Sandisk Corporation Q3 FY2026 Earnings Call

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Sandisk Corporation Q3 FY2026 Earnings Summary

Overall Performance: Delivered strong results with record metrics driven by data center demand, pricing strength, and new multiyear supply agreements. Revenue and margins significantly exceeded guidance and prior periods, reflecting a shift to higher-value mix and AI-related workloads.

Key Financial Highlights (Q3 FY2026 vs. Prior Periods)

  • Revenue: $5.95 billion (up 97% sequentially from Q2 FY2026; up 251% year-over-year from Q3 FY2025). Beat guidance range of $4.4–4.8 billion.
  • Bit Shipments: Flat year-over-year; down high-teens percent sequentially. Fiscal year-to-date growth of 18% (mid- to high-teens target).
  • Non-GAAP Gross Margin: 78.4% (up from 51.1% in Q2 FY2026). Beat guidance of 65–67%.
  • Non-GAAP Operating Expenses: $448 million (7.5% of revenue, down from 13.7% in Q2 FY2026). Within guidance of $450–470 million.
  • Non-GAAP Operating Margin: 70.9% (up from 37.5% in Q2 FY2026).
  • Non-GAAP EPS: $23.41 (up from $6.20 in Q2 FY2026). Beat guidance of $4.12–14.
  • Adjusted Free Cash Flow: $2.955 billion (49.7% margin). Cash position: $3.735 billion.
  • Capital Expenditures: $240 million (4% of revenue).

End Market Performance (Sequential Changes)

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Operator: Good afternoon, and welcome to Sandisk Corporation's Third Quarter Fiscal Year 2026 Earnings Conference Call. All participants will be in listen-only mode. To ask a question, please press star then 1 on your telephone keypad. 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, 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, our capital allocation priorities, 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 the written materials posted in the Investor Relations section of our website. With that, I will turn the call over to David. David V. Goeckeler: Thanks, Ivan. Good afternoon,

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