Sandisk reports fiscal first quarter 2027 results on Thursday, October 29, after the close, and the September quarter is already spoken for. Management guided in August to revenue of $10.3 billion to $10.8 billion, gross margin of 83% to 85% and adjusted EPS of $44 to $46. Consensus sits at roughly $10.7 billion and $46 to $47, near the top of the range. Sandisk has beaten in each of its last four quarters, usually by double digits on EPS. Nobody is trading this print on the September number.
The number that matters is the December guide, and the cleanest way to frame it is to look at what the September guide already did. At the midpoint, $10.55 billion is 17.7% above the $8.97 billion fiscal Q4. TrendForce had NAND contract prices rising 10% to 15% for the same calendar quarter. Sandisk guided above the price curve by somewhere between three and seven points, and the gap is mix. Enterprise SSD carries the higher price increases and a growing share of the bits, so the company’s blended revenue line runs ahead of the industry’s blended price index.
Apply the same logic to the December quarter. TrendForce now expects overall NAND contract prices up 15% to 20% quarter over quarter, with enterprise SSD up 23% to 28%. A guide that tracks overall pricing lands at $12.1 billion to $12.7 billion. A guide that tracks the enterprise curve, which is where the mix keeps moving, lands closer to $13 billion. Anything below $12 billion would mean the mix tailwind has stopped or consumer volumes are falling faster than prices rise. That is the line to watch. August showed what a light guide costs: a clean beat on every line, a revenue outlook a little short of an inflated consensus, and the shares down about 7% after hours.
The stock comes into the print with the excitement already taken out. SNDK closed at $1,394.83 on October 15 after six straight losing sessions, about 41% below the June 22 record of $2,354.39, for a market cap near $204 billion on 146.42 million shares. It was still up close to 490% for the year. Annualise the midpoint of the September EPS guide and the shares trade at under 8x run-rate earnings. A multiple that low on a company growing revenue five-fold in a year is a statement about duration. The market is pricing the September quarter as something close to a peak, and it wants proof otherwise.
That proof sits in the contract book, which is also where the moat is. Sandisk’s new business model agreements carry floor prices and, per the company, cover more than half of fiscal 2027 bits and about two thirds of fiscal 2028, with bits on allocation beyond calendar 2027. Floors at roughly $0.29 per gigabyte put a bottom under the downside that no NAND supplier has had in a prior cycle. They also mean the uncontracted half of the business is where the December upside comes from, so the spot-exposed share will carry more of the Q2 growth than the headline suggests. Behind the contracts sits the structure. The Kioxia joint venture, extended at Yokkaichi through 2034, keeps the manufacturing base off Sandisk’s own balance sheet, and net PP&E of well under $1 billion against a revenue run rate above $40 billion is the reason an 84% gross margin is possible at all. Competitors who own their fabs have to fund their own capacity. Sandisk funds a share of a shared one.
Capital return is the third input. The company repurchased $4.5 billion of stock in fiscal Q4, most of it above where the shares trade today, and has a fresh $14 billion authorisation. At the current market cap, that authorisation is close to 7% of the company. How quickly it gets used tells you how management reads its own multiple.
The base case is a September quarter at or slightly above the top of guidance and a December guide of $12 billion to $12.7 billion with gross margin held in the mid-80s, which supports $1,400 to $1,700 and lets the multiple stop compressing. The bull case is a guide at or above $13 billion, another signed NBM customer or an increase in fiscal 2028 coverage, and gross margin guided at or above 85%, which reopens the path toward the roughly $2,140 average street target, against a range that runs from $1,000 to $3,600. The bear case is cohort derating rather than a broken quarter. A guide under $11.5 billion, or gross margin guided toward the high 70s, would put SNDK back with Kioxia, Micron and the Korean names as a cyclical memory stock on a peak-earnings multiple, and $1,000 to $1,150 becomes the range, with the low end matching the lowest target on the street. Options were pricing a move of about 11% either way.
One number decides which of those three it is. Watch the gross margin guide for the December quarter. If it holds at 84% or better while revenue grows another 15%, pricing power is still with the supplier and the contract book is doing its job.