(Reuters) - SanDisk Corp SNDK.O raised its full-year revenue and gross margin forecasts, confident of a sustained rebound in the price of the flash memory chips it sells to Apple Inc (AAPL.O) and other manufacturers of smartphones and tablets.
Companies such as SanDisk and rival Micron Inc (MU.O) have benefited as prices of DRAM and NAND memory chips rebound from last year’s lows.
SanDisk said in April it expects higher prices for its NAND memory chips, which are used for general storage and data transfer in memory cards and solid-state drives.
The company on Wednesday raised its full-year revenue forecast to a range of $5.95 billion to $6.05 billion, from $5.60 billion to $5.75 billion. Wall Street was expecting earnings of $5.82 billion.
“The combination of stable prices and lower cost from the yen is having a stronger than expected impact on profitability and revenue growth,” RBC Capital Markets analyst Doug Freedman said.
A strong U.S. dollar has helped SanDisk purchase NAND wafers at cheaper rates through its partnerships with Japanese manufacturers.
The company raised its full-year adjusted gross margin forecast to above 45 percent from its earlier forecast of a range of 42 percent to 44 percent.
SanDisk shares were up 7 percent in post-market trading, after closing at $59.44 on the Nasdaq on Wednesday.
Revenue in the second quarter jumped 43 percent to $1.48 billion. Apple, a major buyer of NAND chips worldwide, accounted for 13 percent of SanDisk’s revenue last year.
RBC’s Freedman said SanDisk appears to be gaining market share as it reported better growth than its peers in the quarter.
Last month, Micron reported a 7 percent rise in quarterly revenue to $2.32 billion.
SanDisk’s net income rose to $262 million, or $1.06 per share, from $13 million, or 5 cents per share, a year earlier.
Excluding one-time items, earnings were $1.21 per share.
Analysts on average had expected a profit of 93 cents on revenue of $1.39 billion, according to Thomson Reuters I/B/E/S.
Reporting by Neha Alawadhi in Bangalore; Editing by Sriraj Kalluvila, Anthony Kurian