Sandisk's stock is flying higher. Here are the new targets that are exciting Wall Street.

By Britney Nguyen

The memory-chip company just offered revenue-growth forecasts stretching to the end of the decade, and Sandisk expects to maintain its high profitability as the years go on

Sandisk's stock soared Thursday following new financial forecasts.

Sandisk is riding a major wave of memory demand at the moment, and management just offered Wall Street a road map for growth stretching through the rest of the decade.

Shares of the memory-chip company were surging on Thursday after new financial targets were revealed at Sandisk's (SNDK) investor day. The stock rose 13.7% on Thursday, extending recent gains that bring its four-session increase to 25.8%.

Other memory and storage stocks gained as well, including Micron Technology (MU), up 4.2%, and Western Digital (WDC), up 7.3%.

Among the well-received targets from Thursday's event: The NAND flash memory maker expects its revenue to grow at a mid- to high-teens rate between fiscal 2028 and 2030. The company also expects to see growth in bits, referring to an increase in memory capacity that is produced and shipped.

As the memory business evolves in the coming years, Sandisk's management anticipates that the company will be able to maintain extreme profitability. The multiyear forecasts call for gross margins, a measure of profitability, to "sustain" at around 80% in the period from fiscal 2028 to 2030.

Furthermore, Sandisk's management said it plans to return all of its excess cash to shareholders after making investments into the company.

"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," Sandisk Chief Financial Officer Luis Visoso said in a statement, referring to the company's new business model agreements with customers that span multiple years.

So far, the company has NBMs with eight customers, two of which expanded their deals in the latest quarter. The agreements average around four years. They already make up 50% of Sandisk's bits for fiscal 2027 and about two-thirds of bits for fiscal 2028.

Visoso told MarketWatch that Sandisk wants NBMs to be a predominant practice given that they are profitable and less volatile than the prior ways of structuring deals.

Knowing what customers want for a certain time period allows Sandisk to plan operations and spending, he said. In 2027, Visoso said Sandisk "is building a little bit of safety inventory so that we can fulfill our customer needs."

For now, Sandisk is focused on how to make its business agreements longer, Visoso said. That includes adding more customers or extending deals.

There's still the risk that demand will eventually slow down, as memory is a historically cyclical industry. But Visoso said the NBMs allow Sandisk to define volumes, which will not fluctuate. Given that not all of its business depends on NBMs, he said there will likely be some volatility, though not to the extent that was seen in the past.

Evercore ISI analyst Amit Daryanani noted that Sandisk "expects the agreements to generate highly attractive returns even at floor pricing."

Sandisk also touted momentum for its high-bandwidth flash technology, which Visoso said is expected to take off as AI moves more and more toward inference, or the process by which models draw conclusions based on new information.

Earlier this month, Sandisk and its South Korean peer SK Hynix (KR:000660) (SKHY) announced a consortium to develop industry standards for HBF. The company said at its investor day event that it expects to start shipping HBF samples to customers next year.

Visoso said participation from Google (GOOGL) (GOOG) and Meta Platforms (META) in the HBF consortium help validate how critical the technology will be.

Sandisk's stock is up 541% so far this year.

-Britney Nguyen

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08-13-26 1805ET