SanDisk's push into speedier computer storage is paying off at a faster pace than Wall Street expected.
The stock surged 9.4 percent, the most since 2012, after the maker of flash-memory storage for phones, tablets and computers reported earnings Wednesday that topped analysts' estimates and gave a sales forecast that beat most projections.
First-quarter net income jumped 62 percent to $268.9 million, or $1.14 a share, exceeding the $1.08 average estimate, according to data compiled by Bloomberg. Revenue this quarter will be $1.55 billion to $1.63 billion, compared with an average estimate of $1.58 billion.
Under Chief Executive Officer Sanjay Mehrotra, Milpitas-based SanDisk is boosting earnings by selling more of its chips to makers of mobile devices and focusing on faster solid-state drives, which have a higher average price than memory sticks and cards. It's also selling more SSDs for use in servers.
Gross margin, or the percentage of sales remaining after deducting the cost of production, will be 47 percent to 49 percent this year, up from an earlier prediction of 45 percent to 48 percent, SanDisk said yesterday.
SanDisk rose $7.14 to $82.99 at the close in New York, extending its gain to 18 percent this year.