TLDR
- SanDisk shares spiked 17% in pre-market trading after fiscal Q2 revenue reached $3.03 billion, exceeding the $2.69 billion analyst forecast
- Net income exploded 672% to $803 million as data-center revenue grew 76% year-over-year on AI infrastructure buildouts
- The company projected Q3 revenue of $4.6 billion and EPS of $14, both roughly double Wall Street’s $2.9 billion and $5.11 estimates
- SanDisk and Kioxia Corp extended their flash chip supply agreement through 2034, adding nine years to the partnership
- CEO David Goeckeler said supply shortages will persist through 2026 as customers prioritize securing inventory over price
SanDisk stock exploded higher Friday morning, jumping 17% in pre-market action after the company reported quarterly results that blew past every analyst estimate. The flash storage provider continues benefiting from the AI infrastructure buildout sweeping through the tech sector.
Fiscal second-quarter revenue came in at $3.03 billion, crushing the $2.69 billion consensus. Net income hit $803 million, or $5.15 per share, representing a 672% surge from the year-ago period. Wall Street had expected adjusted earnings of $3.33 per share.
The stock has rallied over 125% so far in 2026. Shares now trade above the average analyst target of $395.93.
SanDisk manufactures flash storage memory that goes into solid-state drives used throughout AI data centers. These drives hold the enormous datasets that AI systems tap into when responding to user queries.
The company’s data-center segment generated 76% more revenue than last year. CEO David Goeckeler explained that AI companies are building specialized facilities for inference workloads, which require constant access to stored information.
Tight supply conditions are working in SanDisk’s favor. Goeckeler said buyers are willing to accept higher prices to guarantee delivery. “Customers prefer supply over price,” he noted in an interview with Reuters.
Nine-Year Supply Agreement Locks In Capacity
SanDisk strengthened its supply chain position by extending its partnership with Kioxia Corp. The two companies pushed their flash chip supply deal through 2034, adding nine years beyond the previous 2029 end date.
“We have incredible capacity in Japan that we’ve been investing in, and we continue to invest in,” Goeckeler said. “Now we’re signed up together for another nine years.”
The extended agreement guarantees access to joint venture manufacturing sites in Japan. This capacity will support SanDisk’s growth plans as AI demand continues climbing.
Management said current production cannot keep pace with incoming orders. The company expects this supply-demand imbalance to extend throughout 2026, maintaining pricing strength.
Guidance Stuns Analysts
SanDisk’s forward outlook delivered the biggest surprise of the report. The company forecast third-quarter revenue with a $4.6 billion midpoint, nearly double the $2.9 billion Street estimate.
Earnings guidance was equally aggressive. SanDisk projects adjusted profit between $12 and $14 per share for the current quarter. Analysts had modeled just $5.11 per share, creating a gap exceeding 150%.
The forecast suggests AI-driven demand is intensifying. Flash storage has operated in the shadow of DRAM memory during chip shortage discussions, but supply constraints are now affecting both memory types.
Profit margins are expanding alongside revenue growth. The 672% earnings jump demonstrates strong operational leverage as production volumes increase.
Wall Street maintains a Moderate Buy rating, with 10 Buy and four Hold recommendations over the past three months. Analyst coverage will likely be revised following these results.
The Kioxia supply agreement now runs through the end of 2034, providing nearly a decade of secured flash chip manufacturing capacity.
