That’s according to a Sunday (Jan. 25) report from the Financial Times (FT), which noted that while data storage companies had long been considered a less glamorous part of the IT hardware space, their stocks have jumped in recent months as artificial intelligence (AI) build-out is projected to surpass $500 billion for the year.
Shares in SanDisk have doubled since the beginning of the year, and are up nearly 1,100% since August. Micron and Western Digital have tripled during the same time frame, along with Korean chipmaker SK Hynix.
“By any measure, that’s an eye-watering few months,” said Arun Sai, a multi-asset strategist at Pictet Asset Management, referring to SanDisk’s gains. “The narrative [in the AI rally] has shifted to memory being the choke point in the sustained AI capex build-out.”
The report added that the sector’s rally was reignited recently when Nvidia CEO Jensen Huang said that “holding the working memory of the world’s AIs” could soon become “the largest storage market in the world.”
“The use for this high-bandwidth memory [in AI] has just exploded,” Rene Haas, CEO chip designer Arm, told the FT at the World Economic Forum in Davos, Switzerland, painting demand as “an insatiable need.”
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Huang was also in Davos, where he argued that AI is not a bubble, but an opportunity everyone should get involved in, as PYMNTS wrote.
“The ‘AI bubble’ comes about because the investments are large, and the investments are large because we have to build the infrastructure necessary for all of the layers of AI above it,” Huang said. “So, I think the opportunity is really quite extraordinary, and everybody ought to get involved, everybody ought to get engaged.”
The AI boom has driven a need for more energy, infrastructure and trade-skilled workers, the CEO added. It has also fueled growing opportunities and scale of investments, making 2025 the biggest investment year for AI in the history of venture capital.
“These AI companies are building basically the application layer above, and they’re going to need infrastructure, they’re going to need our investment, to go build this future,” Huang said.
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