Stock Market Insights: AI’s hidden winners: How memory and storage stocks are driving market gains – BizTimes.biz

I took my wife to the beach over the weekend, and she thought she had left our sunscreen at home. We were at a remote resort in Costa Rica with no stores nearby. I went to the little resort gift shop to buy sunscreen, only to find it cost $50, which I was too cheap to buy. It was a sunscreen monopoly very similar to one happening right now to AI memory and storage products.

I don’t think the technology sector, with its strong earnings outlook, is being fully appreciated in the markets due to skepticism surrounding artificial intelligence. I know what you are thinking; technology is always getting attention. It’s like saying the Yankees aren’t getting enough attention.

Despite several years of outperformance in the technology sector, AI’s valuations are pretty good compared to the rest of the market, given its strong growth and profitability. Though it’s still to be determined when AI will start making enough profits to justify all the huge investment. The massive amount of spending is not just continuing but increasing, pushing technology to a continued earnings boom.

Often, discussions about technology focus on AI chips, but memory and storage stocks have been key drivers of the market’s recent record highs. For example, Seagate Technology (STX), Western Digital (WDC) and SanDisk (SNDK), which all reported earnings this week, posted shocking stock gains last year and have continued to rise so far in 2026.

Seagate Technology is a global manufacturer of data storage products. They specialize in hard disk drives, solid-state drives and storage systems. Its shares are up more than 600% over the last year. On Tuesday, April 28, Seagate reported a 44% increase in revenue over the same quarter last year, and its stock rose another 15% the following morning.

Western Digital manufactures data storage solutions, including hard disk drives for data centers, personal computers and surveillance. Its stock is up over 880% over the last 12 months.

SanDisk, which you might recognize from your camera’s SD card, spun off Western Digital last year and makes high-density Enterprise Solid-State Drives for data centers, cloud services and other memory storage solutions for computers, gaming consoles and phones. Its stock is up more than 3,100% in the last year. (This is why your new laptop costs so much more than normal.)

The massive demand for AI data centers, which require large amounts of memory and storage, has created a severe supply shortage, driving up prices for memory components. This has led manufacturers to raise prices and data center developers, who seem flush with cash, to fight over the limited number of products. This boosted profits beyond expectations.

While this is a great story of stocks going crazy, can it continue? Investors need to watch for more than just another story of beating earnings and see whether these companies are still this valuable once the supply chain isn’t so tight and they can’t continue price gauging. They might be. Especially if the AI boom has transitioned from the chip faze to the memory faze.

This is just one small part of the technology sector. If the economy continues to expand as I expect, the technology sector might be well-positioned to maintain earnings growth and outperform.

We didn’t buy sunscreen because we were too cheap, and we, of course, got completely sunburnt. So that night, we hiked into town to pay $40 for sunscreen and $13 for aloe vera. Two frustrating things about that: First, it would have been cheaper to pay the high price for the sunscreen and not get sunburned and needed both sunscreen and aloe vera, and second, once we got back to the room to apply aloe vera, my wife found the sunscreen she had packed in her bag that was overflowing with too many clothes. It seems sunscreen and AI memory are both worth the money.

Have a blessed week.

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This article was written by humans for humans because AI doesn’t have this quality of sarcasm.

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