In short: Terranova's illustration that investing "is not a science, it is an art" — and a striking one, since SanDisk was, in his words, "one of, if not the highlight of the momentum trade this year." The example: "David Tepper in Q2, in what is fundamentally the strongest quarter the company has ever had, he has the tacit knowledge, the art of investing, to get out of the position. And that's exactly what I'm trying to identify." Cited as a lesson about exiting on positioning rather than fundamentals, not as a call on the stock.
SanDisk makes flash memory, and it was, in Terranova's words, one of the standout momentum trades of the year. It appears here as a lesson rather than a call.
David Tepper sold his position in the second quarter — in what was fundamentally the best quarter the company had ever had. That is the whole point. Selling on strength, when every fundamental number is at its best, is nearly impossible to justify from a spreadsheet and is exactly what Terranova means by calling investing "tacit knowledge": some of what an experienced manager does cannot be written down as a rule, which is also why copying the rule rather than the judgment usually fails.
In short: The name most directly in the path of Chinese NAND. Apple "is evaluating DRAM from CXMT and NAND from YMTC… which pressured traditional memory players like SanDisk down 6% during the week," on top of "US potential chip sanctions and tariffs, which is why memory underperformed AI overall." The report's "Potential Reductions" is explicit: reduce exposure to traditional commodity memory suppliers (Micron Technology, SanDisk) facing margin compression from Chinese capacity ramp (CXMT, YMTC) and potential hardware tariff friction. The distinction he is drawing within memory is between the specified, contracted end of the market (HBM, server DRAM, the Nvidia procurement commitments) and the commodity end that a state-backed entrant can flood — SanDisk sits nearer the second.
SanDisk makes flash storage — the chips that hold data when the power is off. It fell 6% on the news that Apple is evaluating NAND flash from YMTC, a Chinese manufacturer, for products sold in China, on top of the threat of American chip tariffs. "Memory underperformed AI overall."
The report's list of positions to reduce names it explicitly, alongside Micron, on margin compression from the Chinese capacity ramp.
The distinction worth drawing is which end of the memory market a company sits in. The high-bandwidth memory that goes next to an AI accelerator is specified, contracted years ahead, and currently sold out — Nvidia's $160 billion increase in purchase commitments this quarter was mostly memory procurement. Ordinary storage for phones and laptops is a commodity: buyers compare price per gigabyte, switching costs are low, and a state-supported entrant that does not need a normal return on capital can take share simply by pricing below the incumbents.
SanDisk sits closer to that second market than Micron does, which is why it fell further on the same headline.
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In short: Paired with Micron as the handful of names carrying index earnings growth, and named as one of the AI-infrastructure longs in Aschenbrenner's blown-up book (with CoreWeave and SK Hynix). A gross-margin comp he tracks into Nvidia's print.
9:23optical stocks and in the whole ecosystem. And the problem was he was using leverage and this is why I always caution people on using leverage. He was using about four times leverage and had 45 billion of exposure. He was long AI infrastructure like CoreWeave, SK Hynix, SanDisk, and he was shorting software companies like Adobe.
In short: Back in the book: "we just saw SanDisk earnings, the stock absolutely rallied on that. We had been adding to that close to 1,000." The investor day guided to mid-to-high-teens revenue growth, ~80% non-GAAP gross margins and ~50% adjusted FCF margins, with 100% of excess cash returned to shareholders — "which was huge." The technology claim is the reason it matters for the AI trade: internal testing showed one HBF GPU running a model that required eight HBM GPUs (an 8× capex efficiency) and four HBF GPUs matching the token output of eight HBM GPUs (2× GPU efficiency). The stock was up 14%.
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In short: Raised by the host (2400 → 1000 → ~1300, still +450% on the year). Newton gave no view on the stock itself but on its group: "the entire memory space has broken back out versus equal weighted technology… it's actually on little bit better footing now. It's not going to be a straight shot back to the highs but I think it will take time."
SanDisk came up as the host's example of how violent the memory-chip cycle has been — from 2,400 down to 1,000, back to about 1,300, and still up roughly 450% on the year. Newton did not give a view on the company itself, so this row records a group call rather than a stock call.
His group view is mildly constructive: "the entire memory space has broken back out versus equal weighted technology" after falling behind since early June. Memory chips (DRAM and flash storage) are a commodity business — prices swing hard with supply and AI-driven demand — which is why the shares move in enormous ranges. He cautions that recovery takes time: "it's not going to be a straight shot back to the highs."
14:41It was trending down obviously since really early June. So it's actually on little bit better footing now. It's not going to be a straight shot back to the highs but I think it will take time. But certainly trading a little bit better over the last week and it's good to see for that part of the market.
In short: Third of the AI-hardware names Ackman has deliberately avoided; cited only in that list, as the counterpoint to a portfolio built entirely of network and aggregator businesses.
22:15We know that Bill Ackman has invested in all of these companies, the hyperscalers, the capex spenders, these digital network companies, but he doesn't own any Micron or Nvidia, he doesn't own any Sandisk, he's not in these AI companies. And he believes the outperformance of this subset of companies is likely temporary. He says, while the S&P 500 index has increased by approximately 10% through the first 6 months of the year, nearly the entirety of gains has come from two sectors that provide the picks and shovels for AI infrastructure. Just two of the S&P
In short: A blowout quarter that still sold off on guidance — revenue $8.97B vs $8.6B, +372% y/y, adjusted EPS $39.25 vs $34.45, a record 84.6% gross margin, data-center revenue +103% q/q — but 1Q27 guidance of $10.3-10.8B came in below the $11.1B estimate, "which is why the stock sold off." A new $14B buyback takes remaining capacity to $15.5B. He had exited the position at the prior week's peak.
A memory-chip maker riding the same shortage as Micron: revenue nearly quintupled year on year to $8.97 billion, with record gross margins of 84.6% — extraordinary numbers for a chip company.
The stock fell anyway, because guidance for the next quarter of $10.3-10.8 billion came in below the $11.1 billion analysts wanted. It is a clean illustration of a market that prices the future, not the past. The company also announced a $14 billion buyback. Singh had already sold his position at the prior week's peak.
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In short: AI eats NAND. Q4 (June quarter) revenue +372% Y/Y to $9.0B ($0.6B beat) with adjusted EPS $39.25 ($4.73 beat), non-GAAP gross margin at an extraordinary 85% and adjusted free cash flow of $5.0B at a 56% margin. Sandisk repurchased $4.5B of stock in the quarter — "a questionable decision after a 1,800% stock run-up." The driver is AI infrastructure: datacenter went from 12% of Sandisk's bits a year ago to 38% exiting FY26 on high-capacity enterprise SSDs, with management expecting NAND bits to stay on allocation beyond 2027. The durability attempt is the interesting part — eight multi-year "New Business Model" agreements with data-center and edge customers averaging more than four years and backed by $16.5B of financial guarantees, with more than half of FY27 bits and roughly two-thirds of FY28 production already committed. Q1 FY27 guided to $10.3–$10.8B (~18% sequential at the midpoint, though the midpoint fell short) with gross margin holding at 83–85% and EPS $44–$46. Bottom Line: "AI has turned NAND from a cyclical commodity into a bottleneck (at least for now)… The question is how much of today's extraordinary 80%+ gross margin survives once supply eventually catches demand."
Sandisk makes flash memory (NAND) — the chips inside storage drives. Its revenue rose 372% in a year to $9.0 billion, and 85 cents of every dollar of sales was gross profit. Those are not normal numbers for a memory company; they are shortage numbers.
The cause is AI. Training and running AI models requires enormous amounts of fast storage, and data-centre customers now take 38% of Sandisk's output, up from 12% a year ago. There isn't enough supply: management expects to be rationing chips to customers beyond 2027.
Historically this is exactly when memory investors get hurt — prices spike, everyone builds factories, supply floods in, prices collapse. Sandisk is trying to break that pattern by locking customers into long contracts: eight multi-year deals averaging more than four years, backed by $16.5 billion of financial guarantees, covering over half of next year's output and about two-thirds of the year after. In effect it is selling forward the shortage.
One odd decision: Sandisk spent $4.5 billion buying back its own shares after the stock had risen roughly 1,800% — buying high, which the newsletter flags as questionable.
Next quarter is guided higher again. The reason this is a neutral rather than a positive read is stated in the article itself: the whole question is "how much of today's extraordinary 80%+ gross margin survives once supply eventually catches demand." Analysis, not a recommendation.
In short: Dean opens with it as the market backdrop, not a pick: SanDisk, SK Hynix and "that entire memory complex and AI complex has been down 40, 50% over the last month and the market's really questioning if ROI is there anymore." Their answer is that the drawdown misreads open weights.
1:28But gentlemen, how about we start off with a broad view of the hyperscaler spending on AI, the consequences and your thoughts, because I know you really think this is a very big deal. — Yeah, it's very timely. I think SanDisk, Skhinx, that entire memory complex and AI complex has been down I think 40, 50% over the last month and the market's really questioning if ROI is there anymore.
In short: Named at the open as a drag on a red tech tape ("tech is weak… SanDisk and Western Digital are certainly a drag there"). No committee call.
In short: A clean round trip: +10 bps at $10.60 on July 28, then fully exited at the weekly peak (+30%) just before the Friday AI sell-off — "we sold almost perfectly." It was at a 5× forward PE at the capitulation low; reports Wednesday after the close.
A textbook round trip in a memory-chip name: bought a small slice at $10.60 on July 28 during the panic (when it traded at five times earnings), then sold the whole position at the top of a 30% weekly rally, just before the market rolled over again on the Friday. "We sold almost perfectly." He is out — not bearish, just flat after taking the money.
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In short: The flash leg of the same memory basket — +9% on Jul 21 with WDC/SK Hynix/Micron as Morgan Stanley called 25% memory price increases; trimmed into that spike and added back at the end of the week.
SanDisk (the flash-memory business spun out of Western Digital) rose 9% in the same July 21 memory rally alongside SK Hynix, Western Digital and Micron. Same handling as the rest of the basket: trimmed into the spike, added back at the end of the week, held as an expression of the memory-price squeeze.
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In short: A short-term trade — Argus starting/cutting SanDisk to hold caused a temporary selloff, "but we actually think short-term, SanDisk and Micron are both buys." A memory-cycle beneficiary caught in the AI washout.
SanDisk (flash-storage memory, recently split off from Western Digital) dipped when Argus rated it "hold," which helped trigger the week's AI selloff. Singh brushes that off — "frankly not a big deal" — and calls SanDisk and Micron "both short-term buys." Same idea as Micron: a tactical trade on cheap memory names caught in the panic, not a long-term position.
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In short: Named alongside Micron in the framing sentence — "Memory companies like Micron and SanDisk are currently making too much money" — and inside the +200 to +700% group. Cited as evidence of the cycle's position rather than analysed on its own merits.
In short: The other memory-scarcity winner — SanDisk and Micron are "both up over 200% in the second quarter alone" as investors chase semiconductor scarcity created by AI-data-center demand.
12:52Generally, they have chased scarcity. And where is there scarcity? In semiconductors of all kinds. That is why, for example, SanDisk and Micron are both up over 200% in the second quarter alone. By contrast, fears about AI continue to haunt poor software stocks and consulting companies. In software, Salesforce, Adobe, and Intuit were down 18%, 19% and 39% respectively.
In short: Wapner/Brown: a "power player" winning off Micron — memory-scarcity beneficiary, up big on the DRAM/NAND price surge.
In short: Another "explosive bottleneck performance" memory name — a multi-thousand-dollar share price "moving up hundreds of dollars per day"; cited as evidence of how far the AI-winner basket has run.
9:36Look at their last quarter. It looks like a mistake. It's not. This is truly how much their revenue is growing. But this is where all the excitement is. When we look at another company that's had this explosive bottleneck performance, we have SanDisk. It's a multi-thousand dollar share price. It's moving up hundreds of dollars per day.
In short: His jaw-dropper for how hot memory is (colleague's coverage): SanDisk just guided to a single-quarter EPS (~$31–32) higher than the entire stock price when it went public ~18 months ago.
3:36And the issue — Micron's up over well over 100. Oh, and look, you companies like like say a SanDisk or do my I don't cover, my colleague covers, but they just guided to a quarterly EPS that is higher than the stock price was when it went public like 18 months ago. And so this is what I find. Yeah. — Say it again slowly.
In short: Grouped with Micron as a memory name riding a one-time demand wave — "I'm not buying SanDisk."
9:02These include memory stocks, Micron, SanDisk, you name it. The companies that have gone up like 10x because memory is really expensive. Now, it is true that Micron is a great company today. The stock is up above a trillion dollar market cap. Many investors have priced it with a much higher multiple.
In short: The pure-NAND name in his memory trio — the powerful NAND cycle "we haven't talked about in a decade," now highly profitable and de-risked by LTAs.
SanDisk is a pure NAND-flash memory maker (the chips used for storage in phones, laptops, and data centers); it returned to the public market in 2025 as a stand-alone company. Shaulov uses it as the cleanest way to play the NAND cycle he says has been dormant "for a decade."
His view is that NAND is entering a powerful, highly profitable upturn, de-risked by long-term supply agreements — the kind of neglected cycle where the move can be large because so few investors are positioned for it.
11:43You've got memory companies like Hynix, Micron, SanDisk. What's the last time we talked about a NAND cycle? Must be a decade ago. And it's a powerful cycle. The profitability of these businesses is absolutely enormous. And if you look at forward CapEx indicators — historically how profitable the customers are leads to forward CapEx.
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