Shares of Sandisk (NASDAQ:SNDK) jumped 24% on Friday after the data storage maker posted quarterly results that crushed expectations and issued a forecast far above Wall Street estimates, driven by strong demand for NAND products tied to artificial intelligence infrastructure and data centres.
The rally lifted Sandisk’s gains since its market debut to about 1,755%.
Sandisk reported second-quarter sales of $3.03 billion, beating analysts’ estimates of $2.64 billion, while adjusted earnings per share came in at $6.20, nearly double the consensus estimate of $3.33. Net income rose to $967 million, compared with expectations of about $498 million.
The company said demand for its NAND products continued to outpace supply, supported by strong pricing and richer storage configurations across multiple end markets.
Bank of America analysts said Sandisk exceeded its own guidance for the quarter and issued a third-quarter outlook that was “massively above Street expectations,” citing both volume growth and sharply higher pricing.
Bit shipments rose by low single digits in the quarter, while average selling prices per gigabyte climbed by the mid-30% range, the analysts said. Data centre revenue jumped 64% quarter-on-quarter, with strength extending beyond cloud hyperscalers to enterprise and edge data centres.
“Demand was strong across the board,” Bank of America wrote, adding that replacement cycles and AI adoption in personal computers and mobile devices were driving higher storage content per device.
Gross margin reached 51.1% in the second quarter, well above the company’s through-cycle margin target of 35%. Sandisk guided for a gross margin midpoint of 66% in the March quarter, which Bank of America said was “meaningfully higher” than historical levels.
For the third quarter, Sandisk forecast revenue and earnings per share with a midpoint of $4.6 billion and $13, respectively, or around 1.5 times and three times current Street estimates.
Sandisk saw broad-based strength across customer segments, including AI infrastructure builders, cloud hyperscalers, original equipment manufacturers and system integrators. Its BiCS8 QLC storage product, known as Stargate, continues to move through qualification with two major hyperscalers and is expected to begin shipping within the next several quarters, Bank of America said.
However, the analysts cautioned that higher NAND prices could eventually weigh on unit volumes for PCs and smartphones.
Bank of America raised its price objective on Sandisk to $850 from $390, citing sharply higher profitability expectations. The firm lifted its fiscal 2026 revenue and earnings forecasts to $15.7 billion and $39.50 per share, respectively, from $10.9 billion and $16.21.
The analysts reiterated their buy rating, pointing to strong margins, eSSD share gains expected in calendar 2026, undervalued joint venture assets and the long-term potential for industry consolidation.