SK Hynix, Samsung Shares Dip In Korea After DeepSeek Debuts AI Tech That Uses Less Memory – Micron, SanDisk Hold Up

SK Hynix and Samsung Electronics shares fell 2.2% and 3.5% respectively after DeepSeek reduced high-bandwidth memory requirements in its AI models, raising demand concerns. Despite cheap valuations and strong earnings, volatility persists. Investors see this as a short-term setback, with long-term demand expected to rise from other AI models.

Samsung Electronics and SK Hynix shares fell over 3% after DeepSeek unveiled its V4.1-Flash AI model, which significantly reduces memory requirements. The model uses 890 bytes of cache per token, a quarter of its predecessor's usage. DeepSeek's innovation could impact memory demand, affecting companies like Micron and SanDisk. DeepSeek is preparing for a Shanghai listing and recently raised funding at a high valuation.

SanDisk's 2,107% one-year surge, driven by AI storage demand, has reclassified Apple and Microsoft as value stocks in indexes, according to Morningstar. SanDisk reported $20.2B revenue for fiscal 2026, with analysts targeting $2,125 and a $15.5B buyback authorized. Its performance has increased tech weighting in value indexes to 20%.

South Korea's KOSPI index fell 1.76% to 6,909.91 as Samsung Electronics and SK Hynix dropped over 3% each. The decline followed DeepSeek's announcement of an AI model requiring less high-bandwidth memory, raising concerns about demand for HBM chips. Both companies are down over 25% from their all-time highs, with high volatility affecting the KOSPI.

SanDisk (SNDK) stock surged 2,440% in 2026, reaching $2,354 before retreating to $1,692. CEO David Goeckeler attributed growth to a focus on NAND flash memory. Q3 revenue rose 372% to $8.97B, with 84.6% gross margins. Long-term contracts with data centers total $93.9B. Insider sales and competition from Chinese manufacturers pose risks. Analysts' price targets range from $1,400 to $2,450.

Samsung responded to Apple's $1,999 iPhone Duo launch with a social media campaign highlighting its seven-year lead in foldable smartphones. Samsung's posts, which gained millions of views, teased Apple's late entry and similar design. Apple's foldable iPhone starts at $2,460 in Korea. Counterpoint Research projects Apple to capture 25% of the foldable market, while Samsung is expected to hold 38%.