Market Overview - Major indexes closed off session lows, with the Dow up +55 points (+0.11%) and the S&P 500 down -0.13%. The Nasdaq fell -172 points (-0.72%) before recovering somewhat [1] Microsoft (MSFT) - Microsoft experienced a significant sell-off due to higher-than-anticipated AI spending and OpenAI exposure, resulting in a market cap loss of -$430 billion in one day. Despite beating earnings expectations for fiscal Q2, the outlook on AI spending appears riskier [2][8] Meta Platforms (META) - In contrast to Microsoft, Meta Platforms saw a +10.4% increase in stock price, benefiting from its AI investments in advertising and marketing, which are yielding gains in the social media space [3] Apple (AAPL) - Apple outperformed expectations in its fiscal Q3 report, with earnings of $2.84 per share surpassing the $2.65 consensus. Revenues reached $143.76 billion, exceeding expectations and showing a +16% year-over-year increase. iPhone sales rose +23% year-over-year to $85.27 billion, driven by a +38% surge in China sales [4][5] Visa (V) - Visa reported earnings of $3.17 per share, beating estimates by three cents, with revenues of $10.9 billion, a +15% increase from the previous year. However, concerns about future growth arise from proposed caps on credit card rates [6] SanDisk (SNDK) - SanDisk posted a remarkable earnings beat of $6.20 per share compared to the anticipated $3.54, with revenues of $3.03 billion. The company provided optimistic next-quarter earnings guidance of $12-14 per share, significantly higher than the Zacks consensus of $5.36. SanDisk's Data Center business saw a +64% growth quarter over quarter [7]

US stocks fell on Friday as President Trump said he would nominate Kevin Warsh to lead the Federal Reserve, against a background of a rising dollar and tumbling gold. The S&P 500 (^GSPC) slid 0.2%, while the tech-heavy Nasdaq Composite (^IXIC) fell 0.3%, pointing to another down session for tech stocks. The Dow Jones Industrial Average (^DJI) dipped below the flat line. Markets are calculating the potential impact after Trump said he has chosen frontrunner Warsh as the US central bank's next chair, in a ...

Financial Data and Key Metrics Changes - Revenue for the second quarter of fiscal 2026 was $3 billion, up 25% year-over-year, driven by strong demand for Nearline drives [12] - Earnings per share (EPS) was $2.13, an increase of 78% year-over-year, exceeding guidance [15] - Gross margin improved to 46.1%, up 770 basis points year-over-year and 220 basis points sequentially [13][14] - Operating income was slightly above $1 billion, translating into an operating margin of 33.8% [14] Business Line Data and Key Metrics Changes - Cloud segment represented 89% of total revenue at $2.7 billion, up 28% year-over-year [13] - Client segment accounted for 6% of total revenue at $176 million, up 26% year-over-year [13] - Consumer segment represented 5% of revenue at $168 million, down 3% year-over-year [13] Market Data and Key Metrics Changes - The company shipped over 3.5 million units of its latest generation ePMR products, offering capacities up to 32 TB [12][8] - The company delivered 215 exabytes (EB) to customers, up 22% year-over-year [12] Company Strategy and Development Direction - The company is focusing on AI and cloud storage solutions, emphasizing high-capacity drives and partnerships with hyperscale customers [7][9] - A strategic investment in Qolab was announced to advance next-generation nanofabrication processes [10] - The company is hosting an innovation day to share updated roadmaps for HAMR and ePMR products [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued demand for storage solutions driven by AI and cloud growth [5][6] - The company anticipates revenue for Q3 fiscal 2026 to be around $3.2 billion, reflecting approximately 40% year-over-year growth [17] - Management highlighted a stable pricing environment and ongoing cost reductions, projecting further gross margin expansion [22][23] Other Important Information - The company returned $1.4 billion to shareholders through share repurchases and dividends since the launch of its capital return program [16] - The board approved a quarterly cash dividend of $12.50 per share, payable on March 18, 2026 [16] Q&A Session Summary Question: Gross margin guidance and durability of incremental margin - Management confirmed a gross margin of 46.1% and guidance of 47%-48%, with incremental margins around 75% [20][22] Question: Purchase orders and pricing strategy - Management indicated strong demand and stable pricing, with long-term agreements in place with top customers [27][28] Question: Customer engagement and contracts - The company has developed a customer-centric approach, resulting in longer-term contracts and improved relationships with hyperscale customers [34] Question: UltraSMR mix and gross margins - Management noted an increasing mix of UltraSMR drives, which are beneficial for both customers and profitability [42][43] Question: Yields and reliability of products - Yields on ePMR products are in the low 90s%, with positive feedback on reliability from customers [46] Question: HAMR roadmap and investments - The company has pulled in the HAMR qualification timeline and expects it to be neutral to accretive to gross margins once ramped [55][77] Question: Revenue per exabyte and mix changes - Revenue per exabyte is driven by strong demand from the cloud segment, with stable pricing trends [81] Question: Cost reductions and future expectations - Current cost reductions are around 10% year-over-year, with potential for further reductions as higher capacity drives are adopted [87]

Financial Data and Key Metrics Changes - Revenue for the second quarter of fiscal 2026 was $3 billion, up 25% year-over-year, driven by strong demand for Nearline drives [12] - Earnings per share (EPS) was $2.13, an increase of 78% year-over-year [15] - Gross margin improved to 46.1%, up 770 basis points year-over-year and 220 basis points sequentially [13][14] - Operating income was slightly above $1 billion, translating into an operating margin of 33.8% [14] Business Line Data and Key Metrics Changes - Cloud segment represented 89% of total revenue at $2.7 billion, up 28% year-over-year [13] - Client segment accounted for 6% of total revenue at $176 million, up 26% year-over-year [13] - Consumer segment represented 5% of revenue at $168 million, down 3% year-over-year [13] Market Data and Key Metrics Changes - The company shipped over 3.5 million units of its latest generation ePMR products, offering capacities up to 32 TB [12][8] - The company delivered 215 exabytes (EB) to customers, up 22% year-over-year [12] Company Strategy and Development Direction - The company is focusing on AI and cloud storage solutions, emphasizing higher density storage to meet growing demand [7][9] - Strategic investments include a partnership with Qolab to advance next-generation nanofabrication processes [10] - The company is hosting an Innovation Day to share updated roadmaps for HAMR and ePMR products [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued demand for storage solutions driven by AI and cloud growth [5][6] - The company anticipates revenue for Q3 fiscal 2026 to be $3.2 billion, reflecting approximately 40% year-over-year growth [17] - Management expects gross margin to be between 47%-48% in the next quarter [17] Other Important Information - The company returned $1.4 billion to shareholders through share repurchases and dividends since the launch of its capital return program [16] - The board approved a quarterly cash dividend of $12.50 per share, payable on March 18, 2026 [16] Q&A Session Summary Question: Gross margin durability and cost curve - Management indicated that the gross margin is expected to maintain a high incremental margin flow-through, with cost per terabyte decreasing by about 10% year-over-year [19][20][22] Question: Purchase orders and pricing strategy - Management confirmed that they have firm purchase orders with top customers through 2026 and established long-term agreements (LTAs) for 2027 and 2028, reflecting the value delivered to customers [26][27] Question: Customer engagement and contracts - The company has developed a customer-centric approach, deepening relationships with hyperscale customers, resulting in longer-term contracts [34][35] Question: UltraSMR mix and gross margins - The UltraSMR mix has crossed 50% and is expected to increase, positively impacting gross margins due to its software-based nature [41][43] Question: Yields and reliability - Yields on ePMR products are in the low 90s%, with good feedback on reliability, contributing to cost reductions as yields improve [46] Question: HAMR roadmap and customer interest - The company has pulled in the HAMR qualification timeline and is starting qualifications with multiple hyperscale customers [64][74] Question: Investments related to HAMR - Ongoing investments in HAMR are expected to be neutral to accretive to gross margins once ramped up [55][77] Question: Revenue per exabyte and mix changes - Revenue per exabyte is driven by strong demand from the cloud segment, with stable pricing trends [80][82] Question: Cost reductions and future expectations - Current cost reductions are about 10% year-over-year, with potential for increases as higher capacity drives are adopted [86]

Financial Data and Key Metrics Changes - Revenue for Q2 2026 was $3 billion, up 25% year-over-year, driven by strong demand for Nearline drives [10] - Earnings per share (EPS) was $2.13, an increase of 78% year-over-year [12] - Gross margin improved to 46.1%, up 770 basis points year-over-year and 220 basis points sequentially [11] - Operating income was slightly above $1 billion, translating into an operating margin of 33.8% [11] - Operating cash flow for the quarter was $745 million, with capital expenditures of $92 million, resulting in free cash flow of $653 million [12] Business Line Data and Key Metrics Changes - Cloud segment represented 89% of total revenue at $2.7 billion, up 28% year-over-year [11] - Client segment accounted for 6% of total revenue at $176 million, up 26% year-over-year [11] - Consumer segment represented 5% of revenue at $168 million, down 3% year-over-year [11] Market Data and Key Metrics Changes - The company shipped over 3.5 million units of its latest generation ePMR products, offering capacities up to 32 TB [10][11] - The demand for higher capacity storage solutions is driven by the growth of AI and cloud technologies [5][6] Company Strategy and Development Direction - The company is focusing on increasing drive areal density and accelerating HAMR and ePMR roadmaps to meet customer demands [5][6] - A strategic investment in Qolab was announced to advance next-generation nanofabrication processes [9] - The company is hosting an innovation day to share updated roadmaps for HAMR and ePMR products [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing demand for storage solutions driven by AI and cloud growth [4][5] - The company anticipates revenue for Q3 2026 to be $3.2 billion, reflecting approximately 40% year-over-year growth [14] - Gross margin is expected to be between 47%-48% for the next quarter [14] Other Important Information - The company returned $1.4 billion to shareholders through share repurchases and dividends since the launch of its capital return program [13] - A quarterly cash dividend of $12.50 per share was approved, payable on March 18, 2026 [13] Q&A Session Summary Question: Gross margin guidance and durability of incremental margin - Management confirmed a stable pricing environment and effective cost control, leading to an expected gross margin of 47%-48% [16][18] Question: Purchase orders and pricing strategy - Management highlighted the value delivered to customers and the stable pricing environment, allowing for better economics in long-term agreements [24][26] Question: Customer engagement and contracts - The company has developed a customer-centric approach, resulting in longer-term contracts and improved relationships with hyperscale customers [31][33] Question: UltraSMR mix and gross margins - The UltraSMR mix has crossed 50% and is expected to increase, positively impacting gross margins due to its software-based nature [38][40] Question: Yields and reliability of ePMR products - Yields on ePMR products are in the low 90s%, with positive feedback on reliability from customers [44] Question: HAMR roadmap and investments - The qualification process for HAMR has been pulled forward, with expectations of neutral to accretive gross margins once ramped [53][70] Question: Revenue per exabyte and mix changes - Revenue per exabyte is driven by strong demand from cloud customers, with stable pricing contributing to growth [78]

Core Insights - Western Digital forecasts third-quarter revenue above Wall Street estimates, indicating strong demand for hard drives and flash storage for AI servers driving growth [1] Company Summary - The company is experiencing increased demand for its products, particularly in the AI server market, which is expected to contribute significantly to revenue growth [1]

Core Insights - The data storage company reported a profit of $1.84 billion, which was significantly enhanced by the growth of artificial intelligence [1] Company Performance - The profit figure of $1.84 billion indicates a strong financial performance for the company, driven by advancements in artificial intelligence [1]

The data storage technology company posted a second-quarter profit of $803 million, up from $104 million a year earlier. ...

Q2FY26 Financial Results Western Digital January 29, 2026 2 WESTERN DIGITAL CORPORATION © 2026 WESTERN DIGITAL CORPORATION OR ITS AFFILIATES ALL RIGHTS RESERVED Disclaimers Forward-Looking Statements This presentation contains forward-looking statements within the meaning of federal securities laws, including statements regarding expectations for: the company's business outlook and financial performance for the fiscal third quarter of 2026 and beyond, and demand and market conditions for our products and gr ...

Core Insights - Sandisk Corporation reported strong financial results for Q2 2026, highlighting a significant increase in revenue and net income, driven by improved product mix and market demand dynamics [2][3]. Financial Performance - Revenue for Q2 2026 reached $3,025 million, up 31% from Q1 2026 and up 61% year-over-year from Q2 2025 [3][4]. - Gross margin improved to 50.9%, a 21.1 percentage point increase from Q1 2026 and an 18.6 percentage point increase from Q2 2025 [3][4]. - Operating income surged to $1,065 million, reflecting a 505% increase from Q1 2026 and a 446% increase year-over-year [3][4]. - Net income for Q2 2026 was $803 million, a 617% increase from Q1 2026 and a 672% increase from Q2 2025 [3][4]. - Diluted net income per share was $5.15, up 587% from Q1 2026 and up 615% year-over-year [3][4]. End Market Summary - Datacenter revenue increased to $440 million, up 64% quarter-over-quarter and up 76% year-over-year [4]. - Edge revenue reached $1,678 million, a 21% increase from Q1 2026 and a 63% increase from Q2 2025 [4]. - Consumer revenue was $907 million, up 39% from Q1 2026 and up 52% year-over-year [4]. Business Outlook - For Q3 2026, Sandisk expects revenue between $4,400 million and $4,800 million, with gross margin guidance of 64.9% to 66.9% [5]. - Operating expenses are projected to be between $496 million and $532 million [5]. Company Background - Sandisk is a leading developer and manufacturer of data storage devices based on NAND flash technology, providing solutions for various markets including consumer and enterprise [11].