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PENG vs. SNDK: Which AI Data Center Infrastructure Provider Is Better?
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Key Takeaways
SNDK's fiscal 2026 Datacenter revenues surged 437% to $5.15 billion as AI storage demand expanded.
SNDK has $93.9 billion in minimum contracted revenues from eight Datacenter and Edge customers.
PENG's AI-driven businesses grew 104% year over year and accounted for 74% of third-quarter revenues.
Penguin Solutions (PENG - Free Report) and Sandisk Corporation (SNDK - Free Report) are benefiting from rising investment in artificial intelligence (AI) data-center infrastructure, though they serve different parts of the technology stack. Penguin Solutions provides AI infrastructure, high-performance computing systems, memory solutions, software and services that help enterprises and neocloud providers deploy and manage complex AI environments. Sandisk, meanwhile, develops NAND flash storage and enterprise solid-state drives (SSDs) that support the growing storage requirements of data centers and AI workloads.
The two companies are worth comparing because both offer exposure to the accelerating buildout of AI infrastructure. Penguin Solutions benefits more directly from spending on AI compute systems, integrated infrastructure and related services, while Sandisk is positioned to capitalize on the surge in data creation and storage requirements stemming from increasingly data-intensive AI applications.
As enterprises, hyperscalers and neocloud providers continue expanding AI capacity, demand for both computing infrastructure and high-performance storage is expected to remain strong. Against this backdrop, which stock appears better positioned to capitalize on the next phase of AI data-center expansion — Penguin Solutions or Sandisk?
The Case for PENG Stock
Penguin Solutions is gaining exposure to rising AI data-center investment through its integrated memory and AI infrastructure businesses. The company’s full-stack AI Factory Platform combines ClusterWareAI software, MemoryAI and integrated memory, ComputeAI systems, OriginAI architectures and design, deployment and managed services. This positioning addresses growing infrastructure requirements as AI workloads move toward large-scale inference and agentic AI, where memory, networking and general-purpose compute increasingly complement GPUs. PENG is therefore positioned across multiple layers of the AI data-center stack. In the third quarter of fiscal 2026, AI-driven businesses accounted for 74% of total revenues and grew 104% year over year.
The opportunity is supported by expanding customer adoption. PENG added four AI infrastructure customers in the fiscal third quarter, while seven of the 13 customers added over the preceding four quarters expanded their business. The company also exited the quarter with a strong backlog, as AI-driven demand continued to outpace sales growth.
PENG’s MemoryAI portfolio further strengthens its AI infrastructure positioning by addressing memory bottlenecks in inference workloads. Its MemoryAI KV Cache Server is designed to improve inference performance, reduce latency and expand memory capacity beyond GPU HBM.
PENG’s latest results highlight accelerating business momentum. PENG reported record fiscal third-quarter revenues of $478.7 million, up 48% year over year, while non-GAAP operating income increased 67% to $64.4 million. Management raised fiscal 2026 revenue-growth guidance to approximately 22%, plus or minus 2%.
Despite the growth momentum, PENG faces several risks. Gross margin contracted to 27.8% from 29.3%, partly due to the ongoing Penguin Edge wind-down and sales mix. The transition toward a more diversified, non-hyperscale customer base could weigh on Advanced Computing, while supply constraints, extended lead times and shortages of AI components may affect deployment timelines. PENG also has debt obligations, although management expects available liquidity and operating cash flow to cover operations for at least the next 12 months.
The Case for SNDK Stock
Sandisk is increasingly positioned as an AI data-center infrastructure supplier, with NAND flash and enterprise SSDs becoming important to AI workloads. Management describes inference and agentic AI as increasingly storage-intensive, as AI-generated data must be stored, retrieved and served at low latency. Sandisk has scaled compute-focused TLC enterprise SSDs across hyperscalers and AI infrastructure customers, while its QLC Stargate platform targets high-capacity AI data lakes. Datacenter rose from 12% of bits in fourth-quarter fiscal 2025 to 38% in fourth-quarter fiscal 2026, while fiscal 2026 datacenter revenues surged 437% to $5.15 billion.
Another important growth driver is Sandisk’s technology portfolio. BiCS 8 reached the majority of bit production, supporting higher performance, density and power efficiency across TLC and QLC. The company also continues to expand its enterprise SSD portfolio, with PCIe Gen5 TLC drives progressing through hyperscaler qualifications and Stargate advancing with two major hyperscalers.
Sandisk also has eight Datacenter and Edge customers signed under New Business Models (NBMs), representing $93.9 billion of minimum contracted revenues at floor pricing and $59.8 billion of RPO at quarter-end, with weighted-average NBM duration exceeding four years. These agreements can provide greater demand visibility and reduce exposure to some traditional NAND cyclicality.
SNDK’s fourth-quarter fiscal 2026 revenues jumped 51% sequentially to $8.97 billion, while gross margin reached 84.6% and adjusted free cash flow was approximately $5 billion. Its fiscal 2026 revenues increased 175% to $20.25 billion, while Datacenter revenues surged 437%. Management guided first-quarter fiscal 2027 revenues to $10.3-$10.8 billion, with sequential growth expected from bit growth and higher pricing.
However, SNDK remains exposed to NAND cyclicality, pricing volatility, demand forecasting and AI infrastructure deployment delays. Its flash supply is concentrated through Flash Ventures, which is jointly operated with Kioxia and currently supplies all of Sandisk’s flash memory wafers. Moreover, alternative technologies could reduce storage requirements per unit of AI compute, potentially weakening NAND demand.
Earnings Estimates Comparison for PENG and SNDK
The earnings outlook gives SNDK an edge over PENG, supported by a significantly higher projected earnings growth rate and a positive revision trend.
The Zacks Consensus Estimate for PENG’s fiscal 2027 earnings is pegged at $3.40 per share, unchanged over the past 30 and 60 days, implying approximately 30.7% year-over-year growth.
Image Source: Zacks Investment Research
In contrast, SNDK’s fiscal 2027 earnings estimate stands at $213.31 per share, unchanged over the past 30 days but revised upward over the past 60 days. The estimate implies approximately 201% growth from fiscal 2026’s reported earnings, far outpacing PENG’s projected growth.
Image Source: Zacks Investment Research
PENG vs. SNDK: Stock Performance and Valuation
Year to date, SNDK stock has delivered a stellar 648.9% return, more than tripling the 187.4% gain posted by PENG. Sandisk’s massive outperformance is backed by strong AI-driven data center demand, rising adoption of its enterprise SSDs among hyperscale and AI infrastructure customers, favorable pricing and deeper customer partnerships. Its growing New Business Model agreements also provide greater visibility into future demand and revenues.
PENG vs. SNDK: YTD Price Return Performance
Image Source: Zacks Investment Research
Both Penguin Solutions and Sandisk’s shares are currently overvalued, as suggested by a Value Score of C. However, SNDK trades at a significantly lower forward 12-month P/E multiple of 8.1X, compared with 19.59X for PENG, suggesting that investors perceive SNDK’s earnings growth as relatively more stable and less risky.
PENG vs. SNDK: Forward 12-Month P/E Ratio
Image Source: Zacks Investment Research
The VGM scores further differentiate the two stocks. SNDK carries a VGM Score of A, while PENG has a VGM Score of D. Since the VGM Score combines Value, Growth and Momentum factors, SNDK’s higher score reflects a more favorable overall profile under Zacks’ methodology.
Conclusion
Both stocks offer exposure to the AI infrastructure boom, but SNDK currently presents the stronger investment case. Its robust earnings momentum, growing data-center business, strong customer visibility and more attractive valuation outweigh PENG’s broader AI infrastructure exposure, positioning Sandisk as the stronger choice at present.
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PENG vs. SNDK: Which AI Data Center Infrastructure Provider Is Better?
Key Takeaways
Penguin Solutions (PENG - Free Report) and Sandisk Corporation (SNDK - Free Report) are benefiting from rising investment in artificial intelligence (AI) data-center infrastructure, though they serve different parts of the technology stack. Penguin Solutions provides AI infrastructure, high-performance computing systems, memory solutions, software and services that help enterprises and neocloud providers deploy and manage complex AI environments. Sandisk, meanwhile, develops NAND flash storage and enterprise solid-state drives (SSDs) that support the growing storage requirements of data centers and AI workloads.
The two companies are worth comparing because both offer exposure to the accelerating buildout of AI infrastructure. Penguin Solutions benefits more directly from spending on AI compute systems, integrated infrastructure and related services, while Sandisk is positioned to capitalize on the surge in data creation and storage requirements stemming from increasingly data-intensive AI applications.
As enterprises, hyperscalers and neocloud providers continue expanding AI capacity, demand for both computing infrastructure and high-performance storage is expected to remain strong. Against this backdrop, which stock appears better positioned to capitalize on the next phase of AI data-center expansion — Penguin Solutions or Sandisk?
The Case for PENG Stock
Penguin Solutions is gaining exposure to rising AI data-center investment through its integrated memory and AI infrastructure businesses. The company’s full-stack AI Factory Platform combines ClusterWareAI software, MemoryAI and integrated memory, ComputeAI systems, OriginAI architectures and design, deployment and managed services. This positioning addresses growing infrastructure requirements as AI workloads move toward large-scale inference and agentic AI, where memory, networking and general-purpose compute increasingly complement GPUs. PENG is therefore positioned across multiple layers of the AI data-center stack. In the third quarter of fiscal 2026, AI-driven businesses accounted for 74% of total revenues and grew 104% year over year.
The opportunity is supported by expanding customer adoption. PENG added four AI infrastructure customers in the fiscal third quarter, while seven of the 13 customers added over the preceding four quarters expanded their business. The company also exited the quarter with a strong backlog, as AI-driven demand continued to outpace sales growth.
PENG’s MemoryAI portfolio further strengthens its AI infrastructure positioning by addressing memory bottlenecks in inference workloads. Its MemoryAI KV Cache Server is designed to improve inference performance, reduce latency and expand memory capacity beyond GPU HBM.
PENG’s latest results highlight accelerating business momentum. PENG reported record fiscal third-quarter revenues of $478.7 million, up 48% year over year, while non-GAAP operating income increased 67% to $64.4 million. Management raised fiscal 2026 revenue-growth guidance to approximately 22%, plus or minus 2%.
Despite the growth momentum, PENG faces several risks. Gross margin contracted to 27.8% from 29.3%, partly due to the ongoing Penguin Edge wind-down and sales mix. The transition toward a more diversified, non-hyperscale customer base could weigh on Advanced Computing, while supply constraints, extended lead times and shortages of AI components may affect deployment timelines. PENG also has debt obligations, although management expects available liquidity and operating cash flow to cover operations for at least the next 12 months.
The Case for SNDK Stock
Sandisk is increasingly positioned as an AI data-center infrastructure supplier, with NAND flash and enterprise SSDs becoming important to AI workloads. Management describes inference and agentic AI as increasingly storage-intensive, as AI-generated data must be stored, retrieved and served at low latency. Sandisk has scaled compute-focused TLC enterprise SSDs across hyperscalers and AI infrastructure customers, while its QLC Stargate platform targets high-capacity AI data lakes. Datacenter rose from 12% of bits in fourth-quarter fiscal 2025 to 38% in fourth-quarter fiscal 2026, while fiscal 2026 datacenter revenues surged 437% to $5.15 billion.
Another important growth driver is Sandisk’s technology portfolio. BiCS 8 reached the majority of bit production, supporting higher performance, density and power efficiency across TLC and QLC. The company also continues to expand its enterprise SSD portfolio, with PCIe Gen5 TLC drives progressing through hyperscaler qualifications and Stargate advancing with two major hyperscalers.
Sandisk also has eight Datacenter and Edge customers signed under New Business Models (NBMs), representing $93.9 billion of minimum contracted revenues at floor pricing and $59.8 billion of RPO at quarter-end, with weighted-average NBM duration exceeding four years. These agreements can provide greater demand visibility and reduce exposure to some traditional NAND cyclicality.
SNDK’s fourth-quarter fiscal 2026 revenues jumped 51% sequentially to $8.97 billion, while gross margin reached 84.6% and adjusted free cash flow was approximately $5 billion. Its fiscal 2026 revenues increased 175% to $20.25 billion, while Datacenter revenues surged 437%. Management guided first-quarter fiscal 2027 revenues to $10.3-$10.8 billion, with sequential growth expected from bit growth and higher pricing.
However, SNDK remains exposed to NAND cyclicality, pricing volatility, demand forecasting and AI infrastructure deployment delays. Its flash supply is concentrated through Flash Ventures, which is jointly operated with Kioxia and currently supplies all of Sandisk’s flash memory wafers. Moreover, alternative technologies could reduce storage requirements per unit of AI compute, potentially weakening NAND demand.
Earnings Estimates Comparison for PENG and SNDK
The earnings outlook gives SNDK an edge over PENG, supported by a significantly higher projected earnings growth rate and a positive revision trend.
The Zacks Consensus Estimate for PENG’s fiscal 2027 earnings is pegged at $3.40 per share, unchanged over the past 30 and 60 days, implying approximately 30.7% year-over-year growth.
Image Source: Zacks Investment Research
In contrast, SNDK’s fiscal 2027 earnings estimate stands at $213.31 per share, unchanged over the past 30 days but revised upward over the past 60 days. The estimate implies approximately 201% growth from fiscal 2026’s reported earnings, far outpacing PENG’s projected growth.
Image Source: Zacks Investment Research
PENG vs. SNDK: Stock Performance and Valuation
Year to date, SNDK stock has delivered a stellar 648.9% return, more than tripling the 187.4% gain posted by PENG. Sandisk’s massive outperformance is backed by strong AI-driven data center demand, rising adoption of its enterprise SSDs among hyperscale and AI infrastructure customers, favorable pricing and deeper customer partnerships. Its growing New Business Model agreements also provide greater visibility into future demand and revenues.
PENG vs. SNDK: YTD Price Return Performance
Image Source: Zacks Investment Research
Both Penguin Solutions and Sandisk’s shares are currently overvalued, as suggested by a Value Score of C. However, SNDK trades at a significantly lower forward 12-month P/E multiple of 8.1X, compared with 19.59X for PENG, suggesting that investors perceive SNDK’s earnings growth as relatively more stable and less risky.
PENG vs. SNDK: Forward 12-Month P/E Ratio
Image Source: Zacks Investment Research
The VGM scores further differentiate the two stocks. SNDK carries a VGM Score of A, while PENG has a VGM Score of D. Since the VGM Score combines Value, Growth and Momentum factors, SNDK’s higher score reflects a more favorable overall profile under Zacks’ methodology.
Conclusion
Both stocks offer exposure to the AI infrastructure boom, but SNDK currently presents the stronger investment case. Its robust earnings momentum, growing data-center business, strong customer visibility and more attractive valuation outweigh PENG’s broader AI infrastructure exposure, positioning Sandisk as the stronger choice at present.
PENG and SNDK currently carry a Zacks Rank #3 (Hold) each. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.