Yes, you waste a lot of memory. Memory's cheap. If you need to, you can do the computation in blocks. Well, it's pretty rare to actually run out of memory but blocking is useful for staying at a lower cache level.

Scalar languages have a different problem: the default is to process one value at a time, which wastes the potential parallelism that array languages take advantage of with SIMD algorithms. Because this is the status quo, it's not as easy to see this as a big concern. And the solution is also blocking. That is, the best algorithm for SIMD-friendly stuff is generally a blocked array method.

In practice, whether an array language is good or not really depends on the specific problem. Of course, for most practical uses performance doesn't matter at all; I believe k's reputation mostly comes from kdb being fast as a database rather than k implementations being fast languages. But array languages can be surprisingly fast just by focusing on elegant array algorithms rather than machine-specific considerations. I have comments and benchmarks comparing with C here:

https://mlochbaum.github.io/BQN/implementation/versusc.html