Revenue Increases 26% Year-Over-Year
Milpitas, CA, April 26, 2007 - SanDisk® Corporation (NASDAQ:SNDK), the world's largest supplier of flash storage card products, today announced results for the first quarter ended April 1, 2007. First quarter revenue increased 26% on a year-over-year basis to $786 million and the net loss in accordance with U.S. Generally Accepted Accounting Principles (GAAP) was $0.6 million, or $0.00 per share, compared to GAAP net income of $35 million, or $0.17 per share, in the first quarter of 2006.
Excluding the impact of acquisition related charges, stock compensation expense and the related tax effect, first quarter non-GAAP net income was $45 million, or $0.19 per share, compared to first quarter 2006 non-GAAP net income of $90 million, or $0.44 per share.
"First quarter results reflected the current difficult market conditions," said Eli Harari, Chairman and CEO. "In the first quarter our industry experienced excess supply, sharp price declines, and depressed margins. These market conditions were exacerbated by weak seasonal consumer demand in retail. One highlight for the quarter was that the mobile market became our largest revenue generator with 27 million units sold in the quarter. Another highlight was the signing of an important licensing agreement with Hynix, which again validates our strong intellectual property portfolio. In another important milestone for our flash technology, this week Dell announced the launch of notebook PCs that incorporate our 32-gigabyte Solid State Drive (SSD)."
"Looking forward, we project a pick-up in demand during the seasonally strong back half of the second quarter. However, excess supply and depressed pricing is expected to continue through the second quarter, possibly extending through the summer months, putting pressure on our margins. Our outlook is optimistic for renewed growth heading into the fourth quarter of 2007 and forward to 2008. This optimism is based on our expectation of continuing penetration into multimedia handsets, the steady stream of exciting new consumer product introductions such as the Sansa® Connect™, and the exceptionally attractive price points for our products now available to consumers."
Key Metrics and Highlights
SanDisk Corporation Chairman and Chief Executive Officer, Eli Harari, is scheduled to appear on CNBC's "Closing Bell with Maria Bartiromo," on April 26, 2006 at approximately 1:20 p.m. PDT. Judy Bruner, SanDisk's Executive Vice President, Administration and CFO, is scheduled to appear on Bloomberg TV's "Bloomberg On The Markets", April 27, 2007 beginning at approximately 8:39 a.m. PDT.
SanDisk's first quarter 2007 conference call is scheduled for 2:00 p.m. PDT, Thursday, April 26, 2007. The conference call will be webcast by CCBN and can be accessed live, and throughout the quarter, at SanDisk's website at www.sandisk.com/IR and at www.streetevents.com for registered streetevents.com users. To participate in the call via telephone, the dial-in number is (800) 238-9007. The dial-in password is 4311569. A copy of this press release will be furnished with the Securities and Exchange Commission on a current report on Form 8-K and will be posted to our website prior to the conference call.
A complete reconciliation between GAAP and non-GAAP information referred to in this release is provided in the attached tables.
This news release contains certain forward-looking statements, including statements about our business prospects and outlook, anticipated increased demand for our mobile OEM products, anticipated design-in for products, demand for certain new products in new markets, seasonally lower retail sales, a decline in margins due to prevailing challenging market pricing for flash memory, market supply and demand, cost reductions, expected technology transitions and the timing and cost benefits thereof, our planned investments in advanced technologies, products, markets and our brand, and scheduled appearances by our Chairman and CEO and our CFO that are based on our current expectations and involve numerous risks and uncertainties that may cause these forward-looking statements to be inaccurate and may significantly and adversely affect our business, financial condition and results of operations. Risks that may cause these forward-looking statements to be inaccurate include among others:
Future results may differ materially from those previously reported. We do not intend to update the information contained in this release.
SanDisk is the original inventor of flash storage cards and is the world's largest supplier of flash data storage card products using its patented, high-density flash memory and controller technology. SanDisk is headquartered in Milpitas, CA and has operations worldwide with more than half its sales outside the U.S.
SanDisk, the SanDisk logo, and Sansa are trademarks of SanDisk Corporation, registered in the United States and other countries. msystems is a trademark of msystems Ltd. Sansa Connect and Shaker are trademarks of SanDisk Corporation. SD, microSD and SDHC are trademarks. Other brand names mentioned herein are for identification purposes only and may be the trademarks of their respective holder(s).
Lori Barker Padon