Karla Barker 
South Korean chipmakers are starting the week with a new set of expectations on their hands. Samsung Electronics and SK Hynix closed sharply higher on Friday after SanDisk outlined long-term profit targets that suggest the AI memory boom could last longer than many assumed. South Korean markets are closed Monday for Liberation Day, so the first real test will come on Tuesday.
Friday’s move was notable. Samsung rose 2.43% to 274,500 won, while SK Hynix climbed 3.26% to 1.645 million won. The KOSPI finished up 2.41% at 6,977.34. That rally did not come from nowhere. SanDisk’s investor day gave investors a reason to rethink the usual boom-and-bust pattern in memory chips.
SanDisk’s 80% margin target shifts the debate
The memory industry has always followed a rough cycle. High prices lift profits, profits fund new capacity, and new capacity eventually crushes margins. SanDisk is making the case that this time may be different. The company expects revenue growth in the mid-to-high teens from fiscal 2028 through 2030, with non-GAAP gross margins around 80% and operating margins near 75%.
That kind of forecast is stunning for a sector known for violent swings. JPMorgan’s Harlan Sur said SanDisk is especially well placed to benefit from AI inference demand for NAND. He also argued that longer customer agreements could reduce the volatility that has defined memory markets for years.
Morgan Stanley’s Joseph Moore was bullish but cautious. He believes SanDisk could keep margins at or above those levels for several years while shortages last, though he questioned whether 75% operating margins are sustainable in the long run. That hesitation matters.
Wall Street sees a long memory shortage
Other analysts are even more aggressive on the shortage side. Macquarie Capital describes the current situation as the worst memory crunch in history and sees no sign of supply constraints easing over the next three years. The firm points to AI inference-related demand for memory as exceptionally strong and expects Samsung and SK Hynix to lead a recovery in the Korean market.
Inference is worth paying attention to. Running AI models at scale needs huge amounts of memory and storage, not just computing power. Data centers are consuming more HBM and DRAM, while NAND demand rises as operators look for cheaper ways to store the growing volume of AI-generated data.
Bernstein’s Mark Newman also sees room for NAND demand to expand further. He expects SanDisk’s planned high-bandwidth flash to become a major growth driver, partly because it would use more wafer capacity and keep supply conditions tight for longer.
The old cyclical risk has not disappeared
Still, none of this means the memory cycle is gone. High prices create strong incentives for manufacturers to add capacity, and if supply catches up faster than expected, today’s margin assumptions could look too optimistic. SanDisk’s 80% gross margin target leaves little room for disappointment.
The same logic applies to Samsung and SK Hynix. Both stand to gain if AI infrastructure spending keeps absorbing new capacity. But the more profitable the industry becomes, the harder it will be to avoid new investment that eventually changes the balance. For now, analysts are leaning bullish, but the risk is still there.