SanDisk cuts dozens of jobs in Israel despite AI-fueled surge
The memory-chip company is worth $230 billion after a 3,500% stock rally, but employees at its Israeli development centers have been laid off.
SanDisk has laid off dozens of employees at its development operation in Israel. The exact number of layoffs is not yet known.
The cuts affect development workers across several departments and come as a surprise to employees given SanDisk's exceptionally strong financial performance and the surge in demand for flash memory driven by artificial intelligence.
SanDisk operates three development centers in Israel, in Kfar Saba, Tefen and Omer, employing around 700 people. The Israeli operation, which includes activities that originated with Dov Moran's M-Systems, focuses on core flash-memory technologies including chip design, error-correction algorithms and storage systems.
SanDisk's shares have risen roughly 3,500% over the past year, climbing from around $37 in August 2025 to nearly $1,600 today. The rally has pushed the company's market value to approximately $230 billion.
The surge has been driven by the sharp increase in demand for flash storage from AI and cloud data centers. Earlier this month, SanDisk reported quarterly revenue of about $9 billion, almost five times the figure a year earlier, and net profit of approximately $6.9 billion.
The company also reported an order backlog of $91 billion, most of it tied to long-term contracts with major cloud and AI companies. AI server farms accounted for 38% of total revenue, up from 12%, while operating cash flow reached $7.1 billion.
Despite the strong results, SanDisk's shares fell after the earnings release because its forecast for the following quarter fell short of investors' expectations.
The layoffs in Israel have also drawn attention because they come only months before SanDisk is expected to launch an employee stock purchase plan. The plan will allow employees to purchase company shares at a significant discount using their salaries. Given the sharp rise in SanDisk's stock, the potential discount could amount to hundreds of dollars per share.
The timing has caused frustration among some employees, although there is no indication that the stock purchase plan was a factor in the layoffs.
SanDisk was founded in 1988 by Israeli entrepreneur Eli Harari. The company acquired M-Systems, founded by Moran, for $1.6 billion in 2006. SanDisk was later acquired by Western Digital and returned to the public markets in February 2025 through a Nasdaq listing.
