Sandisk Corp is actively pursuing extended supply agreements with data center operators as AI-driven demand alters the dynamics of the NAND flash market, CEO David Goeckeler said Wednesday at Bernstein's TMT Forum. The company is working to replace the industry's conventional quarterly pricing focus with multi-year arrangements that provide both demand visibility and commercial attractiveness.
Goeckeler described the evolution of these deals from short-term price negotiation tools into mechanisms designed to guarantee supply as data center customers increasingly dominate NAND consumption. Sandisk now expects the data center segment to be the largest market for NAND flash in calendar 2026, a shift reflected in the company’s internal growth forecasts, which have risen from mid-20% to mid-to-high 60% over two forecast cycles.
Operationally, the company said the transition is already visible in recent results. Sandisk reported a 64% sequential increase in data center sales in the latest quarter, following a prior period that showed low-to-mid 20% growth. Those trends, management said, are driving a need for more predictable supply arrangements.
Hyperscalers are providing demand forecasts stretching into 2028, prompting Sandisk to negotiate contract terms that range from one to five years. Goeckeler emphasized the dual objective of securing attractive economics while ensuring business sustainability. He said management plans to construct a mix of fixed and variable pricing structures so the portfolio can perform under differing market conditions.
CFO Luis Visoso added that allocation priority during tight supply periods will favor customers willing to commit on longer time horizons, while customers that opt to maintain quarterly negotiations may encounter constrained availability.
On capacity and technology roadmaps, Sandisk reaffirmed its investment plan targeting mid-to-high teens bit growth. The company expects to exit fiscal 2026 with BiCS8 as its predominant technology node. Goeckeler addressed market speculation about accelerating BiCS10 deployment, stating that existing capacity plans are sufficient and that the company is not moving up BiCS10 acceleration to meet demand.
Sandisk reported holding roughly 25% share in the edge computing market and said it is broadening its enterprise solid-state drive portfolio. The company is qualifying new enterprise SSDs with hyperscalers, including a 128 terabyte QLC drive codenamed Stargate, which has not yet begun revenue shipments.
In parallel, Sandisk is developing a high-bandwidth flash technology in collaboration with SK Hynix aimed at inference workloads in AI applications. Management described the technology as offering 10 times the density of alternative approaches. Sandisk expects prototype dies to be available by late 2026, with customer testing systems coming approximately one year later.
To secure manufacturing throughput, Sandisk extended its joint venture with Kioxia for an additional five years, locking in capacity through 2034. Management said the extended partnership allows Sandisk to invest in research and development at levels comparable to the largest market-share competitors while preserving cost leadership.
The company’s strategic moves - pursuing multi-year contracts, refining its product pipeline and extending manufacturing partnerships - reflect a concerted effort to align commercial terms and capacity with the changing demand profile driven by AI workloads. Management’s comments underline a deliberate push to balance supply assurance for hyperscalers with financial discipline across market cycles.