Sandisk Raises the Bar on AI-Linked Storage Demand
Sandisk (SNDK) issued a fiscal third-quarter outlook that topped Wall Street expectations, pointing to a sharp improvement in both sales and profitability as demand for data storage accelerates alongside the AI buildout. For U.S. investors watching the broader AI and semiconductors trade, the results highlight that the infrastructure behind AI is not only about compute chips—storage is a key bottleneck when data must be accessed quickly and at scale.
The company said it expects fiscal Q3 revenue with a midpoint of $4.6 billion and adjusted profit with a midpoint of $14 per share. That compares with consensus estimates of $2.77 billion in revenue and $4.37 in adjusted profit per share.
- Fiscal Q3 guidance came in well above consensus on both revenue and adjusted EPS.
- Management tied the outlook to tight flash supply conditions and sustained customer spending.
- The demand driver discussed was AI data centers running more inference workloads.
Why Flash Is Showing Up in the AI Narrative
While much of the market discussion around AI infrastructure has centered on a shortage in DRAM, Sandisk is positioning flash memory as another area seeing heightened pull from AI deployments. Flash is the foundation for solid-state drives that store large datasets used inside AI data centers.
The company described a buildout dynamic where large AI players are expanding data centers geared toward “inference,” meaning AI models responding to user requests. That workflow requires moving stored data into computing chips efficiently, which can increase the pressure on storage capacity and availability.
- DRAM is often discussed as the “closer to the processor” memory layer, but flash underpins high-capacity storage.
- Inference workloads can require fast access to stored data to keep compute resources utilized.
- Sandisk indicated customers are prioritizing secured supply in a tight market.
Quarterly Results Also Beat Expectations
Alongside the forward outlook, Sandisk posted fiscal second-quarter results that also exceeded estimates. The company reported $3.3 billion in sales and adjusted profit of $6.20 per share for the quarter, versus estimates of $2.64 billion and $3.33 per share.
For U.S. market positioning, that combination—an upside quarter plus a sharply higher guide—can matter because it may influence sentiment across storage, memory, and the broader AI supply chain that investors often treat as part of the same theme inside major U.S. benchmarks like the Nasdaq.
- Fiscal Q2 sales topped estimates.
- Adjusted EPS also exceeded expectations for the quarter.
- The company’s messaging emphasized demand strength rather than a one-time factor.
Supply Visibility: Agreement Extended Through 2034
A second major update for investors was on supply continuity. Sandisk secures flash chip supply through a joint venture with Kioxia in Japan, and the companies said they extended their supply agreement through the end of 2034, from a prior expiration at the end of 2029.
In practical terms, longer-duration supply arrangements can be a meaningful signal in memory markets that can swing between tightness and oversupply. Investors will likely focus next on whether Sandisk provides additional detail in future updates about capacity additions and how that interacts with pricing and product mix, especially if AI-related demand remains elevated.
WSA Take
Sandisk’s upside guidance and results reinforce that the AI buildout is pulling on more than just compute—storage is part of the critical path when inference workloads need rapid data access. For investors, the key near-term impact is how this read-through influences sentiment across the broader AI and semiconductor complex that can move with the Nasdaq. The extension of the Kioxia supply agreement through 2034 adds visibility on sourcing, which can matter in a tight market where customers prioritize continuity. The next investor-relevant checkpoints are follow-on commentary about supply, capacity investments, and whether demand remains strong enough to keep conditions tight.
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