SanDisk Shares fall about 14% in Heavy Trading

SanDisk Shares fall about 14% in Heavy Trading

Memory chips and flash storage maker SanDisk Corp informed that the company expects fourth-quarter revenue to be lower than its earlier forecast. Shares of the company have fallen by about 13.9% to $83.5 in heavy trading on January 12.

Earlier, Sandisk's rival Micron Technology also issued warning about tough times ahead, The stock price of Micron declined by about 5%.

According to analysts, the company's weak revenue forecast was because of glut in the market of memory chip as Samsung Electronics Co Ltd decided to focus on its chip business. Monika Garg of Pacific Crest Securities said that lower internal sales of flash memory chips at Samsung meant the manufacturer of flash memory storage was selling its chips in some other markets.

Last week, analysts had predicted that Samsung's chip business earned more than its mobile business in October-December. SanDisk's NAND memory chips have been in cameras, smartphones and other mobile devices to store various kinds of data.

Raymond James analyst Hans Mosesmann said, "I expected the glut in the market to be a short-term issue that would ease once manufacturers start cutting capacity".

SanDisk said that it expects revenue of about $1.73bil for the quarter that ended December 28, down from its previous forecast of $1.8bil to $1.85bil.