Sandisk Corporation
SNDK · Nasdaq
Next quarter
Expected to report Jan 28, 2027 — estimated from last year’s reporting date.
Consensus is $51.79 EPS for Dec 2026 across 4 estimates, ranging $46.87 to $56.32.
SNDK Sep 2026
- 5.91%
- -13.47%
- $46.19
- $48.92
- —
- $11.03B
Reported results
- $11.03B
- $8.78B
- $8.10B
- $52.60
Highlights
- Revenue and margins: Fiscal Q1 2027 revenue was $11.03 billion, up 23% sequentially and 378% year over year; non-GAAP gross margin reached 85.1%, up 0.5 percentage point sequentially.
- Earnings: Non-GAAP diluted EPS was $49.51, above company guidance of $44–$46 and the supplied $46.19 consensus; GAAP diluted EPS was $52.60. GAAP net income included a $513 million gain on equity securities.
- Data center acceleration: Data center revenue rose 61% sequentially to $4.80 billion, as Sandisk increased supply to meet strong demand and grew faster than the market.
- Long-term customer commitments: Remaining performance obligations under New Business Models (NBMs) reached $88.9 billion; about 50% of FY2027 bits and two-thirds of FY2028 bits are under NBM agreements.
- Cash generation and buybacks: Adjusted free cash flow was $5.70 billion, or a 51.6% margin. Sandisk repurchased about 3.2 million shares for $5.0 billion and ended the quarter with $5.1 billion in cash and no debt.
- End-market mix: Edge revenue increased 7% sequentially to $5.83 billion, while Consumer revenue fell 29% to $397 million as customers adjusted to higher prices.
- Q2 outlook: Sandisk guided to revenue of $12.2–$12.6 billion, non-GAAP gross margin of 84.5%–85.5%, and pre-split non-GAAP EPS of $55–$57.
- Technology roadmap: Sandisk taped out its first High Bandwidth Flash (HBF) memory die and began fabrication; it remains on track to sample the first HBF-based products next calendar year.
Analysis
Sandisk’s fiscal Q1 2027 was a sharp step up in both scale and profitability, led by AI-related data-center demand and higher pricing. Revenue of $11.03 billion grew 23% from Q4 FY2026’s $8.97 billion and 378% from the year-ago $2.31 billion. Non-GAAP EPS of $49.51 exceeded company guidance of $44–$46 and the supplied $46.19 consensus; it was up 26% sequentially from $39.25. GAAP EPS was $52.60, with GAAP net income of $8.10 billion including a $513 million equity-securities gain. Non-GAAP gross margin was 85.1%, compared with 84.6% in the prior quarter and 29.9% a year earlier.
The defining drivers were data-center growth, expanding multi-year customer commitments and exceptional cash generation. Data-center revenue rose 61% sequentially to $4.80 billion, while Edge grew 7% and Consumer declined 29%. Management attributed about 60% of sequential revenue growth to volume and 40% to pricing. Adjusted free cash flow was $5.70 billion, and the company returned $5.0 billion through repurchases. For Q2, Sandisk forecast $12.2–$12.6 billion in revenue and $55–$57 in pre-split non-GAAP EPS, with modest further pricing improvement expected.
Data center growth
Data center was the quarter’s clearest growth engine: revenue of $4.80 billion increased 61% sequentially and substantially outpaced the market. Management cited strong customer demand, allocation of more supply to the segment, and its enterprise SSD portfolio, including the ramp of QLC products alongside established TLC offerings. It also linked performance to BiCS8 technology and customer work on AI inference architectures. Management expects data center to remain the growth engine in calendar 2027, when it sees industry bit demand growing about 40% after more than doubling in 2026.
NBM commitments
Sandisk is using multi-year New Business Models to gain better demand visibility and support production planning. Two NBM agreements closed during the quarter, and management said the pipeline exceeds supply through the end of the decade, with customer signals extending beyond 2030. About 50% of FY2027 bits and two-thirds of FY2028 bits are under NBM agreements, and management expects the committed share to rise. The filing reported $88.9 billion of remaining performance obligations, of which $87.4 billion had not been billed and $1.5 billion was recorded as contract liabilities; about 20% is expected to be recognized over the next 12 months. The $12.8 billion of collateral held by third parties is not recorded as an asset and is available only under specified default or breach conditions.
End-market mix
- Data center: Revenue increased 61% sequentially to $4.80 billion, reflecting strong demand and increased supply allocation.
- Edge: Revenue rose 7% to $5.83 billion. Management cited resilience in premium and mainstream markets, partially offset by weakness at the lower end; automotive and IoT customers were areas of strength.
- Consumer: Revenue fell 29% to $397 million as the market adjusted to higher prices.
Cash and capital returns
Cash from operations was $6.36 billion and free cash flow was $6.31 billion. Adjusted free cash flow, which adjusts for Flash Ventures activity and NBM prepayments and deposits, was $5.70 billion, a 51.6% margin. Sandisk spent $5.0 billion to repurchase approximately 3.2 million shares; over the past two fiscal quarters it repurchased 6.0 million shares, about 4% of shares outstanding. It ended the quarter with $5.14 billion of cash and no debt. Gross capital spending was $378 million, and management expects it to rise during the year to a mid-single-digit percentage of FY2027 revenue.
Outlook and technology
For fiscal Q2 2027, Sandisk guided to revenue of $12.2–$12.6 billion, non-GAAP gross margin of 84.5%–85.5% and pre-split non-GAAP EPS of $55–$57, assuming approximately 151 million diluted shares. Management expects both volume and modest price increases to contribute. On the product roadmap, the first HBF memory die reached tape-out and fabrication is underway; initial product samples are expected next calendar year. Sandisk also announced an 8-for-1 forward stock split, with split-adjusted trading expected to begin November 20, 2026.
