SanDisk (SNDK) Q4 FY26 — A Record Print, a Doubled Buyback, and a Stock That Sold It

The setup

SanDisk is the flash-memory business Western Digital spun out as a standalone company in February 2025 — a pure-play NAND and SSD maker with no HDD ballast, which makes it one of the most direct large-cap ways to own the NAND cycle in the U.S. market. The structural fact that shapes every print: SanDisk does not run its wafer fabs alone. It manufactures through a 20-plus-year joint venture with Kioxia at the Yokkaichi and Kitakami plants in Japan — the same fabs Kioxia described on Tuesday. When you read SanDisk's gross margin, you are reading one company's share of a wafer stream whose other half just printed a ~80% gross margin two days earlier. Two P&Ls, one set of cleanrooms.

The backdrop is the cleanest memory upcycle since 2017–18: AI datacenter buildout is absorbing high-density enterprise SSD and NAND capacity, the leading suppliers have tilted output toward AI and enterprise parts, and supply has tightened across the board. Into the print the stock had already run more than 500% year-to-date (with a sharp ~47% pullback in July), so the bar wasn't "is the quarter good" — it was "is it good enough to justify a name that had already priced the cycle." The answer, on the tape, was no — even though on the fundamentals it was an unambiguous blowout.

The numbers

Records on every headline line. Revenue of $8.965 billion rose 372% year-on-year and ~51% sequentially (off roughly $5.9B in fiscal Q3), beating estimates. Non-GAAP gross margin reached 84.6% — a figure that only prints when a doubled NAND price deck runs through a fab's largely fixed cost base. GAAP diluted EPS was $43.97; non-GAAP diluted EPS $39.25 (about 14% above the Street), on GAAP net income of $6.90 billion, up ~91% sequentially. The Cloud/datacenter segment did the heavy lifting: datacenter revenue of ~$2.98 billion roughly doubled year-on-year and reached 33.2% of total sales, as SanDisk began recognizing revenue on its QLC-based Stargate enterprise-storage platform.

The full year matched the trajectory: FY2026 revenue of $20.25 billion (+175% YoY), GAAP diluted EPS of $73.76 (non-GAAP $70.88), and GAAP net income of $11.43 billion. And the forward line kept climbing — for fiscal Q1 2027 SanDisk guided revenue of $10.3–10.8 billion (midpoint $10.55B, ~+18% QoQ), a non-GAAP gross margin of 83.0–85.0%, and non-GAAP diluted EPS of $44–46. Alongside it the board authorized an additional $14 billion of buyback, lifting total remaining authorization to ~$15.5 billion — a large fraction of the company's own market value earmarked for repurchase.

So why did the stock fall ~4–8%? Because none of this was a surprise to a name up 500%+ on the year. The beat cleared the fundamentals; it did not clear the expectations already embedded in a stock that had quadrupled. This is the same tape pattern as AMD and SK hynix this cycle — a genuine record that sells off because the bar, not the business, was the binding constraint.