Analysts Say Don’t Panic: Micron and Sandisk Are a Buy After the Google TurboQuant Selloff

TLDR

• Micron and Sandisk shares fell sharply after Google revealed its TurboQuant algorithm, which compresses AI memory use by at least 6x
• Investors feared TurboQuant would lower demand for memory chips, pushing both stocks down over 15% from recent all-time highs
• Mizuho analyst Vijay Rakesh says the selloff is overdone and reiterated Outperform ratings on both stocks
• Rakesh argues performance improvements like TurboQuant actually accelerate AI adoption, which boosts memory demand — a pattern known as Jevons’ Paradox
• NAND memory content in AI servers has doubled in the past year, and spot pricing keeps rising each quarter

Micron and Sandisk stocks sold off last week after Google published details on TurboQuant, a compression algorithm that shrinks the memory footprint of AI models by at least six times. The algorithm also boosts inference speeds up to eightfold, without hurting model accuracy.

The market read this as bad news for memory chip makers. Less memory needed per AI model could mean less demand for chips from companies like Micron and Sandisk.

Both stocks have fallen at least 15% from their all-time highs set late last month. On Thursday, Sandisk was trading down 5.9% at $652, while Micron dropped 5.5% to $347.78.

Sandisk Corporation, SNDK

Adding to the pressure, President Trump’s Wednesday evening address left investors uncertain about the timeline for ending the Iran conflict, which weighed on broader market sentiment heading into Thursday’s session.

TurboQuant was first explored in 2025, with newer results on AI inference performance published more recently by Google researchers.

Why Mizuho Says the Selloff Is Overdone

Mizuho Securities analyst Vijay Rakesh pushed back on the market’s reaction in a note to clients. He reiterated Outperform ratings on both Micron and Sandisk and kept his price targets at $530 and $710 respectively.

His core argument is that efficiency improvements in AI have historically led to more spending, not less. This idea is known in the industry as Jevons’ Paradox — when a resource becomes cheaper or more efficient to use, total demand for it tends to go up, not down.

Rakesh pointed to three past examples. Virtualized machines were expected to reduce server demand but had the opposite effect. The DeepSeek launch in 2025 sparked fears of a GPU slowdown, but AI infrastructure spending kept growing. The shift from copper to optical networking, which offered 10x higher bandwidth, was expected to cut costs but instead drove higher AI server capital expenditure.

NAND Demand and Pricing Remain Strong

Rakesh noted that NAND memory content in AI servers has doubled over the past year. Spot pricing has continued to rise each quarter.

With both price increases and strong underlying demand, Mizuho believes Micron and Sandisk could beat already-high earnings estimates going forward.

Sandisk is currently trading around $652, against Mizuho’s $710 price target. Micron is near $347, with a $530 target from the same firm.

The post Analysts Say Don’t Panic: Micron and Sandisk Are a Buy After the Google TurboQuant Selloff appeared first on CoinCentral.