SNDK
The good news is hiding under the bad vibes
SanDisk’s latest earnings setup may have left investors grumpy, but BNP Paribas wants you to look past the short-term mood swing. Its take: the bigger story isn’t the softer guidance — it’s that AI customers are starting to behave like they actually mean it.
No more “trust us, bro” demand forecasts
According to BNP, SanDisk has now signed five more long-term agreements, bringing the total to 10 contracts with minimum expected revenue of $93.9 billion. The part that turns heads? Those deals reportedly include $16.5 billion in financial guarantees. In other words, hyperscale customers aren’t just reserving future storage capacity like they’re hoarding concert tickets — they’re putting real money on the line.
That matters because memory has historically been a boom-bust soap opera. One minute demand is scorching, the next everyone’s overstocked and staring at a wall of red inventory. BNP says these contracts could help SanDisk smooth that chaos, with the agreements expected to cover roughly half of shipment volume in fiscal 2027 and about two-thirds in fiscal 2028.
Why the stock still got a reality check
Even with that long-term AI visibility, BNP didn’t exactly go full victory lap. It kept a Neutral rating and cut the price target to $1,400 from $1,900, pointing to peer multiple compression, softer consumer demand, tougher China competition, rising inventories, and the worry that gross margins may already be near their high-water mark.
So the takeaway is messy, but useful: SanDisk may be building a more predictable AI storage business, even if Wall Street is still demanding proof before it stops squinting at the near-term numbers. Big picture: the market may be underestimating how quickly AI demand is turning from a forecast into a contract.