SanDisk SNDK stock surged on Thursday after the memory chipmaker unveiled ambitious long-term financial targets and sought to reassure investors that demand for memory used in artificial intelligence infrastructure will remain strong through the end of the decade.
Shares climbed around 15% after the company’s 2026 Investor Day, extending recent gains and making SanDisk one of the best-performing stocks in the S&P 500.
The rally also lifted other memory and storage companies, with Micron Technology and Western Digital posting strong gains.
The upbeat outlook comes as investors have increasingly questioned whether the current memory boom can withstand the industry’s traditionally cyclical nature.
SanDisk’s management argued that multi-year customer agreements and AI-driven demand should help support growth and profitability for years to come.
Long-term growth targets lift investor confidence
At its Investor Day, SanDisk projected annual revenue growth in the mid-to-high teens between fiscal 2028 and fiscal 2030.
The company also forecast adjusted gross margins of roughly 80% during that period, alongside adjusted free cash flow margins of about 50%.
Chief Financial Officer Luis Visoso said SanDisk plans to return all excess cash to shareholders “after investing in the business.”
The company also expects profitability to remain elevated despite concerns that increased memory supply could pressure pricing.
Adjusted gross margins reached 84.6% last quarter, compared with 26.4% a year earlier, benefiting from tight supply conditions in AI-related memory markets.
Rather than relying on short-term demand cycles, SanDisk said it is increasingly securing multi-year business model agreements with customers.
Those agreements cover about half of its memory capacity in fiscal 2027 and roughly two-thirds in fiscal 2028.
Visoso attributed management’s confidence to those long-term customer relationships, saying, “Our confidence in the sustainability of the model comes from our multi-year NBMs that are based on intimate relationships with our customers and grounded in innovation and collaboration.”
AI demand underpins memory strategy
SanDisk believes artificial intelligence will continue creating new sources of demand beyond conventional storage applications.
The company highlighted its latest NAND flash technologies, including BiCS9 QLC and BiCS10 QLC. According to SanDisk, BiCS10 can store 60% more bits within the same physical space than the previous generation.
It is also developing High Bandwidth Flash (HBF), a technology designed for AI inference workloads.
The product aims to help data centers process the growing volumes of information required as AI models generate responses.
Management estimates the enterprise data center flash market could expand to 1.2 zettabytes by 2030 as AI adoption accelerates, reinforcing its long-term outlook for memory demand.
Analysts point to stronger business visibility
The company’s increased use of long-term customer agreements also drew positive commentary from Wall Street.
Evercore ISI analyst Amit Daryanani said SanDisk “expects the agreements to generate highly attractive returns even at floor pricing,” suggesting the contracts could provide earnings resilience even if memory prices weaken.
While concerns about the cyclical nature of the memory industry remain, SanDisk’s latest projections indicate management expects AI-driven demand, disciplined supply, and long-term customer commitments to support sustained revenue growth and high profitability through the rest of the decade.
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