SanDisk Earnings Preview: NAND Price Hikes and Data Center Demand in Focus With Wall Street High Target of $3,000

A major driver of SanDisk's recent performance growth has come from rising NAND flash memory prices. As demand for high-capacity storage from AI data centers increases, enterprise SSDs have gradually become an important source of growth for the memory industry. Compared with traditional consumer electronics storage demand, data center clients have higher requirements for capacity, performance, and supply stability, which has also created favorable conditions for SanDisk to secure long-term supply agreements.

SanDisk's revenue reached $8.97 billion in the fourth quarter of fiscal 2026, up significantly year-over-year. Management previously noted that price increases were a key factor driving revenue growth, accounting for roughly two-thirds of the sequential revenue gain for the quarter. Moving into the first quarter of fiscal 2027, the company expects revenue to rise further to between $10.3 billion and $10.8 billion, with management also expecting product prices to continue to rise modestly.

However, the pace of price increases may gradually slow down. In the preceding quarters, SanDisk recorded consecutive quarters of substantial revenue growth, and the market had already priced in expectations of an upswing in the memory industry. As the revenue base continues to rise, whether subsequent growth can be sustained will depend more on the combined drive of pricing, shipment volumes, and product mix, rather than relying solely on price increases.

AI model training and inference require vast amounts of data storage. As a result, demand for enterprise SSDs in terms of data access speed, power consumption, and capacity has increased, creating new growth opportunities for NAND flash suppliers.

SanDisk's data center revenue expanded rapidly in fiscal year 2026, coming in at approximately $440 million in the second quarter, rising to $1.47 billion in the third quarter, and reaching $2.98 billion in the fourth quarter, accounting for about one-third of total company revenue. For full-year fiscal 2026, revenue for this business surged 437% year-over-year, showing that data centers are gradually becoming an indispensable part of SanDisk's business portfolio.

The upcoming earnings report will provide the market with an opportunity to evaluate the latest performance of this business. Investors should focus on whether data center revenue continues to grow, whether enterprise SSD demand remains strong, and whether the segment's share of total company revenue increases further. If data center revenue continues to expand, the extent to which SanDisk benefits from AI infrastructure demand will become even clearer.

Long-term supply agreements may also be an important factor affecting future revenue. SanDisk management previously indicated that the company had signed several multi-year commercial agreements, which help improve future demand visibility. However, the actual value of these agreements still depends on customer procurement execution, supply delivery capacity, and contract terms. The market will need to judge from subsequent earnings reports whether these agreements can consistently translate into revenue and profit growth.

SanDisk's stock price has significantly outperformed the S&P 500 Index over the past year, but its pullback from highs shows that the market remains sensitive to the memory cycle. Previously, even when the company reported better-than-expected results, its stock price dropped because subsequent guidance fell short of heightened buy-side expectations.

As of the latest statistics, 17 Wall Street analysts tracked by TipRanks give SanDisk a consensus rating of "Strong Buy," with a 12-month average price target of $2,205.59, a high estimate of $3,000, and a low estimate of $1,550.

Source: TipRanks

The company also has $15.5 billion in remaining share repurchase authorization, and strong cash flow together with the buyback plan could provide some support for the stock price. However, as market expectations for this earnings report continue to rise, the challenge facing SanDisk is also increasing.

This content was translated using AI and reviewed for clarity. It is for informational purposes only.