Sandisk (SNDK) Q3 2026 earnings summary

Executive summary

• Achieved record Q3 2026 results with revenue of $5.95B, up 97% sequentially and 251% year-over-year, driven by strong demand in datacenter and edge markets, new multi-year supply agreements, and favorable pricing trends.

• Signed multiple multi-year supply partnerships, securing over a third of bits for FY27, with $42B in minimum contractual revenue and $11B in financial guarantees.

• Completed spin-off from Western Digital in February 2025, now operating as an independent public company.

• Announced a $6B share buyback program after achieving a net cash position by repaying all outstanding debt.

• Benefited from higher average selling prices per gigabyte and increased exabytes sold, especially in datacenter and edge segments.

Financial highlights

• Q3 revenue reached $5.95B, up 97% sequentially and 251% year-over-year, exceeding guidance.

• Non-GAAP gross margin was 78.4%, up from 51.1% prior quarter; GAAP gross margin also 78.4%.

• Non-GAAP operating margin rose to 70.9%; GAAP operating margin was 69.1%.

• Non-GAAP EPS was $23.41, GAAP diluted EPS was $23.03; net income for Q3 was $3.62B.

• Adjusted free cash flow was $2.96B–$2.99B; cash and equivalents at quarter-end were $3.74B.

Outlook and guidance

• Q4 2026 revenue forecasted at $7.75B–$8.25B, with non-GAAP gross margin of 79%–81%.

• Non-GAAP EPS expected between $30 and $33, assuming 158M fully diluted shares.

• Continued investment in innovation and R&D, with non-GAAP operating expenses guided at $480M–$500M.

• Management expects favorable pricing and demand trends to persist through calendar 2026 and beyond, driven by AI infrastructure growth.