Sandisk Corporation Q1 FY2026 Earnings Call

· Earnings call transcript and AI-powered summary

Sandisk Q1 Fiscal 2026 Earnings Summary

Overall Performance: Sandisk reported strong results driven by robust NAND demand exceeding supply across all markets. Revenue reached $2.308 billion (up 21% sequentially from ~$1.91B prior quarter and 23% year-over-year). Non-GAAP EPS was $1.22 (up significantly from $0.29 in Q4 FY2025; guidance was $0.70–$0.90). Adjusted free cash flow totaled $448 million (19.4% margin), achieving a net cash position of $91 million—six months ahead of the February Investor Day target.

Key Financial Metrics & Comparisons

  • Non-GAAP Gross Margin: 29.9% (up 350 basis points QoQ from prior quarter; exceeded guidance of 28.5–29.5%). Excluding $61M startup costs and $11M underutilization, margin was 33.1%.
  • Bits Shipped: Up mid-teens sequentially; pricing up mid-single digits (strengthened during quarter).
  • Operating Expenses: $446 million (above guidance of $415–430M due to higher variable compensation from revenue beat).
  • Balance Sheet: $1.442B cash; $1.351B gross debt. Paid down additional $500M on TLB; inventory days reduced from 135 to 115.
  • CapEx: Gross capital expenditures $387M (16.8% of revenue); focused on BiCS8 transition.

Segment Revenue Performance

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Operator: Good day, and welcome to the Sandisk First Quarter Fiscal 2026 Earnings Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Ivan Donaldson, Vice President of Investor Relations. Please go ahead. Ivan Donaldson: Before we begin, please note that today's discussion will contain forward-looking statements based on management's current assumptions and expectations, which are subject to various risks and uncertainties. These forward-looking statements include expectations for our technology and product portfolio, our business plans and performance, market trends and opportunities and our future financial results. We assume no obligation to update these statements. Please refer to our annual report on Form 10-K and our other filings with the SEC for more information on the risks and uncertainties that could cause actual results to differ materially from expectations. We will also make reference to non-GAAP financial measures today. Reconciliations between the non-GAAP and comparable GAAP financial measures are included in written materials posted in the Investor Relations section of our website. With that, I'll turn the call over to David. David V. Goeckeler: Thanks, Ivan. Good afternoon and thank you for joining Sandisk's First Quarter Fiscal year 2026 Earnings Call. Sandisk delivered a strong quarter with revenue of $2.3 billion, up sequentially 21% and non-GAAP earnings per share of $1.22. W

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