SanDisk Q3 Profit Surges

(RTTNews) - Flash-memory card maker SanDisk Corp. (SNDK), Wednesday reported a more than three-fold jump in third-quarter profit, led by higher revenue and margins, with results topping Wall Street estimates.

SanDisk also announced a quarterly cash dividend of 22.5 cents per common share, having established its first ever dividend program in July.

Following the announcement, SanDisk shares touched a new high for the year - gaining 2.4 percent at $64.65 in after-hours trade on the Nasdaq.

"We delivered outstanding third quarter results driven by our strategy to shift to higher value solutions across our portfolio, " said CEO Sanjay Mehrotra.

SanDisk makes removable cards, embedded flash products, USB flash drives and solid-state drives used in place of hard disk drives. Its products are used in mobile phones and other devices.

The company had been on a rough patch after successive quarters of lackluster earnings amid sluggish demand and weaker prices for DRAM and NAND flash chips. But its stoicism has paid off and has reaped better prices for memory chips.

Milpitas, California-based SanDisk posted quarterly net income of $277 million or $1.18 per share, compared with $77 million or $0.31 per share last year.

Results for the recent quarter include impairment charges of $83 million, mainly related to its 2011 acquisition of Pliant Technologies.

Excluding items, adjusted earnings for the quarter were $371 million or $1.59 per share, compared with $118 million or $0.48 per share a year ago.

On average, 27 analysts polled by Thomson Reuters expected earnings of $1.32 per share for the quarter. Analysts' estimates typically exclude special items.

Revenue for the quarter jumped 28 percent to $1.63 billion from $1.27 billion in the prior year. Analysts had a consensus revenue estimate of $1.57 billion for the quarter.

Gross margin for the quarter improved to 49.3 percent from 30 percent a year ago and operating margin rose to 25 percent from 10.4 percent.

SanDisk stock closed Wednesday at $62.94, up $0.25 or 0.40%, on a volume of 5.5 million shares on the Nasdaq. In after hours, the stock gained $1.51 or 2.40% at $64.45. In the last 52 weeks, the shares traded in a range of $38.47 - $63.97.