SanDisk Q3 Revenue Surges 97% on $42 Billion Contract Win

SanDisk posted Q3 revenue of $5.95 billion, up 97% year-over-year, with GAAP net income hitting $3.65 billion—a 350% surge from last year.

I double-checked that growth rate. Gross margin jumped to 78.4%, up 27.5 percentage points from the same quarter last year. For every dollar in sales, they're keeping 78 cents as profit. CEO David Goeckeler was clear: this isn't about riding a cyclical wave. They've restructured the business model for stable, recurring revenue.

Here's what matters: SanDisk has locked in long-term supply agreements with 5 customers, 3 of which were signed in Q3. Those 3 contracts alone guarantee minimum revenue of $42 billion. Across all 5 agreements, there's $11 billion in financial backing. They've essentially locked down orders for the next several years.

Yet the stock dropped 6% after earnings. Despite a 3300% gain over the past year, the market apparently wanted more. SanDisk expects Q4 revenue between $7.75 billion and $8.25 billion, maintaining the momentum. Memory and SSD prices have been climbing for nearly a year now, with Samsung, SK Hynix, and Micron all benefiting.

Goeckeler sounded confident—customers are happy, they're happy, and he can't think of who's losing. Bold claim, but the numbers back it up. For PC builders and gamers, don't expect memory or SSD prices to drop anytime soon. This pricing cycle has legs.