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SNDK stock is drawing investor attention as Sandisk Corporation benefits from an explosive increase in artificial intelligence infrastructure spending. The company’s data center business delivered exceptional growth in fiscal 2026, supported by rising demand for enterprise solid-state drives, high-capacity storage and data-intensive AI workloads.
According to an analysis from Zacks Investment Research, Sandisk’s data center opportunity is becoming one of the company’s most important growth engines. The business is expanding rapidly, although investors are also watching valuation, competition and the possibility that expectations have already risen significantly.
SNDK Stock Benefits From Explosive Data Center Growth
Sandisk reported data center revenue of $2.98 billion in the fourth quarter of fiscal 2026, representing a 103% sequential increase. For the full fiscal year, data center revenue climbed 437% year over year to $5.15 billion.
The shift has also changed the company’s business mix. Data centers accounted for approximately 38% of Sandisk’s bit portfolio at the end of fiscal 2026, compared with around 12% a year earlier. The sharp increase highlights how quickly AI infrastructure is reshaping demand for storage products.
AI systems require substantial amounts of data for training, inference and ongoing model updates. While high-performance computing components often receive the most attention, storage has become an increasingly important part of the AI data center architecture. Enterprise SSDs help organizations manage large data lakes and process information more quickly than traditional hard disk drives.
Powerful Product Expansion Targets AI Workloads
Sandisk is expanding its product portfolio to address different storage requirements across modern data centers. During the fourth quarter, the company began shipping its QLC Stargate platform, which is designed to support high-capacity AI data lakes.
The platform complements Sandisk’s compute-focused TLC enterprise SSDs. The company is also developing High Bandwidth Flash, a technology intended to address the increasing storage and memory needs associated with AI inference workloads.
Management expects the NAND market to exceed $300 billion in 2026 and approach $500 billion in 2027. Sandisk also expects data center demand to grow faster than the overall NAND market next year, creating a potentially favorable environment for suppliers with strong enterprise storage products.
Long-Term Customer Deals Improve Sandisk’s Visibility
Sandisk is pursuing longer-term relationships with major data center and edge customers through its New Business Models. The company has signed agreements with eight customers, with a weighted average duration of more than four years.
These agreements are expected to cover more than half of Sandisk’s bits in fiscal 2027 and approximately two-thirds in fiscal 2028. Such commitments could give the company improved visibility into future demand while helping management plan manufacturing capacity, capital spending and product investments.
Management indicated that customer demand could remain strong through the end of 2027 and into 2028. However, long-term agreements do not eliminate risks related to pricing, execution, customer concentration or changes in technology spending.
Micron and SK Hynix Create Fierce Competition
Sandisk is not alone in pursuing the AI storage opportunity. Micron Technology and SK hynix are also expanding their memory and enterprise SSD businesses to serve data center customers.
Micron expects strong memory demand through 2028, supported by rising server shipments and the adoption of agentic AI. The company has said that more than 75% of its fiscal 2027 shipments are committed, reflecting strong customer demand and tight market conditions.
SK hynix is increasing production of its 321-layer NAND technology and expanding high-performance enterprise SSD supply. In the third quarter of 2026, the company reported that NAND average selling prices increased by the mid-20% range sequentially. It is also developing solutions for storing and reusing AI inference data, including key-value cache, commonly known as KV cache.
Valuation Is a Critical Consideration for SNDK Stock
SNDK stock has delivered an extraordinary performance, rising 491.8% year to date and significantly outperforming the broader Zacks Computer and Technology sector, which gained 16.5% during the same period.
That powerful rally has also made valuation a central issue. Sandisk is trading at a forward 12-month price-to-sales ratio of 3.88 times, compared with 2.51 times for the Computer-Storage Devices industry. Zacks assigns Sandisk a Value Score of C.
At the same time, the Zacks Consensus Estimate for fiscal 2027 earnings stands at $215.04 per share. The estimate recently increased by 0.8% over seven days and implies 203.4% growth from the year-ago period. Zacks currently rates Sandisk as a Rank #1, or Strong Buy.
For investors, the central question is whether data center growth can continue at a pace capable of supporting the company’s elevated valuation. Strong enterprise SSD demand, new storage platforms and multiyear customer agreements offer meaningful advantages. Still, competition and the cyclical nature of the NAND market remain important risks.
Frequently Asked Questions About SNDK Stock
Why is SNDK stock gaining attention?
SNDK stock is gaining attention because Sandisk’s data center revenue grew sharply in fiscal 2026 as AI infrastructure increased demand for enterprise SSDs and high-capacity storage.
How much did Sandisk’s data center revenue grow?
Data center revenue reached $2.98 billion in the fourth quarter of fiscal 2026, up 103% sequentially. Full-year data center revenue increased 437% to $5.15 billion.
Who competes with Sandisk in AI storage?
Micron Technology and SK hynix are major competitors. Both companies are expanding enterprise SSD, NAND and memory capacity to serve AI data center customers.
Is SNDK stock considered undervalued?
Sandisk’s strong growth has attracted positive analyst attention, but its forward price-to-sales ratio is above the industry average. Investors should weigh growth potential against valuation and market-cycle risks.
