SAN FRANCISCO, Feb 3, 2026, 08:06 PST
SanDisk projected fiscal third-quarter revenue between $4.4 billion and $4.8 billion, with non-GAAP earnings expected at $12 to $14 per share, it said Tuesday. The company also anticipates a gross margin ranging from 65% to 67%. Shares jumped over 9% in after-hours trading. For the second quarter, SanDisk posted revenue of $3.025 billion, non-GAAP EPS of $6.20, and a gross margin of 51.1%. It generated $843 million in adjusted free cash flow and paid down $750 million in debt. Additionally, SanDisk agreed to spend $1.165 billion on manufacturing services from 2026 through 2029, extending its Yokkaichi joint venture with Kioxia to December 31, 2034.
NAND flash, the storage memory powering solid-state drives in data centers, phones, and PCs, has a history marked by wild swings. This time, though, the buyers and the length of their planning horizons stand out as unusual.
International Data Corporation (IDC) labeled it an “unprecedented memory chip shortage,” driven by AI data centers where demand keeps outpacing supply. Shares of Micron Technology, Western Digital, and Seagate Technology rose Monday, with SanDisk jumping 16%, according to Business Insider. Apple CEO Tim Cook confirmed memory prices are climbing and said the company is in “supply chase mode.” Business Insider
On SanDisk’s earnings call, CEO David Goeckeler talked about a push for “shared commitments” as data centers are set to become the biggest market for NAND by 2026. Bernstein’s Mark Newman noted prices were “rebounding extremely at unprecedented rates” and questioned whether long-term contracts might limit upside if prices keep climbing. CFO Luis Visoso said customers are coming from “across end markets and across geographies,” with the company weighing factors like deal length, price, volumes, and any prepayment terms. Investing.com
Long-term deals matter because they shift risk. They provide a supplier with steadier cash flow and support bigger capital investments, but they also risk locking in terms right as the cycle hits its peak.
Buyers aren’t just hunting for small discounts—they’re focused on securing any parts at all. As AI models expand and inference tasks shift from testing to full-scale production, data centers are gobbling up more storage. That surge is squeezing the entire electronics supply chain.
The sector’s trend is clear. Western Digital’s board greenlit an extra $4 billion for share buybacks, citing strong demand for memory chips in AI servers.
Still, this remains a cyclical industry with a fresh look. Any dip in demand, quicker supply growth, or changes in cloud budgets could ease pricing pressures. Multi-year contracts inked during a tight market might look out of place if conditions ease up.
Simply Wall St reported that SanDisk’s latest quarter flipped to a net profit of $803 million, a sharp recovery from a $23 million loss the previous quarter. Despite this, the company still carries a trailing 12-month loss of $1.0 billion. The site highlighted that this stark turnaround leaves investors weighing whether the recent jump signals a new normal or just another volatile swing in the cycle.
Key indicators to watch now: if SanDisk secures additional supply deals, and whether the AI-fueled demand it’s experiencing will hold up pricing as new capacity ramps up.
