SanDisk Reports Q3 Revenue of $751 Million; up 27% Year-Over-Year

SanDisk Reports Q3 Revenue of $751 Million; up 27% Year-Over-Year

SanDisk® Corporation (NASDAQ:SNDK), the world’s largest supplier of flash storage card products, today announced results for the third quarter ended October 1, 2006. Total third quarter revenue increased 27% on a year-over-year basis to a record $751 million. Third quarter net income as reported in accordance with U.S. Generally Accepted Accounting Principles (GAAP) was $103 million, or $0.51 per diluted share.

Excluding the impact of stock compensation expense and amortization of acquisition related intangible assets and the related tax effects, third quarter non-GAAP net income grew 15% to $124 million, or $0.61 per diluted share, which compares to the third quarter 2005 GAAP net income of $107 million, or $0.55 per diluted share.

“We are very pleased with our third quarter results,” said Eli Harari, chairman and chief executive officer of SanDisk Corporation. “Demand for our mobile products continued to be strong in the fast growing mobile phone market and we are pleased with our flash audio player U.S retail market share gains in the third quarter. Despite a challenging pricing environment in the third quarter we delivered non-GAAP operating margin of 21%, primarily due to our highly competitive product cost structure from our captive Flash business ventures in Japan. We expect to benefit in the fourth quarter from projected seasonally strong holiday sales of digital cameras, handsets, flash audio players, USB flash drives and gaming consoles and we now believe growth in our megabytes sold will be approximately 200% for 2006.”

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