Back in 2010 the vast majority of flash memory was produced using 30nm-class manufacturing technologies, in 2011 makers of NAND flash will ramp up production using 20nm-class processes and will start to invest into research and development of 10nm-class fabrication processes.
"Our primary operating expense investments in 2011 will be in research and development, and we will include Fab 5 start up costs, as well as technology investment in [10nm-class] NAND and beyond," said Judy Bruner, chief financial officer of SanDisk Corp., during a conference call with financial analysts.
SanDisk notes that the demand towards flash memory is growing rapidly thanks to the increase of mobile devices' popularity. As a result, SanDisk, which co-operates NAND flash manufacturing capacity with Toshiba Corp. has to accelerate production of two-bits-per-cell and three-bits-per-cell types of multi-level-cell (MLC) flash memory.
Considering that thinner process technologies decrease costs per bit, it is logical for companies like SanDisk, Toshiba and Samsung to aggressively transit to new technology processes.
SanDisk's total fourth quarter (ended January 2, 2011) revenue of $1.33 billion increased 7% on a year-over-year basis and increased 8% on a sequential basis. Total revenue for fiscal 2010 of $4.83 billion increased 35% from $3.57 billion in fiscal 2009.
Fourth quarter net income, in accordance with U.S. Generally Accepted Accounting Principles (GAAP), was $485 million, or $2.01 per diluted share, compared to net income of $340 million, or $1.45 per diluted share, in the fourth quarter of fiscal 2009 and $322 million, or $1.34 per diluted share, in the third quarter of fiscal 2010. The GAAP net income for fiscal 2010 was $1.30 billion, or $5.44 per diluted share, compared to net income of $415 million, or $1.79 per diluted share, in fiscal 2009. The fourth quarter of fiscal 2010 includes a $203 million tax provision benefit related to the release of net deferred tax asset valuation allowances.