A quarter well ahead of the prior outlook
Sandisk reported fiscal fourth-quarter revenue of $8.97 billion, a 51% increase from the preceding quarter and a 372% rise from the comparable period a year earlier. The result exceeded the company’s prior revenue outlook of $7.75 billion to $8.25 billion, extending a rapid recovery in the NAND flash-storage market.
GAAP net income reached $6.90 billion, or $43.97 per diluted share. On a non-GAAP basis, diluted earnings per share were $39.25. Gross margin was 84.6%, up 6.2 percentage points sequentially from 78.4% in the third quarter. Operating income rose to $7.04 billion.
The scale of the improvement underlines how substantially Sandisk’s earnings have become exposed to higher pricing and a richer mix of enterprise-oriented products. Revenue grew faster than operating expenses, allowing most of the incremental sales to translate into profit. Such operating leverage is characteristic of memory markets during periods of tight supply and elevated prices, but it can reverse when supply-demand conditions change.
| Metric | Fiscal Q4 2026 | Sequential change |
|---|---|---|
| Revenue | $8.97bn | +51% |
| Gross margin | 84.6% | +6.2 percentage points |
| GAAP net income | $6.90bn | +91% |
| GAAP diluted EPS | $43.97 | — |
| Non-GAAP diluted EPS | $39.25 | — |
Data-centre business becomes a central growth driver
The quarterly revenue mix demonstrates the increasing importance of larger customers and performance-focused storage applications. Data-centre revenue was $2.98 billion, more than double the third-quarter level. Edge revenue, which was Sandisk’s largest segment in the quarter, rose 48% sequentially to $5.43 billion. Consumer revenue declined 32% from the prior quarter to $556 million.
This mix shift matters because data-centre customers generally buy higher-capacity products and may value supply assurance, performance and technical collaboration more highly than the consumer market. It also means that results are becoming more closely tied to cloud and artificial-intelligence infrastructure investment, as well as to the purchasing patterns of a smaller group of large customers.
Sandisk said it signed five additional agreements under its New Business Model since April, including three with new customers, bringing the total to ten. The company has described this model as involving multi-year customer engagements supported by financial commitments. If those arrangements improve visibility into demand and capacity needs, they could reduce some of the volatility traditionally associated with spot-driven memory markets. Their effectiveness will depend on contract execution, customer demand and the competitive supply environment.
A transformed full fiscal year
For fiscal 2026, Sandisk recorded revenue of $20.25 billion, up 175% from fiscal 2025. GAAP net income was $11.43 billion, while GAAP diluted earnings per share were $73.76. The full-year gross margin rose to 71.5%, an increase of 41.4 percentage points from the previous year.
The comparison is particularly striking because fiscal 2025 included a much weaker pricing environment and a goodwill impairment that affected reported profitability. The fiscal 2026 result therefore reflects both a cyclical market upturn and Sandisk’s own move towards higher-value end markets.
For the full year, data-centre revenue reached $5.15 billion, up 437% year on year. Edge revenue was $12.16 billion, up 195%, while consumer revenue increased 29% to $2.94 billion. The figures illustrate that the recovery was broad, although the fastest expansion came from data-centre storage.
Cash returns and investment capacity
The company generated $7.08 billion of free cash flow in the fourth quarter. Sandisk repurchased $4.52 billion of shares during the period, and its board authorised an additional $14 billion for repurchases. The company said that $15.5 billion remained available under its authorisation after the change.
A large buyback can signal management confidence in the durability of cash generation, but it also raises the importance of capital-allocation discipline. NAND technology requires continued investment in product development and manufacturing partnerships. Sandisk must balance shareholder distributions against the spending required to sustain its technology position and meet rising data-centre demand.
Guidance keeps expectations high
For the first quarter of fiscal 2027, Sandisk forecast revenue between $10.30 billion and $10.80 billion, with non-GAAP diluted earnings per share of $44.00 to $46.00. At the midpoint, the outlook implies another material increase in revenue from the fiscal fourth quarter.
The forecast suggests management expects strong customer demand and favourable market conditions to continue into the new fiscal year. However, it also sets a demanding benchmark. Investors will be watching whether supply constraints, pricing discipline and the data-centre mix can support margins near the unusually high level reached in the fourth quarter.
Sandisk’s fiscal 2026 results establish data-centre storage as a major pillar alongside its established edge and consumer operations. The next test is whether the company can turn an exceptional memory-cycle upswing into more durable earnings power without becoming overly dependent on a limited number of high-value customers or on pricing conditions that can change quickly.
