Not so good on the revenue line....
SanDisk Announces First Quarter Results
Thursday April 21, 4:05 pm ET
SUNNYVALE, Calif.--(BUSINESS WIRE)--April 21, 2005--SanDisk® Corporation (Nasdaq:SNDK - News)
Revenue of $451 million up 17% year-over-year
Net Income of $75 million up 17% year-over-year; EPS $0.39
Operating Margin of 25% driven by strong product gross margin
Successful 90-nanometer transition
SanDisk® Corporation (Nasdaq:SNDK - News), the world's largest supplier of flash storage card products, today announced results for the first quarter ended April 3, 2005. Total first quarter revenues increased 17% on a year-over-year basis to $451 million. First quarter net income was $75 million, up 17% compared to $64 million in the first quarter of 2004. Fully diluted earnings per share were $0.39, up 15% compared with $0.34 in the first quarter of 2004.
"The first quarter was another good quarter for SanDisk coming off of the strong fourth quarter holiday sales. We are particularly pleased with this quarter's profitability. Shipments from 90-nanometer chips increased to more than 80% of our first quarter's captive supply as 90-nanometer yields exceeded our expectations. Our product gross margins grew to 37%, driven by our increased 90-nanometer output and a modest 10% sequential decline in the average price per megabyte. Industry-wide supply for NAND memory is currently well balanced with growing demand from existing applications and new markets. Demand in the first quarter was exceptionally strong for our high capacity cards, and royalty revenues grew nicely reflecting the continuing growth of the NAND flash market for our licensees," said SanDisk CEO Eli Harari. "As we move forward in 2005, we believe SanDisk is well positioned to continue expanding into new markets such as the emerging market for our flash cards in handsets, the digital flash music player market and the exciting market for our cards in video game consoles such as the Sony PlayStation Portable."
Financial Results and Highlights
Product revenue grew 18% and royalty revenue grew 7% year-over-year.
Megabytes sold in the first quarter increased 189% year-over-year and were down approximately 13% from the seasonally strong fourth quarter of 2004.
Average density per card sold in retail was 411 megabytes, up 125% from the first quarter of 2004 and up 15% sequentially.
Average price per megabyte sold in the first quarter declined at a moderate pace of 10% sequentially and 59% from the first quarter of 2004.
Product gross margin in the first quarter increased 5 points both year-over-year and sequentially to a record 37.2%.
Operating income was $114 million and 25% of revenue compared to $99 million and 25% of revenue in the first quarter of 2004 and $126 million and 23% of revenue in the fourth quarter of 2004.
Cash flow from operations was $134 million compared to $76 million in the first quarter of 2004 and $12 million in the fourth quarter of 2004.
The SanDisk Sansa(TM) line of digital music players began shipping at the end of the first quarter. These players have embedded flash of 512 megabyte or 1 gigabyte capacities and they have a SD(TM) card slot for expandable storage.
Gaming cards began shipping in Memory Stick PRO Duo(TM) and SD formats to support new generation portable game consoles that now incorporate features such as digital audio, video playback and photo viewing. These features demand high capacity memory storage cards.
SanDisk Ultra® and SanDisk Extreme(TM) high performance product lines were among our fastest growing products year-over-year.
Retail presence almost doubled year-over-year to 114,000 storefronts. Most recent additions have been in mobile handset, convenience and gaming stores.
The new Flash Partners 300-millimeter Fab 3 began running initial test wafers in the first quarter and in February we announced the 8Gigabit chip that is being jointly developed with Toshiba on 70-nanometer technology.
Scheduled Interview
SanDisk Corporation Executive Vice President and Chief Operating Officer, Sanjay Mehrotra, is scheduled to appear on CNBC's "Wake-Up Call", April 22, 2005 at approximately 6:50 a.m. EDT. Judy Bruner, SanDisk's Executive Vice President, Administration and CFO is scheduled to appear on Bloomberg TV "Market Line", April 22, 2005 at approximately 1:45 p.m. EDT. |
