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SanDisk Corporation (SNDK), Micron Technology, Inc. (MU): Is It Time to Sell This Flash Memory Supplier?

SanDisk Corporation (NASDAQ:SNDK), the leading flash-memory developing company, shared its quarterly results last month and performance was marvelous. The company effortlessly surpassed the consensus estimates. After the stellar performance in the previous quarter, I believe the company may have maxed out its profits and will be unable to show similar returns in the future. Why? I will let you know. But first, let’s take a look at the factors that led to the significant growth.

Quarter’s analysis

SanDisk Corporation (NASDAQ:SNDK)SanDisk Corporation (NASDAQ:SNDK)’s revenue for the second quarter exceeded the analysts’ estimate of $1.4 billion to reach approximately $1.5 billion, signifying an increase of 43% versus the previous fiscal year. The increase in net income was even more impressive, as it surged to $261.8 million from slightly less than $13.0 million year-over-year translating to earnings per share of $1.21.

This amazing increase of the company’s margins was primarily driven by the ever-growing demand for SanDisk Corporation (NASDAQ:SNDK)’s products, while the inflated price of its microSD cards also helped the cause.

Further, most of the premium mobile-phone retailers continued to provide card slots, which enabled customers to expand the phone’s storage beyond the embedded capacity, paving way for SanDisk Corporation (NASDAQ:SNDK)’s microSD cards. This resonated with the hiked prices and enabled the company to show great returns.

Apart from that, the increase in the demand of highly proficient solid-state drives, commonly known as SSD’s, gave SanDisk Corporation (NASDAQ:SNDK) a competitive edge over its rivals.

The way ahead

The results of the previous quarter were amazing, but now let me tell you what SanDisk Corporation (NASDAQ:SNDK) has in store for the future.

Flaunting a delightful fiscal year, SanDisk eyes the peak and hopes to retain the top position in flash-memory arena. These hopes are driven by constant technological advancements in the field of storage solutions, such as opting for SMART storage systems, which enrich the quality of its products.

By the beginning of the third quarter, SanDisk had launched the world’s fastest 64 GB microSD card, further expanding its flash-memory empire. Later, it released SanDisk Connec, representing its vision about next-generation portable storage, which includes simplified accessing and sharing of content through handsets.

An increasing number of external memory-supporting devices, such as phones, tablets, and cameras, promises high demand for SanDisk’s microSD cards, which means a strong future for SanDisk, but since it’s a lucrative market competition will surely intensify.

Squashing the thought that SanDisk is limited to the flash-memory market, it invested in Pebbles Interface, which gives an insight about SanDisk’s role in the next-generation human machine relations. Pebbles Interface promises a whole new user experience when touch interface would be replaced by gestures, and with that SanDisk scores high on the expectations board.

Fierce competition

SanDisk’s plans for the future may not be enough because of the cutthroat competition. There are a few companies that may really dent SanDisk’s sales in the future. What are those companies? Let us look at them one by one.

Samsung (NASDAQOTH:SSNLF), the smartphone king, sure is one tough competitor, with its gadgets dominating the markets worldwide. Samsung mainly deals in electronic equipment, such as televisions, laptops, mobile phones etc. and with flash memory being one of the branches of its huge empire.

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