SanDisk Corp. (Nasdaq: SNDK) reported a lower quarterly profit late Thursday, but a higher gross margin projection sent the stock up nearly 4 percent in Friday trading.

Chief Financial Officer Judy Bruner said that San Disk's product gross margins for the third quarter should be between 17 percent and 21 percent. It represents an increase from the second quarter product gross margins of 16.2 percent.

Shares jumped $2.15, or 3.85 percent to $58.11 in Friday afternoon trading on the Nasdaq Stock Market.

The company earned $28 million, or 12 cents a share, compared to last year's $96 million, or 47 cents a share. Revenue rose 15% to $827 million from $719 million a year ago.

Excluding certain charges, SanDisk would have earned $72 million, or 30 cents a share. Analysts surveyed by Thomson Financial, who forecast a profit of 16 cents a share on $794 million in revenue.