Sandisk Corporation

Sandisk reported first-quarter fiscal 2027 revenue of $11 billion, up 23% sequentially and 378% year over year, versus guidance of $10.3 billion to $10.8 billion. Non-GAAP gross margin was 85.1%, up from 84.6% in the prior quarter; non-GAAP operating margin was 80.4%; and non-GAAP EPS was $49.51, up from $39.25 in the prior quarter and $1.22 in the same quarter last year. Adjusted free cash flow was $5.7 billion, cash flow from operations was $6.4 billion, and gross capex was $378 million. For the second quarter, management guided to revenue of $12.2 billion to $12.6 billion, non-GAAP gross margin of 84.5% to 85.5%, and non-GAAP EPS of $55 to $57 on a pre-split basis, or $6.88 to $7.13 split-adjusted after the announced 8-for-1 stock split.

David V. Goeckeler said the quarter showed that Sandisk’s strategy is working, with technology leadership, customer partnerships and disciplined financial management driving results above guidance. He emphasized that AI is structurally increasing NAND demand, especially in data center inference, and said new business models are extending customer visibility beyond fiscal 2030. His tone was confident and upbeat, but he also stressed disciplined execution and not rushing capacity or partnership decisions.

Luis Visoso focused on the financial execution: revenue of $11 billion, gross margin of 85.1%, operating expenses of $513 million, and EPS of $49.51, all ahead of guidance. He highlighted strong cash generation, including $5.7 billion of adjusted free cash flow, $5 billion returned via buybacks, $5.1 billion in cash and no debt, and said gross capex was $378 million, with fiscal 2027 gross capex expected to rise to a mid-single-digit percentage of revenue. He also said 95% of NBMs are with investment-grade customers that generated about $130 billion in operating cash flow, and reiterated a disciplined approach to capital returns.

Analysts pressed on the pace and scale of NBMs, whether data center demand is pulling the mix more aggressively, and how much of the portfolio can be committed long term. Management said the NBM pipeline is very strong, more deals are likely over the next several months and quarters, and that about 50% of bits are under NBM for fiscal 2027 and about 2/3 for fiscal 2028, with that share likely rising. Questions also focused on pricing, HBF timing, and the role of SLC in AI architectures; management said pricing should improve modestly, HBF is on track for samples next calendar year, and SLC is seen as additive rather than cannibalistic as customers refine inference architectures.