SanDisk Reports Strong Q1 Revenue Outlook as AI Storage Demand Drives Record Quarterly Revenue!
SanDisk reported its fiscal fourth-quarter results on Wednesday, with fourth-quarter revenue reaching US$8.97 billion, up 51% quarter-on-quarter and 372% year-on-year. Approximately one-third of the growth was driven by higher shipment volumes, while the remaining two-thirds came from stronger average selling prices.
Benefiting from higher product pricing and robust demand for data center storage products, both revenue and profit surged during the quarter. The company also expects sequential revenue growth to continue next quarter, supported by sustained spending on AI-related storage infrastructure. SanDisk stated that, driven by a customer mix shift toward higher-value clients and improved pricing, full-year fiscal 2026 revenue increased 175% year-on-year to US$20.25 billion. Revenue from its data center business soared 437% for the full year, highlighting continued expansion in demand for AI infrastructure and enterprise storage solutions.
By business segment, fourth-quarter data center revenue more than doubled sequentially to US$2.98 billion. Edge computing revenue rose 48% quarter-on-quarter to US$5.43 billion, while consumer business revenue declined 32% sequentially to US$556 million.
Looking ahead, SanDisk expects fiscal 2027 first-quarter revenue to be between US$10.3 billion and US$10.8 billion. Non-GAAP diluted earnings per share are projected to range from US$44.00 to US$46.00, while gross margin is expected to be between 83.0% and 85.0%.
In addition, the company expanded its capital return program. The board approved an additional US$14 billion share repurchase authorization, increasing the remaining buyback capacity to US$15.5 billion. SanDisk also noted that since its April earnings release, it has signed five additional commercial model agreements, bringing the total number of newly announced agreements during that period to ten.
SanDisk shares fell in after-hours trading. The decline came after a strong rally over the previous two trading sessions, as investors had already priced in much of the positive expectations. Elevated market expectations proved to be the key constraint. Wall Street consensus forecasts called for adjusted earnings per share of approximately US$34 to US$35and revenue of around US$8.3 billion to US$8.4 billion, both significantly above management's own guidance of US$30 to US$33 in earnings per share and US$7.75 billion to US$8.25 billion in revenue. As a result, any earnings that failed to significantly outperform those lofty expectations were likely to be viewed as disappointing by the market.
Market Insight:
SanDisk's long-term investment thesis remains intact, supported by AI-driven NAND demand growth, long-term supply agreements, and its collaboration with SK hynix on a new high-bandwidth flash memory standard. Market attention has now shifted toward the company's upcoming Investor Day on August 13.
