Super Micro Computer stock bleeds 24% after it can’t even say when it will post actual earnings

Vinamrata Chaturvedi
·2-min read
Illustration: SOPA Images (Getty Images)
Illustration: SOPA Images (Getty Images)

Super Micro Computer Inc. (SMCI) shares plummeted more than 24% on Wednesday after the AI hardware company released a disappointing preliminary first-quarter report and failed to confirm a timeline for its actual first-quarter results. The San Jose-based company, which missed the deadline for filing its annual report, is also facing a potential Nasdaq delisting.

The company reported unaudited quarterly results on Tuesday after the market closed, leading to the sharp sell-off. This development follows the recent resignation of its auditor, Ernst & Young, which departed last week, citing disagreements over Super Micro Computer’s governance practices and board independence.

On Wednesday, the stock was trading near $21, marking a fresh 52-week low. Compared to its March peak of $123, the price has plunged over 82%, erasing over $55 billion in value.

For the quarter ending September 30, Super Micro reported net sales between $5.9 billion and $6 billion, falling short of analyst expectations, which had forecasted $6.45 billion. The company’s forecast for the December quarter also fell short of expectations, and it projected revenue between $5.5 billion and $6.1 billion, which was below the consensus estimate of analysts of $6.86 billion. Additionally, Super Micro expects adjusted earnings per share (EPS) to range from 56 cents to 65 cents, while analysts had anticipated EPS of 83 cents.

Super Micro is looking for a new auditor

On Tuesday, the company made no mention of Ernst & Young’s departure or any ongoing corporate governance concerns. However, CEO Charles Liang did confirm that Super Micro is actively working to hire a new auditor. It’s important to note that the company has not reported audited financial results since May.

Moreover, the company is facing potential delisting from the Nasdaq. After receiving a non-compliance letter in September, Super Micro has until November 16 to submit a plan to Nasdaq to regain compliance, or it could face delisting for the second time in five years.

Super Micro has close ties to Nvidia

The company makes hardware that supports AI applications, thrived this year due to the high demand for AI, and entered the Fortune 500 at No. 498. As a key partner and reseller of Nvidia’s (NVDA) GPUs and other components, Super Micro integrates its technology into its servers to support AI workloads.

Super Micro CEO Charles Liang and Nvidia CEO Jensen Huang are both Taiwanese immigrants and have a long-standing relationship. CEO Liang said on Tuesday that the company is working closely with Nvidia and that the demand is strong.

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