SanDisk Corporation detailed its transition to a recurring revenue model following a JPMorgan conference appearance. The company secured five multi-year supply contracts under its New Business Model. These agreements establish a minimum $42 billion revenue backlog.
The contracts include $11 billion in financial guarantees. SanDisk locked in pricing for over one-third of its fiscal 2027 capacity. This strategy aims to counter historical volatility in the NAND market.
SNDK shares surged 10.75% on May 21 to close at $1,542.24. Citi raised its price target for the stock to $2,025 following the presentation. The stock fell 4.12% on May 22 to close at $1,478.69. This pullback resulted from broader sector profit-taking.