Citi: NAND Supply Shortage Expected to Persist Through 2028, Reiterates Buy on SANDISK CORPORATION

Citi published a research report stating that results and guidance from MICRON TECHNOLOGY, INC. (MU.US) beat expectations, reflecting strong artificial intelligence demand. The broker also reiterated its Buy rating on SANDISK CORPORATION (SNDK.US) , with a TP of USD2,100. The broker maintained its positive view on favorable NAND supply-demand fundamentals and improving visibility.

The broker noted that Micron's NAND revenue rose 42% QoQ, shipment volume increased about 10% QoQ, and prices climbed about 30% QoQ (versus market expectations of a 20% QoQ increase and Citi's forecast of a 34% rise), reflecting tight NAND supply. Management expects industry NAND bit shipment growth in 2026 to be in the low-20% range (around 20% to 24%), while Micron's own NAND supply growth will be below the industry level. For 2027 and 2028, industry NAND bit shipment growth is expected to be in the mid-20% range (around 23% to 27%), with supply remaining constrained over the two years. Citi believes that artificial intelligence-driven demand from data centers, including migration to more cost-effective SSDs for KV cache applications, will remain sustainable, benefiting NAND supply-demand fundamentals and supporting the case for strong business fundamentals and improved visibility for Sandisk.