SanDisk Charges Past Estimates

Investors shrug off slumping profit.
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Sales jumped but earnings fell slightly at

SanDisk

(SNDK)

in its second quarter, thanks to development costs related to a new fabrication plant.

But investors applauded the results, which came in far above analysts' estimates. In recent after-hours trading, the company's stock was up $1.93, or 6.8%, to $30.15.

The flash-memory maker earned $70.5 million, or 37 cents a share in the quarter ended July 3, down from $70.6 million, or 38 cents a share, in the same period a year prior. The company's revenue, meanwhile, rose 18.8% to $514.9 million.

The company recorded $27 million in costs related to its Fab 3 plant in the quarter, which helped to boost its overall research and development costs to $61.4 million, or nearly double the year-earlier level.

Analysts had predicted that SanDisk would earn 32 cents a share on $500.9 million in sales, according to Thomson First Call.

The company did not immediately provide its outlook for the third quarter. Wall Street has forecast earnings of 32 cents a share in the current quarter on sales of $526.08 million.