SanDisk (SNDK) stock returned 1,493% in the twelve months to October 1, 2026. A $10,000 stake at the start was worth about $159,000 at the end. The business shift behind this run was price: Customers paid significantly more for SanDisk’s NAND flash memory. Yet in the fourth quarter of fiscal 2025, the latest results filed before the race, SanDisk barely made an operating profit. What could you have noticed before the race that indicated an increase in prices?
SanDisk’s supply reduction points to higher prices
You might have noticed that SanDisk was reducing its own supply. On May 7, 2025, management stated that SanDisk had “taken steps to reduce supply to match demand.” It was almost five months before the start of the race.
A reduction in supply is important because memory prices follow the balance between supply and demand. Higher prices are important because they generate profits almost directly. As an example, a chipmaker selling the same chips at double the price doubles its revenue while its costs barely change.
You could have followed this logic in May 2025, but only as a gamble. SanDisk had just reported its third fiscal quarter 2025. During this quarter, revenue fell 0.6% from the previous year and SanDisk recorded an operating loss. Media coverage on June 2, 2025 still described oversupply putting pressure on prices. He also noted that SSDs, SanDisk’s flash storage products, had not yet won over professional customers.
The next thing to notice happened on June 18, 2025. Bank of America started covering SanDisk with a buy rating. Its analysts argued that the price of memory improved as the balance between supply and demand changed.
SanDisk’s own results for the fourth quarter of fiscal 2025, filed on August 21, 2025, showed only a slight recovery. Its operating margin, the portion of turnover retained in operating income, was 2.7% after the previous loss. So you could have read the direction before the race. You couldn’t have predicted how high prices would go.
How far has SanDisk worked and what’s changed?
SanDisk stock returned 1,493% over twelve months, compared to 16.0% for the S&P 500. Peer Micron Technology returned 556.9% over the same window, so this increase is not just SanDisk’s.
SanDisk’s prices have changed much more than its volumes. Revenue for fiscal 2026 was approximately $20.2 billion, up 175% from the previous year. SanDisk’s shipped memory only grew by about 15%, so most of that growth came from price.
Profits grew even faster. SanDisk’s operating margin over the trailing twelve months was 62%. In the previous twelve months it was 6.9%.
Does SanDisk still get higher prices today?
Yes, but more slowly than before, following management’s call on August 5, 2026. Management said then that higher prices produced about two-thirds of the revenue growth between the third and fourth quarters of fiscal 2026. For the first quarter of fiscal 2027, it said it expected only modest price increases.
Management said customers want more memory than SanDisk can provide. Management also called data centers the fastest growing end market. They occupied 38% of SanDisk’s memory at the end of fiscal 2026, up from about 12% a year earlier.
Higher prices show up in SanDisk’s adjusted gross margin, the share of revenue remaining after the cost of manufacturing the chips. SanDisk reported 84.6% for the fourth quarter of fiscal 2026. Management’s guidance for the first quarter of fiscal 2027 was between 83% and 85%.
The risk is that SanDisk’s price increases fade. Financial results for the first quarter of 2027 will show whether this is the case. An adjusted gross margin above 85% would suggest that prices have increased faster than management expected. A margin below 83% would be an early warning that price increases are fading.
Does this mean you should take action on the SNDK?
Our goal is to inform you with unique data so that you make the right investment decisions. That said, betting on a single stock is always risky, no matter which direction you choose.
There is a smarter approach. Since its inception, the Trefis High Quality (HQ) portfolio has returned 105%, outperforming the benchmark that combines the three major indexes: the S&P 500, the S&P Mid-cap, and the Russell 2000. And it has done so without taking on the concentrated risk that comes with do-it-yourself stock picking. If this is how you want to invest, the HQ Portfolio is the place to start.
Gn bussni
