Western Digital (WDC) shares plummeted 8.63% during intraday trading on Tuesday, extending a sharp selloff as a confluence of negative catalysts battered the memory and storage sector.

The decline was driven by intensifying doubts over the AI boom, which has fueled demand for memory chips. Bearish rumors in the NAND industry further weighed on sentiment, including reports that SanDisk signed a low‑price long‑term supply agreement with Meta, cloud vendors are pressuring QLC enterprise SSD pricing, and procurement demand from Chinese cloud service providers is weakening. Adding to competitive fears, Chinese memory chip maker ChangXin Memory Technologies (CXMT) saw its shares surge 466% on its blockbuster trading debut, while a state‑backed Chinese company began mass‑producing immersion deep ultraviolet lithography machines, signaling China’s accelerating push for semiconductor self‑sufficiency.

Compounding the rout, Morgan Stanley warned that memory contract prices may peak in the fourth quarter, suggesting the AI‑driven storage boom is approaching an inflection point. These developments triggered broad‑based profit‑taking across storage names, with Western Digital bearing the brunt of the selloff.