Seagate Technology (NASDAQ:STX | STX Price Prediction) reported its fiscal second-quarter 2026 earnings yesterday, and the results beat Wall Street expectations on both revenue and earnings per share. The company brought in $2.83 billion in revenue, topping the consensus estimate of around $2.75 billion. On the bottom line, non-GAAP earnings came in at $3.11 per share, well above the expected $2.83. This strong showing was largely driven by robust demand for high-capacity storage solutions needed for artificial intelligence (AI) applications, such as data centers handling massive AI workloads.
The positive news from Seagate sent shares of SanDisk (NASDAQ:SNDK) higher, with the stock rising nearly 6% in morning trading today. Investors are now looking ahead to SanDisk’s own second-quarter earnings report, set for release tomorrow. Since spinning off from Western Digital (NASDAQ:WDC) last February, SanDisk has seen its stock soar dramatically — up about 1,725% from its post-separation lows — sparking excitement about whether it will deliver another strong beat.
What’s Fueling SanDisk’s Stock Surge?
SanDisk’s impressive run reflects several key trends in the market. Its NAND flash memory products are in high demand because of the explosion in AI infrastructure. Data centers powering AI need fast, reliable storage for handling huge amounts of data, and SanDisk’s flash-based solutions fit the bill perfectly. This surge has led to a global shortage of memory products, giving companies like SanDisk more pricing power and the ability to charge higher prices.
The imbalance between supply and demand continues to support growth. With limited new supply coming online quickly and shipments staying strong, pricing remains favorable, which helps boost revenue and potentially widen profit margins. In its most recent reported quarter, SanDisk posted revenue of $2.31 billion, a solid 22.6% increase year over year. Earnings for that period hit $1.22 per share, far exceeding the $0.89 consensus, showing how well the company is capitalizing on the memory crunch.
Broader industry trends are helping, too. The AI boom requires efficient, high-performance data storage, and SanDisk’s flash memory portfolio is well-positioned to benefit from investments by big cloud providers and hyperscalers in data centers and edge computing.
The company has consistently beaten estimates in its recent quarters as a standalone public company. Institutional investors have taken notice, with firms such as Wealth Enhancement Advisory Services purchasing over 30,000 shares.
All of these factors have combined to fuel massive gains, including a roughly 1,085% rise over the past six months, in line with other memory and storage stocks riding the same AI wave.
What Analysts Anticipate from SanDisk
Wall Street is optimistic heading into tomorrow’s earnings. SanDisk has guided for revenue between $2.55 billion and $2.65 billion, with gross margins expected in the 41% to 43% range and non-GAAP operating expenses around $450 million. The company also projects earnings of $3.00 to $3.40 per share.
Analyst consensus is a bit higher, calling for about $2.68 billion in revenue and $3.31 per share in earnings. This reflects expectations that AI-driven demand for NAND flash will keep pushing sales higher. Looking further out, full fiscal 2026 projections show revenue climbing 42% to around $10.45 billion, with earnings surging 552% year over year. SanDisk is expected to more than double earnings again in fiscal 2027.
SanDisk has a strong track record as a public company, beating estimates in each of its first three quarters since the spinoff. In the prior quarter, it topped guidance with $2.3 billion in revenue and roughly $1.20 per share in earnings. Analysts point to the stock’s forward price-to-earnings ratio of under 16x as reasonable given the rapid growth outlook. Still, if results come in below expectations, valuation questions could surface given the stock’s sharp run-up.
Key Takeaway
Even if SanDisk doesn’t crush tomorrow’s earnings report, it appears set to show continued strong performance fueled by high demand for its storage solutions. The ongoing needs of AI infrastructure are driving requirements for NAND memory, supporting both revenue growth and healthier margins. I still expect a significant beat, which makes SanDisk’s stock an attractive option for growth investors interested in the expanding AI data storage sector.
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