Shares of Seagate Technologies fell over 8% on Monday, leading a broader decline in the memory chip sector after CEO Dave Mosley expressed concerns about the company’s ability to meet surging demand driven by artificial intelligence investments. At a JPMorgan conference, Mosley indicated that ramping up production capacity would take too long, potentially hindering growth in technology advancements. This sentiment weighed heavily on other memory chip stocks, with Micron down 5% and both SanDisk and Western Digital Corporation dropping around 7%.

The comments come at a time when memory chip stocks have previously surged due to increased AI-related demand, raising questions about the sustainability of this growth. Investors are now cautious about the production timelines and capacity constraints faced by leading manufacturers, as the chip production cycle can extend over multiple quarters.

One key takeaway for market professionals is the launch of CME Group’s new semiconductor futures market, which will provide traders with tools to hedge against rising prices and manage exposure to the volatile memory chip sector.

Source: cnbc.com