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To: Dealer who wrote (25981)	7/19/2000 6:52:56 PM
From: Dealer	Read Replies (1) \| Respond to of 35685

SNDK--Wednesday July 19, 4:16 pm Eastern Time Company Press Release SanDisk Announces Record Revenue, Royalties and Operating Income for Second Quarter 2000 SUNNYVALE, Calif.--(BUSINESS WIRE)--July 19, 2000--SanDisk Corporation (NASDAQ:SNDK - news), the world's largest supplier of flash memory data storage products, today announced record revenue for its quarter ended June 30, 2000. Total second quarter revenues were $143.9 million, an increase of 174% from the second quarter of 1999 due primarily to increased revenues from CompactFlash and MultiMediaCard products and higher license and royalty revenues. Product revenues were $122.6 million, an increase of 190% from $42.3 million for the same period last year. Revenues from licenses and royalties were $21.4 million, up 109% from $10.2 million in the second quarter of 1999. Net income for the quarter was $24.3 million, up 326% compared to $5.7 million in the same period last year. In the second quarter, diluted earnings per share were $0.33, compared to $0.10 per share in the second quarter of 1999. Total second quarter revenues increased sequentially by $34.6 million, or 32%, from total revenues of $109.4 million for the first quarter of 2000. Product revenues increased 26% and revenue from licenses and royalties grew 76%. Current quarter diluted earnings per share increased to $0.33 per share, up 57% compared to $0.21 per share (net the one-time gain related to the USIC merger) for the first quarter of 2000. ``The second quarter was an outstanding quarter for SanDisk with total revenues and operating income reaching record highs,'' said Dr. Eli Harari, President and CEO of SanDisk. ``Business conditions during the quarter continued very strong. We experienced record bookings and order backlog is at an all time high. Revenues in the first half of 2000 exceeded revenues for all of fiscal 1999, and operating income for the second quarter exceeded operating income for the entire year of 1999. Sales of our MultiMediaCards for use in MP3 players, digital camcorders and smart phones approached one million units, and total unit sales reached a record three million units for the quarter. Product gross margins improved from 30% in the previous quarter to 31%. We are pleased with the large increase in royalty revenues from our current licensees, which is indicative of the strong growth in the Flash memory card markets that we pioneered. ``Sales growth improved sequentially in all geographic regions of the world, particularly in North America and Europe. Retail and OEM sales were strong worldwide, continuing the trend started in the fourth quarter. ``Looking forward to the next several quarters, we expect our markets to remain supply constrained and the pricing environment for our products to remain benign. Our primary focus is to increase our shippable flash memory capacity in time for the upcoming holiday sales season through flash memory process shrinks and the qualification of additional fab capacity. During the third quarter, we expect to complete qualification and begin production shipments of our .24 micron 256Mbit D2 technology from three UMC fabs, including their newest fab 8F. We have also started first customer shipments of NAND Flash memory from Toshiba's Japanese fab. Toshiba is supplying us NAND wafers under the strategic agreement we concluded in the second quarter. We are optimistic about our prospects for further growth in revenues and profits in the second half of this year.'' SanDisk Corporation, the world's largest supplier of flash data storage products, designs, manufactures and markets industry-standard, solid-state data, digital imaging and audio storage products using its patented, high density flash memory and controller technology. SanDisk is based in Sunnyvale, Calif. SanDisk's second quarter 2000 conference call is scheduled for 2:00 p.m. PDT, Wednesday, July 19. The phone number is 973/633-1010. This news release contains forward looking statements including our expectations for future product revenues and bookings, average selling prices, gross margin and profits that are based on current expectations and involve risks and uncertainties that may affect our business, financial condition and results of operations. In addition to the factors discussed above, other risks include: the availability of adequate supply of flash memory wafers from UMC in Taiwan and from other sources; the availability of other critical materials and components; the timely and successful manufacturing ramp up of new product generations and new foundries with acceptable yields and manufacturing costs; the timely introduction and acceptance of new consumer products that incorporate our flash storage devices; future average selling price erosion due to excess capacity and price competition; the successful ramp up of assembly operations in China, Taiwan and the Philippines; seasonality of product sales; success in developing brand name preference and an efficient distribution system for SanDisk's products in the retail channel; economic conditions and exchange rates in Japan, the Pacific Rim and other geographic regions as they affect SanDisk's customers; the successful development and launch of our Secure Digital cards products; and the other risks detailed from time to time in our Securities and Exchange Commission filings and reports, including, but not limited to, the Form 10Q for the quarter ended March 31, 2000 and the Annual Report on Form 10-K for the year ended December 31, 1999. Future results may differ materially from those previously reported. We assume no obligation to update the information in this release. Note to Editors: SanDisk's web site/home page address: sandisk.com CompactFlash and CF are trademarks of SanDisk Corporation.