Sandisk Corporation (NASDAQ:SNDK) had a good Thursday. Shares surged over 16% after the company laid out its growth strategy and long-term financial model at its 2026 Investor Day. The pitch? AI is going to make data centers a whole lot more storage-hungry, and Sandisk plans to be there to feed them.

The company's strategy centers on AI-driven storage demand, a more flexible NAND technology roadmap, and longer-term customer agreements. The goal is to make revenue, cash flow, and earnings more predictable. Because in the world of memory chips, predictability is a rare and valuable commodity.

Sandisk Targets Mid-To-High-Teens Revenue Growth

Here's the headline number: Sandisk expects revenue to grow at a mid-to-high-teens rate from fiscal 2028 through fiscal 2030, roughly in line with bit growth. That's the kind of growth that gets investors excited.

Under its long-term financial framework, the company is aiming for adjusted gross margins of about 80% and adjusted operating margins of about 75%. Operating expenses are expected to be around 5% of revenue. And adjusted free cash flow margins? Approximately 50% after taxes, capital expenditures, and working-capital requirements.

Chief Financial Officer Luis Visoso said the company plans to return 100% of excess cash to shareholders after funding investments in the business. That's a shareholder-friendly promise if there ever was one.

AI Inference Expands Storage Opportunity

So what's driving all this optimism? AI inference, for one. As token usage rises and KV cache requirements grow, data centers are becoming increasingly storage-intensive. Sandisk puts it this way: "The AI data center is expected to become dramatically more storage intensive, with the total available market for enterprise data center flash growing to 1.2 zettabytes by 2030."

That's a lot of zeros. And it's a big opportunity for a company that makes flash storage.

New NAND Strategy Targets Faster Product Development

Sandisk also introduced a two-dimensional scaling strategy built around its CMOS directly Bonded to Array technology. That's a mouthful, but the idea is to speed up product development. The company is also pushing its High Bandwidth Flash technology as a potential solution for AI inference workloads.

Long-Term Customer Deals Add Revenue Visibility

Perhaps the most interesting part is the shift toward what Sandisk calls New Business Model agreements. These contracts combine committed customer volumes, contractual protections, minimum financial guarantees, and structured pricing. In other words, Sandisk is locking in demand and reducing the volatility that has historically plagued the memory industry.

So far, the company has signed agreements with eight customers. Those customers account for about 50% of Sandisk's expected bits in fiscal 2027 and roughly two-thirds in fiscal 2028. That's a lot of visibility.

Price Action

At the time of publication on Thursday, Sandisk shares were up 16.34% at $1564.00, according to market data.