maintaining predictability with his customers.
“We know what will come out a year from now,” he said. “And we basically went to customers and said, ‘Look, if you want to plan this really well, which you should do for your data centers as well, we know what’s coming out. You can buy these by a certain amount of time.’ And so we want to keep that four or five quarters of visibility very, very robust for what’s being built. But the demand is much higher than that.”
