Supermicro Stock Surges as Company Avoids Nasdaq Delisting, Faces Challenges Ahead

Supermicro stock jumps 12%: Can it keep climbing?

Supermicro shares soared 12% on Wednesday after the server maker submitted its delayed financial reports just ahead of a deadline to avoid being delisted by the Nasdaq. This compliance confirmation eased investor concerns that the company might not meet the February 25 cutoff date. Despite facing a more than 40% decline in value over the past year due to accounting and corporate governance allegations, Supermicro's stock has surged 68% since the start of the year, buoyed by a positive revenue outlook driven by increased demand for AI infrastructure support. The company also expressed its commitment to resolving identified internal control weaknesses. Supermicro shares experienced upward movement on increasing volume after breaking out from a falling wedge pattern, though they encountered selling pressure above the 200-day moving average. Investors should monitor key price levels on Supermicro's chart, with resistance areas around $63, $75, and $96, while major support levels to watch include $48 and $38. On Tuesday, Supermicro's stock found support near the 50% Fibonacci retracement level, setting the stage for the subsequent surge. The stock closed Wednesday's session at approximately $51, although it was down 5% in after-hours trading. The first overhead area to observe is at $63, near the August countertrend peak and this month's high. A close above this level could push the shares to $75, where profit-taking may occur for those who purchased the stock at lower prices. Further buying might drive shares toward the $96 mark, an area previously marked by multiple peaks between February and July, just before reaching the stock's all-time high. For retracements, the $48 area serves as initial support, just above the 50% Fibonacci retracement level. A deeper pullback could bring the stock to revisit $38, which aligns with historical swing lows and previous price movement. While Supermicro successfully met its filing deadline, challenges remain. BDO, the company's new auditor, issued an "adverse opinion" regarding some internal controls, necessitating management to address "certain material weaknesses" in its internal processes as stated in its Form 10-K filing. Nevertheless, investor Michael Wiggins De Oliveira emphasized the growth potential of Supermicro, projecting revenues of $40 billion for Fiscal Year 2026. Wiggins De Oliveira noted the company's unique liquid-cooling technology and AI server customization as competitive advantages in the AI computing sector, recommending SMCI as a Buy based on the attractive valuation of 22x next year's free cash flow. Despite the bullish outlook, Wall Street analysts hold a more cautious stance. The consensus rating for SMCI stock is a Hold, with three Buy, two Hold, and two Sell ratings over the past three months. The average 12-month price target stands at $42.83, indicating approximately 16% downside potential. Following compliance with Nasdaq requirements, several analysts have adjusted their price targets for SMCI. Ananda Baruah from Loop Capital increased the target to $70 from $50, while maintaining a Buy rating, while Mike Ng from Goldman Sachs raised the target to $40 from $36 but reiterated a Hold rating. With up-to-date SEC filings and positive revenue projections, Supermicro appears to have a promising path ahead. However, the company must navigate ongoing accounting issues and intense competition within the AI and data center markets to realize its potential. Disclaimer: The content of this article is for informational purposes only and should not be construed as investment advice. We do not endorse any specific investment strategies or make recommendations regarding the purchase or sale of any securities.

Super Micro Computer Just Avoided Its Biggest Risk. Is the Stock Finally a Buy? | The Motley Fool

Super Micro Computer (SMCI 12.23%) has been through a difficult few months that started with questions about its financial reporting and peaked with a potential Nasdaq delisting. This resulted in the stock plummeting more than 67% from September through mid-November. All of this halted spectacular momentum that had pushed the stock to a nearly 800% gain in the previous three years. Supermicro was one of the early winners of the artificial intelligence (AI) boom as it makes servers and other equipment critical to the operations of AI data centers. AI customers flocked to the company for these products, which resulted in quarterly revenue last year surpassing the company's full-year revenue as recently as 2021. The company's stock was one of the hottest AI stocks before the headwinds picked up. In recent times, though, Supermicro has successfully addressed questions and regained the faith of some investors. Just this week, the company avoided its biggest risk -- a Nasdaq delisting -- by filing audited financial reports according to the Feb. 25 deadline set by the Nasdaq. These were reports that missed the usual filing schedule and put the company at risk for delisting. Does this move by Supermicro finally make this beaten-down stock a buy? First, here's a quick summary of the Supermicro story. The 30-year-old company surged to the forefront in recent years, due to demand from AI customers. These customers appreciated the company's ability to quickly tailor equipment with the latest chip innovations from partners like Nvidia to their needs. This resulted in soaring revenue and net income. But troubles arose in late August when Hindenburg Research published a short report alleging "glaring accounting red flags." The situation got worse when Supermicro said it would be late filing its 10-K annual report and its 10-Q quarterly report and the company's auditor resigned. A non-compliance letter from the Nasdaq further shook investor confidence as it indicated the unfiled financials could lead to a delisting. Since then, Supermicro has hired a new auditor, BDO, and agreed to file the tardy financial reports as of Feb. 25. Meanwhile, the company also cooperated with a review of its operations by an independent special committee, and this review found no evidence of wrongdoing or fraud. The committee mainly recommended Supermicro strengthen its executive team so that it could better support a growing company. This week, Supermicro filed the financial reports, without any restatements, according to the Nasdaq deadline. "The company has received correspondence from the Nasdaq staff that the company has regained compliance with the filing requirements, and the matter is now closed," Supermicro said. This is very positive news because a delisting could have resulted in the flight of many investors. For example, institutional investors generally hold stocks trading on major exchanges -- not stocks trading over the counter (OTC). And lower volume in OTC stocks means the stock would be more difficult to trade, as well. By remaining listed on the Nasdaq, the company scored a major victory. Investors also will appreciate that Supermicro didn't have to make changes to its financial reports from the earlier unaudited versions. This also is an important point. Does all of this make Supermicro a buy? It's true the company is in a much better position today than it was just a few months ago. Investors have more visibility regarding the financial picture, and the company's business continues to look promising, considering its growth so far and the fact that the AI infrastructure buildout is far from over. Analysts expect today's $200 billion AI market to reach beyond $1 trillion by 2030 -- so there's a lot more for strong AI companies to gain in the years to come. Supermicro still faces some challenges, though. In the recent 10-K filing, BDO said it had an "adverse opinion" of Supermicro's internal financial controls. In the report, Supermicro says it's reviewing its weaknesses and putting into place actions to improve. This includes further training sessions for accounting staff, upgrading IT systems, and hiring. All of this means that the answer to the question of whether the stock is a buy or not depends on your comfort with risk. Cautious investors should wait until the company advances further along on this path to recovery. For example, if you're in this category, you might wait until Supermicro assembles an executive team according to the independent committee's recommendations. You also may want to see another audited financial report or two and consider how the company is progressing. However, aggressive growth investors looking for a promising AI company might consider scooping up a few shares of Supermicro. If it strengthens its internal controls, as promised, it could soar from today's levels and may once again become one of the most sought-after AI stocks.

Loop Capital On Super Micro Computer (SMCI): "We're Raising Our PT For The Third Time In Five Weeks (To $70 From $50 From $40)"

This is not investment advice. The author has no position in any of the stocks mentioned. Wccftech.com has a disclosure and ethics policy. Loop Capital has been one of the most consistently bullish voices on the prospects of Super Micro Computer (NASDAQ: SMCI), a leading retailer of liquid-cooled AI racks. Yesterday, the global investment services firm won a resounding vindication for its unswerving bullish stance on SMCI, when the latter managed to avoid a stock delisting by filing its requisite annual report for FY 2024 just minutes ahead of a looming deadline from the Nasdaq exchange. Now, Loop Capital is out with a fresh investment note on Super Micro Computer, taking a well-deserved victory lap of sorts after the roller-coaster of the past few hours. To wit, Loop Capital analyst Ananda Baruah notes at the outset that he is again hiking his price target for SMCI shares: "We're raising our PT for the third time in five weeks (to $70 from $50 from $40) and reiterating our Buy rating ..." While explaining his rationale behind this third price target hike, Baruah notes that Super Micro Computer "remains an important company in an important space with both special situation catalysts (yesterday's announcement of becoming SEC filing current) and fundamental as GB200 & GB300 (Blackwell) ramp heading into summer and key customers get into full swing (Tier 2 CSPs)." Also, Baruah thinks that Super Micro Computer's two biggest customers (NVIDIA and CoreWeave) have "huge" plans for 2025 and that it is inevitable that SMCI will benefit. Of course, the retailer of servers and AI racks also maintains a close association with AMD. Meanwhile, as stated earlier, Super Micro Computer has now filed its annual report for the year that ended on the 30th of June, 2024, on the requisite Form 10-K. It has also filed its quarterly financial statements for the periods that ended on the 30th of September and the 31st of December on the given Form 10-Qs. As such, the company is now back in compliance with Nasdaq exchange's requirements for continued listing. As a refresher, Super Micro Computer delayed the filing of all financial statements in August 2024, when a damning report from Hindenburg Research alleged widespread accounting malfeasance, prompting SMCI to halt all financial filing activity with the SEC in a bid to conduct an extensive internal control audit. SMCI suffered another major blow in October when Ernst & Young, the firm's designated auditor, resigned, citing concerns around corporate governance and the independence of the board. Bear in mind that SMCI now expects to earn $40 billion in full-year revenue in FY 2026 vs. Wall Street's consensus estimate of just $29 billion. As per a tabulation by Goldman Sachs, Super Micro Computer currently has the ability to produce around 1,500 DLC AI server racks, with significant spare capacity for increased production. For instance, the company's Taiwan facility is currently sitting at 60 percent capacity utilization, while its American facility is at 55 percent utilization. What's more, Super Micro Computer's Malaysia factory has barely ramped-up, currently sitting at just 1 percent capacity utilization.

Super Micro Stock Soars On Nasdaq Compliance, But Can The Rally Hold? - Super Micro Computer (NASDAQ:SMCI)

Super Micro Computer Inc. SMCI just dodged a major bullet, and Wall Street is cheering. The artificial intelligence-focused server maker skyrocketed over 26% in premarket trading on Wednesday after announcing it had regained compliance with Nasdaq's filing requirements. But while the delisting threat is off the table, technical signals suggest the rally might not be smooth sailing. Chart created using Benzinga Pro SMCI Stock Moderately Bullish, But Selling Pressure Spells Caution SMCI's stock has been on a wild ride, up 51.55% year to date but dropping 22.64% over the past five days. While the current trend remains moderately bullish, selling pressure is creeping in, raising concerns about a potential bearish shift. Technically, the eight-day simple moving average of $50.28 and the 200-day simple moving average of $52.75 suggest resistance ahead, reinforcing the risk of a pullback. However, support remains strong, with the 20-day simple moving average at $41.88 and the 50-day simple moving average at $36.24, both flashing bullish signals. Meanwhile, the Moving Average Convergence Divergence (MACD) indicator of 5.80 leans bullish, but with a Relative Strength Index of 63.50, SMCI stock looks heated. Any movements closer to the 70 (overbought) mark could trigger a pullback. Dodging Nasdaq's Ax Super Micro submitted its long-delayed financial results for fiscal 2024 and the first half of fiscal 2025 to the U.S. Securities and Exchange Commission, securing the green light from Nasdaq. The company had been under pressure after losing its previous auditor, Ernst & Young, and uncovering weaknesses in internal controls. While the fresh audit from BDO confirmed the company's numbers, it also flagged governance issues -- something investors should not ignore. Related: SMCI Stock Pops Over 26% In Wednesday Pre-Market After Super Micro Computer Says It 'Regained Compliance' Despite the turbulence, Super Micro's business remains on fire. Fueled by surging demand for Nvidia Corp's NVDA graphics processing units, the company's sales more than doubled to $14.99 billion in fiscal 2024. Elon Musk's artificial intelligence venture, xAI, is among its high-profile customers. What's Next For SMCI Stock? With Nasdaq compliance secured, Super Micro has removed a key overhang, but questions remain about governance risks and potential litigation. SMCI stock's sharp premarket move shows investor relief, but whether it can sustain gains depends on market confidence in its long-term fundamentals. Traders should watch for a break above resistance levels to confirm continued bullish momentum -- or signs of selling pressure dragging the stock lower. Read Next: US Stocks Likely To Open Higher Ahead Of Nvidia Earnings: S&P 500's Four-Day Fall Was A 'Non-Event,' Says Expert Photo: Shutterstock SMCISuper Micro Computer Inc$54.8820.5%OverviewNVDANVIDIA Corp$129.842.53%Market News and Data brought to you by Benzinga APIs

Will Super Micro Computer Stock Surge After Feb. 25? | The Motley Fool

Super Micro Computer (SMCI -5.40%) is approaching a make-it-or-break-it moment. Last year, the tech company hit a stumbling block -- one that put its listing on the Nasdaq at risk -- and this crushed its stock performance. Supermicro, a top-performing stock in early 2024, saw its shares plummet more than 65% from September through mid-November. The problem? Supermicro faced questions about its financial reporting. Concerns started with a short report by Hindenburg Research alleging "glaring accounting red flags." And Supermicro's postponement of filing its audited annual and quarterly reports reinforced investors' worries. This late filing also pushed Supermicro into noncompliance with the Nasdaq, putting the stock at risk of delisting. In recent times, though, Supermicro has accelerated along the path to recovery. An independent special committee reviewed the company's financial reporting practices and found no evidence of wrongdoing. Supermicro also hired a new auditor and worked with the Nasdaq to establish a new filing date for the earnings reports to maintain its listing on the exchange. In fact, this filing deadline is Feb. 25. Will Supermicro stock surge after that date? Let's find out. So, first, let's take a quick look back at the Supermicro story so far. The company has been around for more than 30 years, but earnings truly took off with the artificial intelligence (AI) boom. That's because Supermicro makes the servers and full rack scale solutions critical to data center operations -- and AI customers have been flocking to the company for its products. Supermicro has been a popular choice due to its ability to speedily serve customers with equipment, including the latest innovations from chip designers like Nvidia and Advanced Micro Devices, and tailor that equipment specifically to the customer's needs. The company can do this for two reasons. First, it works hand-in-hand with chip giants to follow their innovations through development and immediately integrate them into its products. Second, Supermicro's building-blocks technology, with equipment sharing many common parts, makes customizing it relatively easy. This has resulted in significant revenue growth for Supermicro. The company now generates more quarterly than it did in a full year as recently as 2021. For example, Supermicro's preliminary report for the most recent quarter showed revenue topping $5 billion, while in full-year 2021, it reached $3.5 billion. Investors saw this momentum and hopped on board. In the first half of last year, the shares rose 188%, even surpassing the percentage gain of market star Nvidia. But the Hindenburg report halted this momentum. And the delay of Supermicro's audited earnings reports to the Securities and Exchange Commission further powered the negative sentiment surrounding the stock. Though since then, as mentioned briefly above, Supermicro has worked hard to turn this situation around, and the results have been positive. The company supported the independent review of its accounting practices, and the key results were: Now, let's consider the make-it-or-break-it moment ahead. Supermicro agreed to file its audited 10-K annual and 10-Q quarterly reports by Feb. 25, the date determined by the Nasdaq, so that the company may maintain its listing -- avoiding the big risk of a delisting. The tech player has repeatedly reaffirmed its ability to do this, including during its most recent business update on Feb. 11. Investors have been optimistic about Supermicro's actions so far and its potential to meet this goal. The stock has climbed more than 80% this year, but it hasn't recovered its losses since declines began. However, if Supermicro files its reports on time and continues to generate strong revenue growth, there's reason to be confident about further recovery and even gains down the road. After all, the stock today trades for about 21 times forward earnings estimates, a reasonable level, considering Supermicro's growth and strength in the AI market. But will Supermicro stock immediately surge after Feb. 25? If Supermicro meets the Nasdaq deadline and doesn't restate the previously reported financials, the stock could take off. Supermicro stock has been known to react strongly to both positive and negative news, so I wouldn't be surprised if the shares roared higher following such a major sign of progress. Any disappointment, though, clearly could crush stock performance. All this means that Feb. 25 should be a big day -- one that current and potential Supermicro investors should closely watch.

Is Super Micro Computer Stock a Buy, Sell, or Hold in 2025?

With its shares more than doubling year to date, Super Micro Computer (SMCI -5.40%) is bouncing back from the crisis caused by uncertainty about its accounting practices. But is this recovery a fluke or the start of a new bull run? Let's dig deeper to determine what 2025 might have in store for this artificial intelligence (AI) hardware company. A Silicon Valley server maker Founded in 1993, Super Micro Computer has long been one of Silicon Valley's most prominent makers of server and data center hardware. Nevertheless, the stock languished in relative obscurity, with shares practically flat from 2015 to 2021, until the emergence of ChatGPT in 2022 sparked an epic bull run to an all-time high of $119 in early 2024. Supermicro, as it's also known, helps turn graphics processing units (GPUs) created by chipmakers like Nvidia and Advanced Micro Devices into ready-to-use computer servers. It specializes in energy-efficient designs that could save clients money as they run and train AI algorithms. This middleman role allows the company to indirectly benefit from its partners' innovations in chip design and enjoy explosive operational growth. Accounting uncertainties scared investors Supermicro's bull run was already stalling by mid-2024, but the declines came to a head in August when famous short-seller Hindenburg Research released a scathing report accusing it of accounting manipulation, sanctions evasion, and other serious infractions. Shortly afterward, Supermicro delayed filing its annual report for the fiscal year 2024. And its former auditor Ernst & Young resigned, citing an unwillingness to be associated with its financial statements. Where there is smoke, there is often fire, and this was a lot of smoke. Furthermore, the company has a history of regulatory trouble. In 2020, the Securities and Exchange Commission fined it $17.5 million for accounting violations. In 2018, shares were delisted from the Nasdaq exchange due to a lapse in financial reporting. Investors feared the recent filing delay could cause Supermicro to be delisted again, which could hurt the stock price by making shares less liquid and scaring away more risk-averse institutional buyers. However, it looks increasingly likely that this won't be the case. Management believes it will be able to file its delayed financial reports by Feb. 25 and reiterates its claim that none of its prior filings will need restatement. This update is a huge positive sign for Supermicro because it suggests fears of an accounting scandal may be overblown, shifting attention back to the company's excellent operational momentum. Supermicro's business is booming According to a preliminary release, management expects fiscal second-quarter sales to have grown 54% year over year to between $5.6 billion and $5.7 billion as clients continue to buy its data-center liquid cooling systems and AI servers. This growth rate is impressive, but investors can expect it to accelerate this year as Supermicro's partner Nvidia continues rolling out its new Blackwell GPUs. This month, Supermicro confirmed that it had entered full production of servers using the Blackwell-based chips. This should be a significant tailwind as data center clients seek to stay relevant in the increasingly competitive generative AI market. While Supermicro is not necessarily out of the woods yet (regarding the accounting and legal uncertainty), its current valuation seems to price in potential challenges. With a forward price-to-earnings multiple of just 23, shares are cheaper than the Nasdaq average of 28 despite its healthy growth rate. I'm very optimistic about Supermicro, but some investors may want to wait for some of the uncertainties to die down before considering a position in the company.

Will Super Micro Computer Be the AI Comeback Stock of the Year? | The Motley Fool

Super Micro Computer (SMCI -5.40%), often called Supermicro, has taken investors on quite the roller-coaster ride since the start of 2024. Once the hottest stock on Wall Street, it now sits around 60% below its all-time high. This makes it look like a deep value play, as the stock price looks fairly cheap compared to some of its artificial intelligence (AI) peers. So, could Supermicro make a massive comeback this year? Let's dive in. Super Micro Computer makes hardware for computing servers, a vital part of the AI buildout. In this space, Supermicro competes with other players like Dell (DELL -1.91%) and IBM (IBM -1.23%). There really isn't a ton to differentiate each of the players in the field, as the components for these servers are fairly commoditized. However, Supermicro has a few advantages over some of its competitors. First is the flexibility Supermicro provides customers. Compared to its competition, Supermicro offers unparalleled customization, which is nice because clients may want to tailor their servers to run a specific size model or use them for a particular application. Additionally, Supermicro's DLC (direct liquid-cooled) technology gives its servers an advantage over traditional air-cooled servers. Supermicro claims that DLC technology provides 40% energy savings and 80% space savings. DLC servers do not need to allow for significant airflow across the computing hardware because water is cooling, so this makes a ton of sense on paper. Overall, Supermicro is a strong player in the server hardware sector and has established itself as a high-end option. However, the company has encountered a few speed bumps along the way. Part of what triggered Supermicro's stock decline was allegations from the now-dissolved short-seller Hindenburg Research. Hindenburg claimed that Supermicro was involved in accounting manipulation, which triggered a Department of Justice investigation. This crashed the stock. Further adding to the matter, Supermicro's accounting firm resigned because it wasn't willing to be associated with the results. However, a third-party auditor found no misconduct by the company, although it did recommend replacing the CFO (which Supermicro is doing). Supermicro has a new accounting firm but has yet to file its end-of-year 10-K form, which was due late in the summer of last year, or any other quarterly statements after that. So, Supermicro has yet to file three quarterly documents with the SEC, which is still concerning for many investors. Furthermore, Supermicro stated on its conference call for the second quarter of fiscal year 2025 (ended Dec. 31) that it would answer no questions regarding the filing status of any of these critical documents. However, the company expects it will be able to file these forms by Feb. 25, which is right around the corner. This clearly raises some questions, as investors want to know if what they have been told is legitimate. Right now, investors are relying on management updates (although official results are near). Still, these updates haven't been all that great. In its second quarter, Supermicro's revenue rose about 54% year over year, with revenue expected to be between $5.6 billion and $5.7 billion. While that sounds like impressive growth, those results came in on the low end of Q1 guidance, which projected between $5.5 billion and $6.1 billion in revenue. Furthermore, Supermicro continues to decrease its fiscal year 2025 revenue guidance. When it delivered its initial 2025 guidance, management called for sales between $26 billion and $30 billion. Now, it expects between $23.5 billion and $25 billion. Normally, news like this would sink a stock, but since Supermicro announced earnings on Feb. 11, the stock is up around 45%. So, is this stock still a buy? I'd say it all depends on your risk tolerance. There's still a lot going on with Supermicro's SEC filings being delayed, and falling revenue expectations aren't great. However, Supermicro is still growing rapidly to meet the incredible demand for server hardware. Additionally, the stock is still pretty cheap at 18 times forward earnings. However, as mentioned above, server hardware is a commoditized business, so Supermicro stock is unlikely to fetch a premium valuation like some of its big tech clients. As a result, I think I will stay away from Supermciro's stock, as success is far from a sure thing. There are other AI stocks that look far more promising and where success is much more probable, and I'd rather stick my investing dollars there than risk losing a chunk of my investment from knee-jerk reactions in the market caused by Super Micro Computer headlines.

Supermicro finally files long-delayed 10-K, avoids delisting

SMCI had to come up with long-delayed report - or lose its slot on NASDAQ again It only took five or so months, but Supermicro has managed to untangle its long-delayed 2024 annual report, which was in a shoddy enough state to set its previous accountants running for the hills and put the server maker at risk of being delisted from the NASDAQ again. Supermicro had delayed the release of its annual 10-K financial filing for the SEC, America's securities watchdog, in late August after discovering accounting issues. The delays came amid allegations of accounting misconduct by a former employee, and a scathing report by activist short-seller Hindenberg Research claiming to have found additional evidence of unscrupulous behavior. In December, an independent special committee formed by Supermicro's board ultimately found no evidence of corporate misconduct or fraud, but not before the accounting firm hired to review its reporting practices resigned. Supermicro later hired BDO USA to pick up the pieces. But while the board-appointed special committee may have cleared the server slinger of wrongdoing, Supermicro nonetheless parted ways with its now-former CFO David Weigand and sought to hire a chief compliance officer and a general counsel. Alongside its delinquent 10-K report for 2024, now finally submitted to the SEC and made publicly available, Supermicro also used the opportunity to catch up on 10-Q filings for the first and second quarters of its 2025 fiscal year, the three months to September 30 and December 31, 2024, respectively. "With these filings, all outstanding financial statements are now filed with no restatements of previously filed financial statements, and the company has regained compliance with the NASDAQ filing requirements," the hardware maker said in a statement Tuesday. The release of the 10-K saw the biz's share rocket more than 22 percent in after-hours trading on Tuesday -- as the Silicon Valley corporation narrowly averted delisting from the NASDAQ stock exchange for a second time as punishment for fumbling around with its spreadsheets. Supermicro had until February 25 to turn in its completed financial paperwork, and did so in the nick of time that day. As for the numbers, Supermicro reported an annual profit of $1.15 billion, up 80 percent year-on-year, from revenues which jumped 110 percent to just shy of $15 billion. Its gross margin clocked in at 13.8 percent, down from 18 percent. The biz's fiscal year covers the 12 months to June 30, 2024. This jump in sales unsurprisingly was driven by extreme demand for GPU-packed, AI-accelerating servers along with supporting equipment and accessories required to deploy these power hungry systems. Supermicro, we'll note, has benefited greatly from the AI boom, with it notably supplying a large quantity of systems used in xAI's 100,000 Nvidia H100 Colossus supercomputer. Looking back at Supermicro's earlier disclosures, we see its latest figures differ slightly from the preliminary numbers shared in August. Revenues reported in the 10-K filing are slightly higher at $14.99 billion versus $14.94 billion, while net income was slightly lower at $1.15 billion versus $1.2 billion. ®

Why Super Micro Computer Stock Is Sinking Today | The Motley Fool

Super Micro Computer (SMCI -5.61%) stock is seeing a significant pullback in Monday's trading. The server specialist's share price was down 3.8% as of 12:45 p.m. ET. At the same point in the day's trading, the S&P 500 was up 0.2% and the Nasdaq Composite was down 0.3%. The stock had been down as much as 10.4% earlier in trading. Supermicro stock is seeing a pullback in conjunction with bearish momentum for artificial intelligence (AI) stocks -- as investors appear to be feeling a bit jumpy ahead of Nvidia's earnings on Wednesday. Investors are also likely feeling the jitters due to a major update from Supermicro that's slated for tomorrow. Tech stocks are continuing a slide that started late in last week's trading as investors weigh macroeconomic risks and the significance of Nvidia's upcoming fourth-quarter report. The AI leader's performance in the period and forward guidance could trigger big movement for the stock market at large. Nvidia is the key bellwether for momentum in the AI space, and the stakes are high on the heels of the big volatility kicked off by the DeepSeek R-1 model in January. Supermicro also uses Nvidia's advanced graphics processing units (GPUs) as the foundational hardware in its rack servers, and its stock will likely make a move depending on the print in the AI hardware leader's Q4 report. Even with today's pullback, Supermicro stock is still up 76.5% across 2025's trading -- and investors are moving to take profits ahead of a huge moment for the company. The tech specialist is scheduled to submit its delayed 10-K filing to the Securities and Exchange Commission (SEC) by tomorrow -- and it could be a make or break event for the stock. Despite its recent rally, Supermicro's share price is down roughly 55% from the high it reached last year. The pullback largely stems from allegations of bad accounting practices and the company's delayed filing of its annual report for its 2024 fiscal year, which ended June 30. The company has also yet to submit audited filings for the first two quarters of its current fiscal year. But the delayed reports are now almost here, and it could mark this year's biggest moment for Supermicro stock. For better or worse, shares look poised for big moves this week.

Does Philippe Laffont Know Something That Wall Street Doesn't? The Billionaire Investor Is Piling Into an AI Stock-Split That Certain Analysts Recommend Selling. | The Motley Fool

While he may not enjoy the same name recognition as Warren Buffett, Philippe Laffont has an impressive track record. The multibillionaire investor grew up in France, attended the Massachusetts Institute of Technology, and is what the investing community refers to as a Tiger Cub -- someone who worked for Julian Robertson's Tiger Management hedge fund in the 1990s. Many Tiger Cubs went on to found hedge funds of their own and become billionaires. Laffont founded venture capital and hedge fund Coatue Management in 1999, and made early investments in some companies that have become serious online players, such as Snap, Spotify, and TikTok-owner ByteDance. Coatue's latest 13F filing with the Securities and Exchange Commission (SEC) shows it has been piling into an artificial intelligence (AI) stock-split stock that has been under intense scrutiny, and is on the sell list of some Wall Street analysts: Super Micro Computer (SMCI -7.95%). But here's the catch: Supermicro must formally file its audited annual financial statements with the SEC by today's deadline to avoid delisting from the Nasdaq stock exchange. So the question is: Does Laffont know something that the rest of Wall Street doesn't? As of the end of December, Coatue Management held more than 8.8 million shares of Super Micro Computer -- a stake amounting to nearly 1% of its nearly $27 billion equities portfolio. At the end of the third quarter, the fund's Supermicro position had made up less than 0.1% of the portfolio. It's been a wild and dramatic ride for Supermicro, which manufactures high-end servers for data centers, including some of the best hardware for supporting generative AI. Even after management conducted a 10-for-1 stock split at the beginning of October, Supermicro's market cap fell by nearly 27% during the fourth quarter. For those unaware of the unfolding drama, it all started last August when financial research firm and short-seller Hindenberg released a report on Supermicro. That report alleged that the tech company was engaging in accounting fraud, including behaviors similar to those that the Securities and Exchange Commission (SEC) charged it with in 2020. The company had previously inflated its revenues and underreported expenses. Among other things, Hindenberg (which has shut shop since) alleged that the tech company was up to its old tricks, and had rehired executives who had been involved in the prior scandal. Supermicro's CEO rebutted the Hindenburg report, saying it included "false or inaccurate statements" and "misleading presentations of information that we have previously shared publicly." However, Supermicro also delayed filing its annual report (that should have contained its audited financial statements for fiscal 2024 that ended on June 30) which it usually does by August, and was ultimately removed from the Nasdaq-100 index. Earlier this month, the company said it would be able to file its delayed quarterly and annual reports with the SEC by Feb. 25, which means today is the last day to file its annual financial results, as well as provide an update on the first two quarters of fiscal 2025, to remain listed. The company did report a preliminary earnings report for the second quarter of fiscal 2025 (that ended on Dec. 31, 2024) in the form of a current report, or 8-K filing. Following this report, the stock had an incredible run. While its adjusted earnings and revenue came in below expectations, management guided for $40 billion of revenue for fiscal 2026, way ahead of Wall Street analysts' consensus estimate. However, the latest update should be taken with a grain of salt since that's unlikely to be audited, and its credibility will depend on whether Supermicro files the audited statements for fiscal 2024. Not surprisingly, the last three trading sessions have seen the stock lose more than 14% of its value. The company also revealed that it had received subpoenas from the Department of Justice and the SEC in late 2024 seeking certain documents relating to Hindenberg's report. Street analysts are split on the matter. Seven research firms have issued reports on the company over the past three months, according to TipRanks. Three call the stock a buy, two call it a hold, and two say sell. The average analyst's 12-month price target, however, is more than 40% below where it was trading on Feb. 20. Many largely raised their price targets following the positive update earlier this month, saying they had more confidence that management would submit regulatory filings by Feb. 25. However, analysts from JPMorgan Chase maintained an underweight rating on the stock, saying they needed more proof that Supermicro can hit management's "aggressive" fiscal 2026 guidance. Buying Supermicro stock last year has paid off handsomely for Laffont and Coatue. The stock has more than doubled year to date. Today will be an important day for the company. If it does submit its delayed filings to the SEC, that could increase investors' confidence. It will be interesting to see if Coatue holds onto its position from here or takes its winnings. Supermicro definitely provides products that are important to the growing AI industry, so if management can avoid further issues with regulators, the stock should do well. However, much uncertainty remains, including its 2026 guidance. I imagine the stock could stay volatile, so I wouldn't jump too deep into the stock just yet. But if the company can provide evidence that its regulatory issues are behind it and that its 2026 guidance is achievable, those would be signs that it could be time to increase your position.

2 Popular AI Stocks to Sell Before They Drop 62% and 74%, According to Certain Wall Street Analysts | The Motley Fool

Palantir Technologies (PLTR -4.63%) and Super Micro Computer (SMCI -5.40%) are two of the most popular artificial intelligence (AI) stocks on the market. But certain Wall Street analysts have set the companies with target prices that imply substantial downside in the next year. Here's what investors should know about Palantir and Super Micro. Palantir develops data analytics software. Its platforms let customers integrate information, train machine learning (ML) models, and apply artificial intelligence (AI) to complex data to surface insights and improve decision-making. Palantir says its software is unique in its ability to operationalize AI, meaning it can move clients from prototype to product more quickly than alternative solutions. Analysts have mixed opinions. Forrester Research has ranked Palantir as leader in artificial intelligence and machine learnings platforms, awarding its AIP product higher scores than similar platforms from Alphabet, Amazon, and Microsoft. But consultancy Gartner has scored Palantir below a dozen other vendors for its data integration tools, and did not even mention the company in its latest report on data analytics. Palantir over the past year reported a series of increasingly impressive financial results. In the fourth quarter, customers increased 43% and the average existing customer spent 20% more. Both metrics accelerated from the prior quarter. In turn, revenue increased 36% to $828 million, the sixth straight acceleration, and non-GAAP net income soared 75% to $0.14 per diluted share Wall Street expects Palantir's adjusted earnings to increase at 31% annually through 2026. That makes the current valuation of 255 times adjusted earnings look absurdly expensive. Admittedly, Palantir topped the consensus estimate in the last six quarters, but the current valuation would be difficult to rationalize even if earnings grow twice as fast as analysts anticipate. Personally, I doubt Palantir shares will plunge 62% over the next year. But investors should be cautious about chasing the stock right now, and current shareholders should consider trimming their positions, especially if those positions represent a large percentage of their portfolios. Super Micro Computer manufactures servers and storage systems. The company prides itself on being first to market, often by a few months, when suppliers like Nvidia release new chips. Internal engineering expertise and a "building block" approach to product development make that possible. Those qualities have helped Super Micro secure a leadership position in the AI server market, according to Counterpoint Research. However, Susquehanna analyst Mehdi Hosseini says Super Micro lacks a proprietary advantage. He argues there is nothing unique about the company that will prevent larger competitors like Dell from eventually taking market share in AI servers. "Super Micro doesn't really do the innovation. They are a contract manufacturer with willingness to commit working capital," Hosseini told Barron's last year. The innovation is done upstream by chipmakers like Nvidia and manufacturers like Taiwan Semiconductor, and pricing power lies with the innovators. For instance, Nvidia can sell its chips to whichever server maker is willing to pay the most. It has no obligation to work with Super Micro. But Super Micro does have an incentive to purchase Nvidia GPUs because they are widely considered the best AI accelerators on the market. Super Micro has been under scrutiny since August, when short seller Hindenburg Research published details concerning "accounting red flags, evidence of undisclosed related party transactions, sanctions and export control failures." A special committee appointed by the Board found no evidence of wrongdoing, but Super Micro is still out of compliance with the SEC. The company has not published its Form 10-K for fiscal 2024, nor has it published its Forms 10-Q for the first two quarters of fiscal 2025. In other words, shareholders have not seen externally audited financial results for the better part of a year. Additionally, Super Micro recently cut its revenue outlook by 13% for fiscal 2025, though it did provide encouraging guidance for fiscal 2026. Here is the bottom line: I would avoid buying Super Micro stock until the regulatory issues have been resolved. And current shareholders should think about trimming large positions. Given the recent dearth of information, the stock could move sharply in either direction when Super Micro finally files its overdue annual and quarterly reports later this month.