SanDisk Stock Rockets as AI Memory Boom

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•  21 Dec 2025
 

•   SNDK  
   
  -1.73%

$SNDK has gone from a quiet spin-off story to one of the most talked-about stocks on Wall Street. Since returning to public markets in February at around $36, SanDisk shares have climbed to roughly $238, a move of more than 500%. For traders and investors chasing exposure to the artificial intelligence infrastructure boom, the stock has become hard to ignore. At the same time, the speed of the rally is forcing a more uncomfortable question into the open: how much of the future is already priced in?

SanDisk is not a newcomer. It traded on Wall Street from 1995 until 2016, when it was acquired by Western Digital. The recent separation brought it back as a standalone company, but into a very different market environment. Today, demand for NAND flash memory is being driven by AI workloads, cloud expansion, and massive investment in data centers. Unlike past cycles, supply remains relatively tight after years of reduced capital spending across the memory industry. This imbalance between rising demand and limited supply has supported higher prices, improving margins for manufacturers with strong enterprise exposure like SNDK.

What makes the current cycle different for SNDK is timing. The company returned to the market as a standalone business after separating from Western Digital, reentering Wall Street during one of the strongest infrastructure investment waves in decades. Unlike earlier memory upcycles driven by consumer electronics, this one is powered by long-term spending on AI, cloud services, and hyperscale data centers. That shift has changed how investors think about durability and earnings visibility.

Recent results have reinforced confidence. In its latest quarter, SanDisk reported revenue of $2.31 billion, up 23% year over year, signaling accelerating business momentum. Non-GAAP earnings jumped to $1.22 per share, compared with just $0.29 in the previous quarter. The improvement reflected higher sales volumes, better pricing, and a growing contribution from advanced products aimed at enterprise and data center customers. Free cash flow reached $448 million, nearly 20% of revenue, showing that profitability is catching up with growth.

Analysts see this momentum extending beyond the near term. Benchmark Equity Research expects strong industry conditions to last through at least 2026 and raised its earnings and revenue forecasts accordingly. The firm projects adjusted earnings of about $13 per share in 2026 and roughly $20 per share in 2027 as revenues continue to scale. Citi is even more bullish, suggesting earnings could approach $26 per share in 2027, driven largely by growth in enterprise SSDs used in data centers supporting AI workloads.

Technology is a critical part of that outlook. SanDisk transition to its BICS8 process is expected to improve performance, density, and cost efficiency, strengthening its competitive position in the NAND market. Management plans for BICS8 to become the dominant production technology by the end of fiscal 2026. While the transition requires heavy capital investment and precise execution, successful adoption could help protect margins in a highly competitive environment.

Another major catalyst was SanDisk inclusion in the S&P 500. Joining the index increased automatic demand from ETFs and institutional funds that track the benchmark, boosting liquidity and elevating the profile among long-term investors. For many market participants, this move confirmed SanDisk return as a core player in the U.S. technology sector rather than a speculative spin-off trade.

Still, valuation remains the main concern. After its rapid ascent, SNDK now trades at a price-to-sales ratio of roughly 4.5, well above the broader technology sector average. Such a valuation assumes continued strong revenue growth and meaningful margin expansion over the next several years. It also means expectations are high. Any slowdown in AI infrastructure spending, renewed pricing pressure in NAND, or execution issues around new technology could lead to sharp volatility.

This tension is familiar to experienced traders. Momentum remains powerful, supported by strong fundamentals and favorable industry trends, but the stock is no longer cheap by traditional metrics. For short-term participants, price action and sentiment around AI infrastructure will matter most. For long-term investors, the focus shifts to whether SanDisk can consistently convert AI-driven demand into sustainable earnings growth.

SanDisk story sits at the intersection of two dominant market forces: the massive buildout of artificial intelligence infrastructure and the constant risk of cyclical swings in the memory industry. The extraordinary run reflects confidence that this cycle is different, but the real test will be execution over the next several years. For those watching SanDisk stock rockets as AI memory boom traders flock to SNDK, the next phase may be less about speed and more about proving that optimism can turn into durable value.

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