Updated from Jan. 27SanDisk's ( SNDK) fourth-quarter earnings slipped slightly from a year ago despite a 41% increase in revenue, as a higher tax rate ate into the bottom line. Earnings were still well above estimates. The stock surged $3.44, or 15.5%, to $25.69 Friday morning. The flash storage company earned $78.3 million, or 42 cents a share, in the quarter, compared with $87.8 million, or 47 cents a share, last year. Revenue was $548.9 million in the 2004 fourth quarter compared with $389.3 million a year ago. Income in the latest quarter was taxed at 37%, compared with 20% last year. Analysts had been predicting earnings of 27 cents a share on revenue of $504.7 million in the most recent quarter, according to Thomson First Call. The latest quarter reflected "strong demand for our products in digital cameras, USB flash drives, mobile handsets and our new line of flash digital audio players," the company said, with total megabytes sold rising 110% from the third quarter. Operating margins improved by 3 percentage points even though the price per megabyte slide 34%.