Flash memory-maker Sandisk (ticker: SNDK) reported very strong 3Q05 earnings yesterday - income was up almost 100% from 3Q04 and came in well above analyst estimates. Key data points and quotes from the SNDK conference call:
Earnings: $107.5 million (55 cents per share) Revenue: $589.6 million (up 45% year-over-year and 15% sequentially) Gross margins: 44% (up from 36% in 3Q04) ASP per megabite: down 5% (previously projected down 15-20%)
In the conference call, CEO Eli Harari commented on the mobile phone growth market and SNDK handset partnerships:
In 2007, mobile phones may eclipse both digital cameras and MP3 players in their usage of flash storage… On the horizon, we begin to see flash in video applications, and in a few years, we expect to see flash used extensively in hybrid combinations of flash memory and disk drives in notebook PCs.
In the third quarter Sony Ericsson launched a Walkman phone with a 512 Megabyte Memory Stick PRO Duo card supplied by us. Motorola introduced the iPod ROKR phone with a 512 Megabyte microSD bundle card supplied by us. Nokia announced their music-centric phone that will use, for the first time, a microSD card. And Samsung Mobile announced a support for our TrustedFlash cards in many of their content-centric handsets. Nine out of the top-10 handset OEMs have announced, or are expected to soon announce, models that support the microSD card, which is a TransFlash that we introduced and which is rapidly being adopted as the new de facto standard for removable cards in handsets.
Music is turning out to be the major trend in new mid- to high-end mobile phone, fueling the use of higher capacity cards.
(Quotes are from the CCBN StreetEvents transcript.)