AI Applications Drive Up Storage Needs: Can Sandisk Capitalize on the Opportunity?

Sandisk Poised to Gain from Surging AI Storage Needs

As artificial intelligence workloads expand rapidly, global demand for data storage is soaring. Sandisk (SNDK) stands out as a major beneficiary of this trend. Both AI training and inference generate massive amounts of data, requiring advanced storage solutions that can deliver high capacity and low latency. With hyperscale cloud providers and enterprises investing heavily in AI infrastructure, the need for robust NAND flash storage is accelerating. According to , the worldwide AI-powered storage market is expected to grow at a compound annual rate of 25.2% from 2026, reaching $271.32 billion by 2034.

Sandisk’s product lineup is well-suited to meet these evolving requirements. The ongoing rollout of BiCS8 technology is enhancing its competitive edge, as the amount of NAND used per AI deployment rises. Additionally, its high-performance PCIe Gen5 enterprise SSDs are gaining popularity among hyperscalers building out AI systems. The BiCS8 QLC Stargate product, currently undergoing qualification, has the potential to further boost Sandisk’s presence in data centers in the near future.

This technological progress is reflected in Sandisk’s financial results. In the fiscal second quarter, data center revenue surged 76% year over year, driven by strong adoption of enterprise SSDs. Overall revenue climbed 61% to $3.03 billion. With demand outstripping supply, Sandisk projects third-quarter fiscal 2026 revenue between $4.4 billion and $4.8 billion, representing a midpoint growth of 171% year over year.

The Zacks Consensus Estimate places Sandisk’s third-quarter fiscal 2026 revenue at $4 billion, a 136.14% increase from the previous year. As the data center segment is expected to become the largest market for NAND by 2026, Sandisk is well-positioned to capture ongoing value from the rising demand for AI-focused storage solutions.

Competitive Landscape for SNDK

Sandisk faces intense competition as other industry players also target the expanding AI storage market.

• Western Digital (WDC) is a direct competitor in the NAND flash and enterprise SSD space, serving hyperscale data centers and sharing similar markets with Sandisk. Western Digital also benefits from strong partnerships with major cloud providers investing in AI infrastructure.
• Seagate Technology (STX) primarily focuses on hard disk drives for large-scale storage. While Seagate is well-placed for cost-effective cloud storage, it has less exposure than Sandisk to the high-performance flash storage increasingly needed for AI workloads.

SNDK’s Stock Performance, Valuation, and Analyst Estimates

Over the past three months, Sandisk shares have soared 219.9%, significantly outperforming the broader Zacks Computer and Technology sector, which declined by 1.3% during the same period.

SNDK Stock Outpaces the Sector

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Currently, SNDK trades at a forward 12-month price-to-sales ratio of 4.43, compared to the Zacks Computer-Storage Devices industry average of 2.32. Sandisk holds a Value Score of F.

SNDK Valuation Overview

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The Zacks Consensus Estimate for Sandisk’s fiscal 2026 earnings stands at $31.37 per share, reflecting a 15.3% increase over the past month. For fiscal 2025, Sandisk reported earnings of $2.99 per share.

Sandisk Corporation Price and Consensus

Sandisk Corporation price-consensus-chart | Sandisk Corporation Quote

Sandisk currently carries a Zacks Rank #1 (Strong Buy). You can view the full list of today’s Zacks #1 Rank stocks here.

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