Super Micro, a major player in the server manufacturing sector, reported unaudited quarterly financials on Tuesday, missing revenue expectations and issuing a weaker-than-anticipated forecast.
Super Micro is at risk of being delisted from the Nasdaq stock exchange if it does not file its annual report by mid-November.
The company’s stock fell by 17% in extended trading, heightening concerns about its governance and transparency.
In recent months, Super Micro has come under fire following allegations by an activist investor that it engaged in accounting irregularities and potentially violated export controls by shipping sensitive technology to sanctioned nations.
Despite the company’s reassurances that a special board committee found no evidence of fraud, the inability to provide audited annual results has unnerved investors and analysts alike.
Revenue falls short of expectations, impacted by Nvidia chip shortages
Super Micro reported revenue of $5.9 billion to $6 billion for the quarter ending Sept. 30, below the $6.45 billion experts had anticipated.
The figures represented a substantial 181% year-over-year increase, driven primarily by demand for its AI-optimised servers equipped with Nvidia processors.
Yet, Nvidia’s latest Blackwell GPU release has faced distribution delays, and Super Micro’s CEO Charles Liang highlighted ongoing challenges in securing sufficient chip supplies to meet demand.
Q4 forecast trails expectations, continues to weigh on market sentiment
For the upcoming December quarter, Super Micro provided revenue guidance of $5.5 billion to $6.1 billion, trailing the market’s expectation of $6.86 billion.
The company projects adjusted earnings per share (EPS) between 56 and 65 cents, significantly below the 83-cent consensus forecast.
Investors have shown concern about the company’s growth trajectory, as uncertainties regarding financial oversight continue to impact its valuation.
The departure of EY as Super Micro’s auditor last week signalled potential governance issues, prompting the board to establish a special committee tasked with investigating the firm’s financial oversight practices.
After a three-month review, the committee concluded there was no evidence of fraud but recommended a series of governance enhancements.
This report is expected to be finalised within days, potentially offering insights into the firm’s next steps to restore investor confidence.
CEO Charles Liang stated that Super Micro is urgently working to address its delayed reporting, aiming to retain its Nasdaq listing.
In the meantime, the company is actively seeking a new auditing firm to resolve its compliance issues.
Super Micro’s share price, which reached a high of $118.81 in March following its inclusion in the S&P 500, has since plummeted by nearly 80%, erasing over $55 billion in market capitalisation.
The recent developments highlight Super Micro’s struggle to balance rapid growth with effective regulatory compliance and transparent governance practices.
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