MILPITAS, Calif. ( TheStreet) -- Mention smartphones and tablets and companies like Apple ( AAPL) and Research In Motion ( RIMM) spring to mind, although the explosion in mobile data is also driving growth at Flash memory giant SanDisk ( SNDK). SanDisk shares have risen more than 33% this year, somewhat disproving the notion that storage is unsexy. Companies like Motorola ( MOT), Samsung, Apple and RIM use SanDisk Flash, making the storage maker a crucial ( if largely unseen) part of the mobile revolution.
And to think that SanDisk's mobile boost is a far cry from SanDisk's legacy business of providing Flash cards for products such as point-and-shoot cameras. "Sandisk can be described as best in class in the flash memory space due to its leadership in the flash card business," explained Tristan Gerra, senior analyst at Robert W. Baird, in an email to TheStreet. The analyst points to SanDisk's reputation for innovation, as illustrated with its revolutionary 3-bit per-cell manufacturing process, which essentially allows more information to be placed in a smaller place. Developed jointly by SanDisk and Toshiba, 3-bit per cell boosts the capacity of Flash memory while at the same time cutting production costs. SanDisk recently explained that 3-bit per cell is slashing its manufacturing costs by 40% and helped the company achieve its best-ever gross margin of 52% during the third quarter. "The company is very much a leader in innovation, being the first to come out with 3-bit per cell Flash," added Daniel Amir, senior research analyst at Lazard Capital Markets. "That gives them an advantage." This, in turn, is opening the door to new markets. "As the cost of NAND technology and NAND products continues to come down, there will be more opportunities for us," explained SanDisk CEO Eli Harari, during a recent briefing with journalists. Harari, who retires at the end of this year, sees future growth for the company in emerging markets such as India, citing the Indian government's efforts to build a $35 tablet for students.