Citrini analyst: In the AI era, storage cycle logic may change; the fall in chip stocks does not necessarily mean the industry is collapsing

Deep Tide TechFlow news, on July 18, Citrini analyst Jukan posted an analysis saying that in addition to leverage funds liquidating positions, the recent decline in storage chip stocks may also be the market anticipating and pricing in pressure from future supply expansion. Even if the global storage shortage continues through 2027, most research institutions and industry observers still expect supply-demand tightness to start easing in 2028. With storage manufacturers such as Samsung Electronics and SK hynix announcing large-scale wafer fab expansion plans, the market may already have begun to factor in the impact of newly released capacity after 2028.

There is a common rule in the traditional storage industry: storage stock prices typically reflect a peak in storage prices about two quarters in advance, but in the AI-driven new cycle, could the market potentially price in future supply-demand changes earlier by a longer period—such as three or even four quarters? The AI era may bring new changes; the traditional logic that “price cuts lead to revenue declines” in storage cycles may not fully apply to the AI infrastructure market.

Jukan said the key difference is that in the AI era, “demand growth driven by falling prices” may cushion the downside impact on the storage price cycle. If this logic holds, future earnings volatility for storage companies may be lower than in past cycles, and it may also support higher valuations.