SanDisk posted a higher third-quarter profit on strong sales of its flash memory storage products, but fell short of  expectations.

Quarterly income rose to $54.1 million, or 29 cents per share, from $14.8 million, or 9 cents, in the prior-year period, missing estimates of 34 cents from analysts surveyed by Thomson First Call.

Total revenue grew 45 percent to $408 million from $281.4 million last year, with product sales up 41 percent to $365 million and license fees and royalties nearly doubling to $42.9 million. SanDisk's gross margin, however, slipped to 36 percent of revenue from 40 percent the year before.

SanDisk said the industry-wide supply of flash memory products exceeded demand over the summer, causing a greater-than-expected decline in average prices and sending third-quarter revenue down 6 percent sequentially.

The company added that it is optimistic about global demand for its memory cards. Analysts estimate SanDisk's earnings at 41 cents per share on sales of $529 million for the fourth quarter.

By: DocMemory
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