Key Highlights
- SanDisk (SNDK) shares reached a 52-week peak of $2,354.39 on June 22 before retreating, with year-to-date gains exceeding 700% in 2026.
- A sharp decline in South Korea’s Kospi index and questions surrounding AI memory spending sustainability contributed to the recent selloff.
- According to Morgan Stanley, SanDisk views AI as “fundamentally changing” the NAND landscape, fueled by inference workloads and expanding LLM context requirements.
- Third-quarter fiscal 2026 revenue jumped 251% year-over-year to $5.95 billion, crushing Wall Street’s $4.55 billion forecast.
- Fourth-quarter outlook projects revenue between $7.75B and $8.25B, with anticipated non-GAAP EPS ranging from $30 to $33.
SanDisk (SNDK) shares have emerged as a remarkable success story throughout 2026. Following a year-to-date surge exceeding 700%, the stock reached its 52-week zenith of $2,354.39 on June 22. Shortly after, the selloff began.
Shares tumbled substantially in tandem with other memory semiconductor stocks, pressured by an unprecedented crash in South Korea’s Kospi benchmark and mounting skepticism regarding the durability of AI-fueled memory expenditures. SNDK has declined approximately 13.6% in the recent downturn and is down roughly 5.75% across the past five sessions. At press time, the stock was trading around $1,963.60.
Despite the recent setback, shares maintain a 32.8% gain over the trailing 30-day period. This perspective is crucial ā the current decline represents the first significant challenge to the AI memory investment thesis since SanDisk’s separation from Western Digital in early 2025.
The Forces Behind the AI Memory Revolution
Morgan Stanley’s Joseph Moore noted that SanDisk sees AI as “fundamentally changing” the NAND marketplace. The primary catalyst is inference workload demand. With large language models requiring expanded key-value caches and broader context windows, DRAM capacity alone proves insufficient ā pushing NAND higher up the memory hierarchy to bridge the performance gap.
Cloud infrastructure is projected to become NAND’s dominant end market before year-end. SanDisk’s data center business already demonstrates this transformation, skyrocketing 233.4% sequentially to reach $1.47 billion during Q3 FY2026.
Third-quarter results, announced on April 30, exceeded all expectations. Revenue reached $5.95 billion, representing a 251% year-over-year increase and significantly surpassing the $4.55 billion analyst consensus. Non-GAAP EPS registered at $23.41 compared to the $14.36 estimate. Non-GAAP gross profit exploded 1,111.9% year-over-year to $4.7 billion. Additionally, the company eliminated its debt position, closing the quarter with $3.7 billion in cash reserves.
Shares advanced 3.04% on the earnings announcement date and gained an additional 8.25% during the subsequent trading session.
Looking Ahead
Executive leadership provided Q4 FY2026 revenue guidance of $7.75 billion to $8.25 billion, with non-GAAP EPS projected between $30 and $33. Wall Street analysts anticipate Q4 EPS of $31.81, representing a staggering 158,950% year-over-year increase.
QLC Stargate products ā currently undergoing hyperscaler qualification for more than a year ā are now anticipated to commence revenue-generating shipments in Q4, creating an additional growth avenue beyond existing TLC traction.
Notwithstanding the impressive rally, SanDisk commands a forward adjusted earnings multiple of 34.13x and a price-to-sales ratio of 17.17x, both exceeding sector norms. Its trailing P/E ratio of 64.5 compares unfavorably to the industry average of 44.5. The stock also trades approximately 12% above the consensus analyst price target of $1,863.06.
Among 21 analysts tracking the stock, 18 assign it a “Strong Buy” rating, one designates it as “Moderate Buy,” and two recommend “Hold.” Morgan Stanley upholds an “Overweight” stance with a $1,750 price objective. The highest Street target stands at $3,250.
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