IT News on October 30: After the US stock market closed on October 29, SanDisk released its financial report for the first quarter of fiscal year 2027. For the first quarter ending October 2, revenue reached $11.031 billion (Note from IT: The current exchange rate is approximately 73.652 billion RMB), a 23% increase from the previous quarter and a 378% increase year-over-year. The non-GAAP gross margin was 85.1%, and the non-GAAP diluted earnings per share were $49.51, both exceeding the company's previous forecasts. During the same period, the company generated $5.7 billion in adjusted free cash flow.

Sandisk management stated during the fourth-quarter 2027 earnings call held on Thursday Eastern Time that "about 60% of the revenue growth this quarter was due to increased sales volume, and 40% was due to price increases." Based on strong order visibility, Sandisk expects revenue in the second fiscal quarter to be between $12.2 billion and $12.6 billion. At the same time, the company has committed to returning 100% of its excess cash to shareholders and has already invested $5 billion this quarter in share repurchases.

SanDisk Chairman and CEO David Goeckeler stated that the data center business has grown from accounting for about 20% of the industry's total ten years ago to nearly half today. Looking to the future, it is expected that data centers will account for over 55% of the market share by 2027, with bidding demand expected to increase by about 40% year-on-year. Goeckeler also predicted: "By the end of this decade, key-value caching ( KV Cache ) will account for about one-third of the flash memory market in artificial intelligence data centers, while the market size of artificial intelligence data centers will approach today's NAND flash memory market."

Goeckeler In general, we have learned from our customers that they underestimated the NAND flash memory capacity required to operate the infrastructure. Not only are many existing customers placing additional orders, but new customers are also continuing to come in. We now have a strong supply channel that will last until 2030 and beyond.

Currently, approximately 50% of SanDisk's production capacity for the fiscal year 2027 has been allocated to the new business module (NBM) project, and this proportion is expected to rise to about two-thirds in 2028. Management anticipates that the reserves for the (NBM) project will exceed the company's supply volume by the end of this decade.