Analyst: The underlying logic of the storage chip sector has been re-evaluated, and the leading stocks have fallen by over 20% in the past few weeks

Deep Tide TechFlow news: On July 11, according to CCTV Finance and Economics, the U.S. stock storage-chip sector saw a collective pullback after hitting highs in late June. Major industry leaders including SanDisk, Micron Technology, Seagate Technology, and Western Digital have all had share-price declines of more than 20% over the past few weeks. The trigger was Meta’s sale of computing power, which raised market concerns about potential compute oversupply; the key variable is whether the technical gaps between each company’s large AI models will continue to narrow.

Insiders note that the storage-chip industry historically has strong cyclicality—when the sector is doing well, manufacturers collectively expand production, leading to sharp price drops and losses across the whole industry, followed by a collective contraction in capital expenditures. At the same time, the industry’s business model is undergoing profound change: cloud providers and AI data centers are increasingly signing 3-to-5-year long-term supply agreements with original equipment manufacturers that include price ranges and minimum purchase quantities, to ensure stability in the critical supply chain.