Super Micro soars as blockbuster Q2 results restore faith in the AI server company
This positive reaction breaks a long streak in which death and taxes had been joined by “Super Micro falling any time the company delivers financials” as one of life’s certainties.
Super Micro Computer more than doubled its sales in Q2, and, perhaps more importantly, may have also doubled the trust that investors have in the company.
Shares are soaring in the wake of the AI server company’s quarterly report, with top- and bottom-line results exceeding estimates, as did guidance for the current quarter. Management also raised its full-year sales guidance to “at least” $40 billion, up from an outlook of $36 billion in November.
The story that management had been telling for the better part of the past year about customers waiting to order Blackwell racks, and then encountering some struggles in attempting to produce and deliver them, suddenly starts to look a little more reasonable — and like a corner has been turned for the business.
“The company’s data center building block solutions (DCBBS) is gaining momentum across key customers,” wrote Needham & Co. analyst Quinn Bolton. “Notably, DCBBS accounted for 4% of profit in F1H26, and management expects it to increase to a double-digit % by calendar year-end 2026.”
This positive reaction breaks a long streak in which death and taxes had been joined by “Super Micro falling any time the company delivers financials” as one of life’s certainties.
Consider:
November 5: Shares plummet 11.3% after Q2 net income-per-share guidance was weak, indicating mounting margin pressures.
October 23: The stock slumps 8.7% after pre-announcing Q1 sales of roughly $5 billion, which was far short of the consensus estimate for $6.5 billion.
August 6: SMCI sinks 18.3% after a Q4 sales and earnings miss, with CEO Charles Liang blaming the lackluster results on “a capital constraint that limited our ability to rapidly scale production.”
April 30: Shares tumble 11.5% after Super Micro releases preliminary Q3 sales that were below the consensus estimate and its own revenue guidance.
Super Micro has now proven it can get a lot of money in the door, but translating that to the bottom line will remain a challenge going forward.
“The Grace-Blackwell 300 GPU ramp-up is resulting in large-scale cluster-AI deals that can sustain quarterly deal activity of $10-$12 billion through the year,” wrote Bloomberg Intelligence senior technology analyst Woo Jin Ho. “Yet the company’s margin isn’t improving, and the EPS projection implies a sub-7% gross margin for 3Q and potentially the year.”
