Sandisk Corporation (NDQ:SNDK): Meet The Former Flash Drive Play That Replaced Atlassian in The NASDAQ 100!

The downfall of Atlassian is best summed up by the fact that it was replaced by Sandisk Corporation (NDQ:SNDK), a company once known for flash drives. But we thought rather than focusing on the negative side of the story (Atlassian’s fall), it was time to take a look at the positive angle (Sandisk’s rise). Little over a year ago it was spun off from Western Digital (WDC) in February 2025 as a legacy consumer storage brand. But this company has since re-emerged as a pure-play NAND flash infrastructure business at the centre of global AI compute demand.

The stock has risen from an all-time low of approximately US$28 in early April 2025 (less than 14 months ago) to an all-time high near US$1,600 in late May 2026, a gain of roughly 5,600% in thirteen months. Consensus estimates suggest staggering growth, and if you thought that meant an expensive stock from a multiples perspective, you’re wrong. It is just 8x FY27 P/E at the current share price and at a PEG ratio of less than 0.1x.

Sandisk Corporation (NDQ:SNDK): Formerly in flash drives, now in AI!

Sandisk was founded in 1988 in Silicon Valley as SunDisk, the creation of three engineers (Eli Harari, Sanjay Mehrotra, and Jack Yuan) who set out to prove that semiconductor-based storage could replace mechanical spinning media. The company produced the world’s first flash-based solid-state drive in 1991, renamed itself SanDisk in 1995, and listed on the Nasdaq that same year.

For two decades it built a global consumer franchise in SD cards, USB drives, and embedded storage, before Western Digital absorbed it in a US$19bn acquisition in 2016. The flash business spent nine years submerged within WDC’s broader storage conglomerate. It was always valuable, but strategically constrained by proximity to the slower-growth hard disk drive business that sat alongside it.

In October 2023, WDC announced its intention to separate the two, and the spin-off was completed in February 2025, with 80.1% of Sandisk’s shares distributed pro rata to WDC stockholders at a ratio of one Sandisk share for every three WDC shares held.

Why Sandisk replaced Atlassian

Atlassian Corporation (NDQ:TEAM), the Australian-founded enterprise software business, had long been a flagship Nasdaq-100 constituent on the strength of its cloud collaboration tools, including Jira and Confluence. However, the SaaS valuation environment deteriorated markedly through 2025 and into 2026 as investors grew impatient with slowing seat-count growth and elevated operating expenditure.

By the time Nasdaq reviewed its constituents in April 2026, Atlassian’s market capitalisation had declined to approximately US$17bn (no longer sufficient to hold its ranking among the 100 largest non-financial Nasdaq-listed companies) and it was removed effective 20 April 2026.

How Sandisk Rose

The contrast with Atlassian’s trajectory could scarcely be starker. Sandisk’s re-listing was not initially celebrated: the stock opened around US$48 and drifted lower through the March quarter of 2025, hitting its nadir of approximately US$28 in early April 2025 against a backdrop of tariff-related market volatility and residual scepticism about whether a NAND flash pure-play could sustain premium margins through the cycle. Those concerns proved short-lived.

The structural driver is the demand for NAND flash memory. This is the storage medium inside every solid-state drive deployed in a data centre, and the proliferation of large language models, agentic AI systems, and high-throughput inference workloads has created a step-change in demand for enterprise-grade SSDs. Sandisk, vertically integrated through a joint-venture manufacturing framework with Kioxia across fabs in Japan, is one of only five meaningful global NAND suppliers. Its BiCS8 3D NAND architecture has been specifically designed for the throughput requirements of hyperscale AI infrastructure, and the company has secured long-term supply agreements with several major cloud providers.

The operational results have reflected this positioning. Sandisk’s revenue for FY25 (the year ending June 2025) came in at US$7,355m — modest on its own, but the composition had already shifted, with the data centre segment accounting for more than half of quarterly sales by the final quarter of FY25, up from roughly 30% at the time of the spin-off. The company also absorbed a GAAP net loss of US$1.64bn in FY25, largely attributable to separation costs and NAND pricing dynamics that have since inflected sharply upward. Normalised EPS for FY25 was US$2.99.

The re-rating gathered pace in the second half of 2025. By October 2025, the stock had reached approximately US$149, a fivefold gain from its April trough. By February 2026, it was trading above US$590. The fourth quarter of 2025 delivered a record EPS beat, with normalised EPS of US$6.20 against a consensus estimate of US$3.31, and revenue rising 61% year-on-year.

The announcement in April 2026 that Sandisk would join the Nasdaq-100 provided a further catalyst, triggering a 6.5% single-session gain on anticipated passive fund inflows from the more than 200 index-tracking products — including the Invesco QQQ Trust — that collectively manage over US$600bn against the benchmark.

The Outlook

Consensus estimates suggest an earnings profile that, if realised, would justify the recent re-rating and then some.

Revenue is expected to more than double between FY26 and FY27 (from US$7.4bn to US$19.5bn), driven by the sustained undersupply of enterprise-grade NAND and Sandisk’s expanded capacity ramp. Converting consensus FY27 EPS of US$175.38 against approximately 148 million shares on issue implies a profit (or net income) of approximately US$26bn for the year ending June 2027 — a figure that would, in isolation, rank Sandisk among the most profitable companies in the S&P 500.

At a current share price of approximately US$1,478, FY27 consensus estimates place the stock on a forward P/E of roughly 8x. That is a valuation one might expect to see on a mature cyclical business with structurally declining earnings, not a company growing normalised profit from US$443m in FY25 to a projected US$26bn in FY27. The implied PEG ratio, using a multi-year EPS growth rate, falls well below 0.1x — a level that, in our view, suggests the market is applying a heavy cyclical discount to what may prove to be more durable structural earnings.

The principal risk to this thesis is NAND cyclicality itself. The industry has a well-documented history of boom-and-bust pricing dynamics, and the FY29 and FY30 consensus estimates (both below FY28 and FY27) suggest analysts do anticipate some normalisation of the current pricing environment. Sandisk’s balance sheet is comparatively lean, with a debt-to-equity ratio of approximately 0.08x, which provides meaningful downside protection if the cycle turns sooner than expected.

Conclusion

Sandisk’s inclusion in the Nasdaq-100 is, in the most literal sense, an index event. But it is also a signal about the structural rotation underway in the technology sector: away from software multiples built on recurring revenue contracts and toward the hardware infrastructure that underpins the AI compute cycle. The company’s origins in consumer flash storage (SD cards, thumb drives, the physical media of a pre-cloud era) make the current scale of its earnings inflection all the more striking.

Consensus estimates, if achieved, imply a business generating over US$26bn in net income within two years, trading at 8x those earnings. The cyclical risks are real and should not be dismissed, but the valuation on offer at current levels appears to price in a great deal of pessimism that the near-term earnings trajectory does not yet support.