Can the 20% Surge Last?

Sandisk shares trade around $648 in overnight action after closing at $539.30, marking a gain of more than 20% following its fiscal Q2 earnings release. The sharp move followed results that exceeded expectations across revenue, margins, and guidance, placing the stock among the strongest post-earnings performers in the technology sector this quarter. Traders reacted quickly as the scale of the earnings beat reset near-term expectations.

Revenue Growth Accelerates Across All Segments

Sandisk reported second-quarter revenue of $3.03 billion, reflecting 31% sequential growth and a 61% increase from the prior year. Data center revenue reached $440 million, rising 64% quarter over quarter as hyperscalers expanded AI-related storage deployments. Edge revenue climbed to $1.68 billion, while consumer revenue advanced to $907 million, both showing strong sequential momentum. Each segment contributed to the top-line surge, signaling broad-based demand rather than reliance on a single end market.

Source: X

Margins and Cash Flow Surge Alongside Demand

Profitability improved sharply during the quarter. Non-GAAP gross margin expanded to 51.1%, up from 29.9% in the prior quarter, reflecting improved pricing, product mix, and operating leverage. Non-GAAP earnings per share reached $6.20, compared with $1.22 previously. Free cash flow totaled $843 million, representing a 27.9% margin. 

Cash and equivalents stood at $1.54 billion, while debt declined to $603 million, leaving Sandisk with a net cash position of $936 million.

Guidance Resets Expectations For Q3

Management issued an aggressive outlook for the third quarter. Sandisk expects revenue between $4.4 billion and $4.8 billion, well above prior market assumptions. The company guided for a non-GAAP gross margin of 65% to 67% and non-GAAP EPS between $12 and $14. 

These figures suggest continued operating leverage as supply tightens and demand from AI infrastructure remains elevated. Can the company meet that bar again? Markets now treat that question as central.

Supply Constraints and Strategic Partnerships

Despite strong demand, Sandisk acknowledged limits in its ability to fulfill all customer orders. The company continues to operate one of the world’s largest NAND flash manufacturing sites through its long-standing joint venture with Kioxia, which it recently extended through 2034. 

Sandisk will pay Kioxia $1.165 billion for manufacturing services to ensure long-term supply availability. Qualification of PCIe Gen 5 drives at multiple hyperscalers further strengthens its competitive position.

Source: X

Is It a Good Time To Buy? What Investors Are Watching

Following the overnight surge, valuation and sustainability dominate investor focus. Sandisk now trades near elevated multiples after one of its strongest quarters on record. Technical indicators point to stretched conditions, while supply constraints and heavy AI-linked capital investment remain key variables. Data from Barchart Jan 27th 2026 shows that, if you had invested $10,000 in SanDisk $SNDK on its IPO last year (after the spin-off), you’d have over $132,000 today.

Data from CoinCodex show that the price of Sandisk Corporation is forecasted to hit $ 734.53 by the end of 2026 (+36.20% compared to current rates), and $ 2,772.30 by the end of 2030 (+414.06%). At the same time, guidance implies earnings acceleration into the next quarter. The market now watches whether execution can match expectations as volatility rises and positioning resets after the sharp move.