TLDR
- Sandisk (SNDK) stock was down 4.5% to $1,270.01 in premarket trading Friday, after closing Thursday down 5%.
- Fiscal Q1 adjusted EPS of $49.51 and revenue of $11.03 billion both beat Wall Street estimates.
- The board approved an 8-for-1 stock split, with split-adjusted trading set to begin Nov. 30.
- Data center revenue jumped 1,682% to $4.8 billion, but Edge and Consumer revenue missed expectations.
- BofA cut its price target to $2,000 from $2,500 and kept a Buy rating.
Sandisk (SNDK) stock was trading at $1,270.01 in premarket action Friday, down 4.5%. It closed Thursday’s regular session down 5.3%.
That came after the company beat Wall Street on both revenue and profit. Investors, it seems, wanted more.
Adjusted earnings for the fiscal first quarter came in at $49.51 a share. Analysts had expected $46.67.
Revenue hit $11.03 billion, up 378% from a year ago. The Street was looking for $10.7 billion.
Adjusted gross margin was 85.1%, compared with 29.9% a year earlier. Analysts had forecast 84%.
Adjusted free cash flow reached $5.7 billion. Revenue also rose 23% from the prior quarter.
Sandisk’s board approved an 8-for-1 stock split. Additional stock is expected to be distributed Nov. 19, and split-adjusted trading begins Nov. 30.
Data center soars, Edge and Consumer lag
Data center revenue jumped 1,682% from a year ago to $4.8 billion. Analysts had projected $3.98 billion.
Edge revenue rose 320% to $5.8 billion, but that missed the $6.07 billion estimate. The line covers flash memory for phones, PCs, cars, tablets and physical AI.
Consumer revenue fell 39% to $397 million. Analysts had expected $590 million.
So the headline beat came with a couple of soft spots. The market clearly noticed.
Sandisk pointed to technology leadership, consumer partnerships and disciplined financial management. It also expects AI-driven NAND demand to last beyond fiscal 2030.
Guidance and analyst reaction
For the fiscal second quarter ending in December, Sandisk expects revenue of $12.2 billion to $12.6 billion. It guided adjusted earnings of $55.00 to $57.00 a share.
Analysts were looking for $12.31 billion and $53.60 a share. The gross margin outlook of 84.4% to 85.4% also tops the 84% they expected.
BofA Securities cut its price target to $2,000 from $2,500 and kept a Buy rating. The firm said it lowered its target multiple on late-cycle valuation concerns.
BofA said about 60% of the quarterly revenue growth came from volume and 40% from pricing. It still cited AI inference as making NAND more indispensable.
Rivals fell in premarket trading Friday too. Micron dropped 3.8%, Western Digital fell 5.8% and Seagate slid 5.1%.
Sandisk stock has gained 460% through Thursday’s close and 579% over the past 12 months. Split-adjusted trading starts Nov. 30.
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