Charles Liang, CEO of Super Micro Computer Inc., during the Computex conference in Taipei, Taiwan, on June 5, 2024.
Annabelle Cheh | Bloomberg | Getty Images
Super microThe embattled server maker, which was late in issuing annual financial statements and is at risk of being delisted by the Nasdaq, reported unaudited quarterly results on Tuesday.
The stock fell 17% in extended trading after the company's revenue lagged estimates, guidance came in weaker than expected and Super Micro said it doesn't know when it will report annual results for its most recent fiscal year.
Shares of Super Micro fell last week after the resignation of Ernst & Young, the company's auditor. The company faces accusations from an activist of committing accounting violations, and of having shipped sensitive chips to countries and companies subject to sanctions, in violation of export controls.
In a call with analysts on Tuesday, the company said it would not discuss any questions related to Ernst & Young's decision to resign and did not address corporate governance issues. Super Micro is actively working to appoint a new auditor, CEO Charles Liang said.
Super Micro faces the possibility of being delisted from the Nasdaq if it does not file its annual report with the Securities and Exchange Commission by mid-November. The company has not announced audited results since May.
“We are working urgently to once again become up-to-date with our financial reports,” Liang said on the call.
For the quarter ended Sept. 30, Super Micro said it had net sales between $5.9 billion and $6 billion. That's lower than analysts' expectations of $6.45 billion, but still up 181% year over year. The company's business has been booming lately as it ships full servers Nvidia Artificial intelligence processors.
Analysts wondered if sales would increase if the problems were resolved or if Super Micro planned to add senior management to improve its financial reporting. Liang instead discussed Nvidia's latest GPU, called the Blackwell, which has only begun shipping in recent weeks, and said demand is strong.
When asked by an analyst when Blackwell's revenue might show up in Super Micro's financials, Liang said “we ask Nvidia every day” and that the two companies continue to work closely together.
“Our capacity is ready, but there are not enough new chips,” Liang said.
Analysts wondered whether the company's plans to build Blackwell-based servers had changed, which could indicate that other server makers might get additional capacity or allocations to GPUs from Nvidia at the expense of Super Micro.
“To clarify one of the previous comments regarding Nvidia, we have the deepest relationships with Nvidia,” CFO David Wiegand said. “We now have several cutting-edge projects underway and we have spoken to Nvidia and they have confirmed that they have not made any changes to the customizations. We maintain a strong relationship with them, and do not expect that to change.”
Adjusted net income for the quarter was 75 cents to 76 cents per share, in line with analyst expectations compiled by LSEG.
Super Micro's forecast for the December quarter was also below estimates. The company said revenue would be between $5.5 billion and $6.1 billion, missing analysts' average estimate of $6.86 billion, according to LSEG. Adjusted earnings per share will be 56 cents to 65 cents. Analysts were looking for earnings per share of 83 cents.
SuperMicro said on Tuesday that its board of directors had appointed a special committee to look into Ernst & Young's concerns. The company said that after a three-month investigation, the committee found that there was “no evidence of fraud or misconduct” from management.
Super Micro said: “The committee recommends a series of remedial measures for the company to strengthen its management and internal control functions, and the committee expects to submit the full report on the work completed this week or next week,” adding that it intends to take all steps to maintain its listing on the Nasdaq Stock Exchange.
Shares of Super Micro rose 246% last year after jumping 87% in 2023. The stock peaked at $118.81 in March, shortly after it was added to the S&P 500 index.
The company has since lost nearly 80% of its value, wiping out more than $55 billion in market value.
