Asiya Merchant

Asiya Merchant inquired if the minimum $40 billion revenue guidance is constrained by component availability and supply issues, suggesting it could be higher if supply wasn't an issue. She also asked about the ramp of DCBBS across various geographies, given some regional revenue declines.

Answer

CEO Charles Liang confirmed that the $40 billion guidance already considers component supply growth, and revenue could exceed this if supply improves quickly. He noted that DCBBS is gaining global traction, with customers in almost every region appreciating its ability to simplify and speed up data center builds, making its impact global.

Asiya Merchant asked if component availability and supply constraints were limiting the $40 billion guidance and how DCBBS's ramp would impact various geographies given recent declines in some regions.

Answer

Charles Liang (CEO) confirmed the $40 billion guidance already accounts for component shortages, suggesting revenue could be higher if supply improves. He emphasized DCBBS's global appeal, attracting customers across all regions due to its 'one-stop shop' benefits for data center construction.

Asiya Merchant asked for SanDisk's perspective on the edge market (PCs, smartphones) and consumer market, specifically regarding customer demand signals through late 2026 and into 2027, given memory allocation and potential unit declines. She also inquired about SanDisk's outlook on true cycle gross margins in light of the structural changes in the NAND industry.

Answer

CEO David Goeckeler expressed satisfaction with the consumer portfolio's performance, noting over 50% year-over-year growth, driven by brand and innovation. He acknowledged potential base effects from unit declines in PC/smartphone markets but highlighted strong customer signals for supply. David emphasized the value of SanDisk's broad market presence and how AI deployments are fundamentally changing industry dynamics, leading to greater recognition of the company's IP and investment. CFO Luis Visoso stated that 35% gross margin is not the target for a high CapEx/R&D industry. He noted the current quarter's 51% gross margin and the 66% guidance for Q3 indicate progress towards justifying R&D and capital investments, aiming for structurally higher margins.

Asiya Merchant asked about SanDisk's outlook for the edge market (PCs, smartphones) and consumer market, considering memory allocation and potential unit declines, and how customer signals are shaping the demand outlook through late 2026 and into 2027. She also asked Luis Visoso about his perspective on true cycle gross margins given the current structural dynamics.

Answer

David Goeckeler (Chairman and CEO) expressed satisfaction with the consumer portfolio, noting over 50% year-over-year growth driven by branding and innovation. For edge markets, he acknowledged potential unit declines in 2026 due to base effects but highlighted strong customer demand signals and natural market dynamics of configuration changes with pricing. He emphasized SanDisk's broad market presence and the transformative impact of AI deployments making data center the largest NAND market, validating past R&D and capital investments. Luis Visoso (EVP and CFO) stated that 35% gross margin is not the target for a high CapEx/R&D industry, highlighting the current 51% and next quarter's 66% guidance as progress towards justifying investments and indicating a structurally higher margin expectation.

Asiya Merchant asked about the CapEx outlook for 2026, given the strong order book momentum and AI growth, and how Amphenol plans its investments.

Answer

Craig Lampo (CFO) stated that 2025 CapEx was slightly over 4% of sales, at the upper end of their historic 3-4% range. He expects 2026 CapEx to remain in that 3-4% range, likely towards the upper end, reflecting the organization's discipline in supporting significant growth with reasonable spending.

Asiya Merchant followed up on Amphenol's CapEx outlook and investment plans for 2026, given the strong order book momentum and AI growth.

Answer

CFO Craig Lampo noted that 2025 CapEx was slightly above the historic 3-4% range, ending just over 4%. He expects 2026 CapEx to remain within the 3-4% range, likely towards the upper end (around 4%), reflecting disciplined spending despite significant growth opportunities and strong orders.