SanDisk (SNDK.US) releases long-term guidance for Deluxe Corporation: revenue growth in the mid to high double digits, gross margin around 80%, and FCF profit margin around 50%.

SanDisk (SNDK.US) unveiled its long-term growth strategy and a new multi-year financial framework at its Investor Day on Thursday, 2026. The company stated that as artificial intelligence (AI) expands from training to reasoning, the demand for high-performance, high-capacity, and low-power storage in data centers will significantly increase, with the potential market size for enterprise data center flash memory expected to grow to 1.2ZB by 2030. Meanwhile, SanDisk anticipates that revenue for the fiscal years 2028 to 2030 will continue to grow at a mid-to-high double-digit rate, with a non-GAAP gross margin maintained at approximately 80%, and an adjusted free cash flow profit margin reaching around 50%. David Goeckeler, Chairman and CEO of SanDisk, stated that the company's strong current performance stems from the consistent execution of its established strategy over the past 18 months. With decades of accumulated NAND flash technology expertise, system-level technological capabilities, a diversified product portfolio, a capital-efficient operational model, and the ability to cover the entire technology stack, the company has established a differentiated competitive advantage and will continue to serve various end markets to create long-term value for shareholders. SanDisk believes that the rapid adoption of AI is transforming traditional storage architectures. As AI reasoning workloads grow and Token usage surges, KV Cache (key-value cache) is reshaping memory and storage hierarchies in AI systems, making future AI data centers more "storage-intensive." The company expects that by 2030, the potential market size for enterprise data center flash memory will reach 1.2ZB. SanDisk indicated that its product portfolio will focus on meeting the requirements of AI infrastructure for higher performance, lower power consumption, and greater storage density, viewing AI reasoning as an important driver for future business growth. On the technological front, SanDisk announced a two-dimensional extension strategy based on CMOS Direct Bonding to Array (CBA) technology, enabling the development of customized products in response to rapidly changing market demands while enhancing capital utilization efficiency. The newly launched BiCS9 QLC technology is the first instance of this strategy, combining the mature BiCS8 storage array with CMOS wafers based on BiCS10 technology to deliver the high performance required for AI workloads in a more capital-efficient manner. Meanwhile, the new-generation BiCS10 QLC node offers a 60% increase in bit density compared to BiCS8, with the company stating it will set a new industry standard in terms of storage density, performance, and energy efficiency. In addition to technological upgrades, SanDisk is mitigating traditional cyclical fluctuations in the NAND industry through new business model agreements (NBM). Such agreements include committed purchase volumes, binding contractual frameworks, minimum financial guarantees, and structured pricing mechanisms, helping to better align customer demand with the company's capacity planning. Currently, SanDisk has signed NBM agreements with eight customers, which are expected to cover approximately 50% of the company's bit shipments in the fiscal year 2027, rising to around two-thirds in fiscal year 2028. The company stated that NBM is rapidly becoming its primary business model, expected to enhance predictability of future revenues and cash flows while supporting more stable long-term profit growth. SanDisk also highlighted HBF technology, viewing it as a key product direction for capturing storage demand in the AI reasoning era. The company stated that HBF is becoming an important technology to address the new opportunities presented by the AI reasoning era, and that an industrial ecosystem centered around HBF is gradually forming to support broader technology adoption in the future. At this Investor Day, SanDisk also unveiled its long-term financial model covering the fiscal years 2028 to 2030 for the first time. The company expects revenue during this period to achieve mid-to-high double-digit growth, largely in line with bit shipment growth; non-GAAP gross margins are expected to remain at approximately 80%, with non-GAAP operating margins around 75%, while operating expenses are expected to account for about 5% of revenues. After accounting for taxes, capital expenditures, and working capital needed to support growth, the company anticipates an adjusted free cash flow profit margin of approximately 50%. Luis Visoso, Chief Financial Officer of SanDisk, stated that the company operates in a large and rapidly growing market, with favorable industry driving factors. The company will focus on balancing growth, business sustainability, and capital returns. After meeting the investment needs for business development, SanDisk plans to return 100% of its remaining cash to shareholders. Management expressed confidence in the sustainability of this long-term financial model, largely derived from multi-year NBM agreements signed with customers, as well as customer relationships built on technological innovation and deep collaboration. Overall, SanDisk emphasized the growth in storage demand driven by AI reasoning as a key pillar of its long-term strategy, aiming to expand its AI data center business while mitigating traditional cyclical impacts in the storage industry through NAND technology upgrades, new storage technologies such as HBF, and long-term customer agreements. The expected 1.2ZB enterprise data center flash market by 2030, along with targets of around 80% non-GAAP gross margin and approximately 50% adjusted free cash flow profit margin for fiscal years 2028 to 2030, emerged as the most notable metrics in this long-term strategy. As of the time of publication, SanDisk's stock price surged more than 13%, reaching $1521.90.