Sandisk Corporation Q2 FY2026 Earnings Call

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Sandisk Corporation Q2 FY2026 Earnings Summary

Overview: Revenue reached $3.025 billion (up 31% sequentially from Q1 FY2026 and 61% year-over-year), driven by AI demand, higher pricing, and strong performance across segments. Non-GAAP EPS was $6.20 (up from $1.22 in Q1). Non-GAAP gross margin expanded to 51.1% (from 29.9% in Q1), exceeding guidance of 41-43% due to pricing strength. The company emphasized structural NAND market shifts toward multiyear agreements and reduced cyclicality.

Key Financial Highlights vs. Prior Periods

  • Revenue: $3.025B (+31% QoQ from Q1 FY2026; +61% YoY). Beat guidance of $2.55-2.65B.
  • Non-GAAP Gross Margin: 51.1% (+21.2 pp QoQ from 29.9% in Q1). Ex-startup costs: 51.9%. Guidance beat of 41-43%.
  • Non-GAAP Operating Margin: 37.5% (up from 10.6% in Q1).
  • Non-GAAP EPS: $6.20 (up from $1.22 in Q1). Beat guidance of $3.00-3.40.
  • Free Cash Flow: $843M (27.9% margin); net cash position $936M after paying down $750M debt.
  • Bits Sold: +22% YoY; low single-digit % QoQ.

End-Market Revenue Performance (Q2 FY2026)

  • Data Center: $440M (+64% QoQ). PCIe Gen5 TLC drives qualified at second hyperscaler; BICS8 QLC (Stargate) advancing.

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Operator: Good day, and welcome to the Sandisk Corporation Second Quarter Fiscal 2026 Earnings Call. All participants will be in a listen-only mode. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then 1 on a touch-tone phone. To withdraw your question, please press star then 2. Please note this event is being recorded. I would now like to turn the conference over to Ivan Donaldson, Head 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 references 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. Afternoon

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