On January 29, 2026, SanDisk Corporation (SNDK) reported a “blowout” second quarter that sent its stock surging more than 14% in extended trading. The results, which obliterated Wall Street’s expectations, were fueled by what CEO David Goeckeler described as a “step change in demand” for AI-driven storage.
While SanDisk operates as a primary brand under Western Digital (WDC), the market reaction was specifically tied to the explosive growth of the flash memory and NAND segments required for massive AI data centers.
1. The “Blowout” Q2 2026 Financials
SanDisk’s performance for the quarter ended December 31, 2025, showed nearly triple-digit beats in profitability compared to consensus estimates.
| Metric | Q2 2026 Actual | Analyst Estimate | Surprise |
| Revenue | $3.03 Billion | $2.69 Billion | ↑ 12.6% |
| Non-GAAP EPS | $6.20 | $3.54 | ↑ 75.1% |
| Gross Margin | 51.1% | 42.0% | ↑ 910 bps |
| Operating Income | $1.13 Billion | ~$0.3 Billion | ↑ 275% |
2. Segment Performance: The Data Center Engine
The primary catalyst for the stock’s 14%–17% after-hours rally was the unprecedented growth in enterprise-grade SSDs (Solid State Drives).
- Data Center Revenue: Surged 64% quarter-over-quarter to $440 million. Management noted that AI infrastructure builders and hyperscalers (like Microsoft and Amazon) are adopting high-capacity NVMe SSDs at a rate far exceeding supply.
- Edge Business: Revenue rose 21% to $1.68 billion, driven by premium smartphone UFS storage and high-end AI laptops requiring richer storage configurations.
- Consumer: Climbed 39% to $907 million, benefiting from a shift toward high-performance “Extreme Pro” portable SSDs during the holiday season.
3. Blockbuster Q3 Guidance
Investors were most impressed by SanDisk’s “explosive” forward outlook, which suggests the current AI-driven storage shortage will persist through the end of 2026.
- Revenue Guide: Projected between $4.4 billion and $4.8 billion, nearly 60% higher than the $2.77 billion analysts were expecting.
- Earnings Guide: Expected adjusted EPS of $12 to $14, essentially doubling the $5.11 consensus estimate.
- The “Stargate” Tailwind: The company confirmed that its BiCS8 QLC product (code-named Stargate) is nearing revenue shipments for major hyperscalers, which will likely push margins even higher in late 2026.
4. Strategic Context: A Structural Shift
During the earnings call, CEO David Goeckeler highlighted that the NAND industry has moved away from its traditional “boom-and-bust” cycle toward a model defined by multi-year commitments.
- Supply Certainty: SanDisk is now engaged in long-term supply agreements with top-tier customers to guarantee capacity for future AI training clusters.
- The 1,350% Rally: This earnings report caps off a historic year for SNDK, which has seen its stock price rise over 1,350% in the last 12 months, outperforming nearly every other player in the semiconductor space except for Nvidia.
Conclusion: The “NAND-AI” King of 2026
SanDisk has successfully transformed from a cyclical commodity supplier into a high-margin AI infrastructure essential. With gross margins now exceeding 51% and a massive order backlog stretching into 2027, the company is the primary beneficiary of the “storage crisis” sparked by the global AI arms race. For investors, the Q2 results confirm that the demand for AI doesn’t just stop at GPUs—it begins with the memory that stores the data.
