Dallas, Texas 07/24/2015 (FINANCIALSTRENDS) – Data storage giant SanDisk Corporation (NASDAQ:SNDK) stock rose by more than 19% on posting an impressive second quarter with earnings per share coming in at $0.66 against consensus estimates of $0.34 a share. Revenue was down by 24% coming in at $1.24 but still met the Street’s expectation. The company expects revenue of between $1.35 billion and $1.45 billion for the current quarter against the Street’s average projection of $1.41 billion.
Prior to the earnings call the stock was down by 45% for the year. Early in the year SanDisk Corporation (NASDAQ:SNDK) had said it was facing manufacturing problems that were creating low yields. The news was not met well by the Street as it meant inventory levels were under pressure on the company’s inability to meet demand. The announcement followed the slashing of the full year outlook on the company losing a key customer.
However, sentiments are slowly changing especially on the company posting a better than expected quarterly earnings. Expanding further into Apple Inc. (NASDAQ:AAPL) products heading into year-end could see the company register a further improvement in its earnings. Analysts at Bank of America Merrill Lynch buoyed by the development have upgraded the stock to a ‘buy’ with other upgrades coming from Nomura research and R. Riley & Co.
Growing Demand for SSDs
A decline in revenue was down to the company facing qualification issues on its SSD product, which led to lower revenue for the segment. SanDisk Corporation (NASDAQ:SNDK) says it has found a fix for the problem and expects to see revenue growth from the segment in the fourth quarter. Retail and enterprise revenue were up even as the average selling price declined by six percent.
SanDisk Corporation (NASDAQ:SNDK)’s Solid State Drives SSDs continue to experience better than expected demand as SanDisk’s tries to encourage more OEMs to upgrade from traditional hard disk drives.