Companies like Sandisk and Micron generally have low valuations because they are cyclical. The recent pricing might indicate a shift in this trend. I've been thinking for a while that this cyclical nature might be breaking. Because these memory modules are vitally important with artificial intelligence, I've started looking at things differently. Remember how far Nvidia has come, starting as a company that only produced graphics cards for gaming PCs, thanks to artificial intelligence. The CEO said that all orders for this year are finished and they've already started taking orders for 2027. You might ask if Micron and Sandisk aren't competitors; the reason is, consider a robot. Micron enables the robot to speak and walk fluently, while Sandisk handles learning, such as recognizing the house and its owner.
Currently, the company's revenue is $8.9 billion, and in their latest financial statement, they increased their target for the next quarter by 50%. Although the 2026 expectation is $15 billion, there is no doubt that they will far exceed this.
Here are the reasons:
1- Humanoid Robots
By 2030, 10 million robots will be produced annually. Of these robots:
4.5 million will be warehouse robots
3.5 million will be economy robots
2 million will be premium robots
Sandisk's Market Share:
40% in warehouse robots
20% in economy robots
60% in premium robots
They will generate $2 billion in revenue just from the chips in the robot's body. In addition, with subscription revenue and other items, they are expected to generate $4 billion in turnover from robots.
2- Autonomous Vehicles
This is one of Sandisk's biggest revenue streams. The expected annual production in 2030 is around 76 million autonomous vehicles. Sandisk is expected to have a share of 25 million of these. Another area that sets Sandisk apart is that it primarily serves the L4 and L5 levels of autonomous vehicles, which are advanced autonomous vehicles like the Waymo Robotaxi. This translates to higher profits. Because L4 and L5 vehicles are not yet widespread, the potential for profit is enormous. It is expected that 3.8 million vehicles will be produced annually in these two levels alone by 2030. Currently generating $2 billion in revenue from autonomous vehicles, the company is expected to reach around $20 billion.
3- Data Center
The company's expected data center revenue this year is around $10 billion. The main reason for this is undoubtedly the increased price of SSD memory, currently ranging from $360 to $550. Memory prices will begin to fall in 2027 and 2028 with the opening of new production facilities. If SSD prices fall to the $120-150 range in 2030, this means the company will generate $30 billion in revenue from data centers with the construction of new facilities. It doesn't seem very likely that it will fall below the $120-150 range.
4- Other Revenues
The company also appears to be capable of generating $10 billion in revenue from EdgeAI, while VR and gaming are expected to generate around $5 billion. With these items, the company has a potential revenue of around $70 billion. Because of this long-term potential, I will add the company to my portfolio. If we are transitioning to intelligent systems where everything will be robotic, in a world where hardware is increasing, the story of companies like Sandisk may just be beginning. Given the continued memory shortage this year, my target price for the stock is between $1500-2000.
The information, comments and recommendations contained herein are not within the scope of investment consultancy. Investment consultancy services are provided within the framework of the investment consultancy agreement to be signed between brokerage firms, portfolio management companies, banks that do not accept deposits and customers. The comments in this article are only my personal comments and these comments may not be appropriate for your financial situation and risk return. For this reason, investments should not be made based on the information and comments in my articles.
