As the leader of the world's highest-valued company, Jensen Huang's speech at the Consumer Electronics Show (CES) in Las Vegas this week once again affirmed his immense influence within the tech industry—his mere two sentences dictated the fate of two major AI-related sectors in Tuesday's U.S. stock market: the storage sector heated up further due to his comments, while cooling equipment stocks plunged into an icy abyss.
SanDisk Corp. surged nearly 28%, leading a significant rally in storage stocks. Data showed that after Huang emphasized the industry's demand for memory and storage at CES, SanDisk's stock price soared 28% on Tuesday, marking its best performance since February. The stock has shown strong momentum recently—it surged over 47% in the first three trading days of 2026 and has skyrocketed 1080% since hitting bottom on April 22. On Tuesday, its gains led the S&P 500 components, followed by two other storage device manufacturers, Western Digital and Seagate Technology, which also posted double-digit percentage increases.
In his Tuesday speech, Huang stressed the demand for memory and storage in AI systems, stating, "This is a market that never existed before, and this market is likely to become the world's largest storage market, essentially hosting the running memory for global artificial intelligence." According to industry analyst Jake Silverman, supply constraints and soaring memory prices are helping to boost storage stocks against the backdrop of growing demand for AI training and inference. He noted that Huang's comments at CES "indicate that demand for NAND chips across NVIDIA's various systems will remain strong."
Global memory prices have been climbing sharply in recent weeks. Earlier this week, industry reports suggested that Samsung Electronics and SK Hynix are seeking to increase server DRAM prices by 60% to 70% in the first quarter compared to the fourth quarter of last year. A team of analysts at Bank of America, led by Wamsi Mohan, wrote in a January 4 report to clients that SanDisk and other memory and storage companies are seen as "key beneficiaries" driving "AI inference and edge AI" in 2026. Mohan expects that organizations will retain increasing amounts of data for training, analysis, and compliance purposes, with storage demand "surging in parallel." He specifically highlighted growing applications in drones, surveillance, vehicles, and sports technology.
While some rejoiced due to Huang's speech, others naturally faced concerns—stocks of cooling system manufacturers were broadly sold off on Tuesday. Johnson Controls fell 6.2%, marking its worst day since last July. Modine Manufacturing Co. recovered some losses after plunging as much as 21% intraday, ultimately closing down 7.5%. Trane Technologies PLC declined 2.5%.
The decline in cooling equipment stocks stemmed solely from Huang's Tuesday statement that server racks equipped with the new Rubin chips could be cooled without the need for water-chilling units. This is one of the core thermal innovations of the Rubin platform, potentially significantly reducing data center cooling costs. Industry analysis indicates that chilling units are primary equipment supplied by companies like Johnson Controls and Trane Technologies to data centers. It can be said that Huang's remarks struck at the vital artery of these cooling equipment firms.
Baird analyst Timothy Wojs noted in a client report, "These comments raise questions about the long-term positioning of water chillers in data centers, especially as liquid cooling technology becomes increasingly prevalent." He added that current liquid cooling technology allows systems to operate at higher temperatures. Although Wojs sees limited risk to near-term earnings expectations for cooling equipment firms, he anticipates "the news will spark additional concerns about orders, particularly in the second half of 2026."
Last year, investors eager to capitalize on the AI boom flocked to buy stocks of companies producing cooling equipment for AI chip racks. Johnson Controls' stock surged 52% in 2025, while Vertiv, which also produces cooling systems and power equipment, saw its shares rise 43%.
Of course, some industry insiders currently believe there is no need to be overly pessimistic about the prospects of these cooling equipment stocks yet. Citi analyst Andrew Kaplowitz told clients that the investor sell-off in cooling equipment stocks was "overdone." He pointed out that cooling system manufacturers have cooperative relationships with chipmakers and data center operators, and the risk of these companies falling behind the times is manageable as data center technology evolves. Kaplowitz stated, "While we acknowledge that the comments regarding Rubin highlight the rapid evolution of thermal management technology in data centers, we do not believe this will catch our clients off guard."
Barclays analyst Julian Mitchell noted that Vertiv "holds a strong position in the liquid cooling field" and might benefit from the technological developments mentioned by Huang, although its chiller business could suffer. The company's stock closed up 0.6% on Tuesday, reversing earlier losses. Mitchell wrote in his report, "Given NVIDIA's dominant position across the entire AI ecosystem, investors should not underestimate the impact of its comments, even if they appear dramatic at first glance."
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