SanDisk Made Money... Can It Be? (SNDK)

Flash memory giant SanDisk Corp. (NASDAQ: SNDK) posted a surprise profit.  Earnings were $52.5 million, or $0.23 EPS, but its non-GAAP earnings were $0.36 EPS.  That compares to a loss of $73.75 million a year ago.  Revenues came in down almost 10% at $730.5 million from $816 million a year ago.  Thomson Reuters had the non-GAAP consensus as a loss of -$0.16 EPS and $709.69 million in revenues.  It is almost hard to believe after so much weakness has become the norm, but the company noted increased pricing, higher royalty revenue, and strong execution.

Licensing and royalty revenue grew by almost 68% sequentially to $120 million.  Year-over-year that figure is still down by 7%.  The company has more market certainty on its renewed patent cross licensing pact with Samsung for another seven years.  Another note from management is that the company is “cautiously optimistic about the second half of 2009.”

Without any formal guidance until after the conference call we are considering this an unfinished story.  Either way, earnings have been bad for so long at SanDisk that this almost seems like a dream.  Shares closed up over 4% at $18.99 today, and the after-hours trading has shares around $19.00.  The 52-week range is $5.07 to $23.50.

UPDATED AT 5:24 PM EST: In the conference call, SanDisk has guided the coming quarter to $725 million to $775 million in revenues, with $110 million to $115 million in licensing and royalty revenues.  Thomson Reuters has estimates pegged at $776 million, so that mid-point is far under the real consensus estimate.  Shares are now down 6% at $17.75 in the after-hours session.

JON C. OGG