Super Micro posted $60 billion in new orders last quarter - roughly five times its quarterly revenue run rate. The stock jumped more than 20% this week after the company also nearly doubled gross margin guidance to 15-17%, up from prior guidance of 8.2-8.4% for the same quarter. A deal to co-build a gigawatt-scale AI data center with SpaceX and xAI added fuel.
The problem is everything else. An SVP was indicted in March for allegedly smuggling $2.5 billion in restricted AI servers to China. Ernst & Young resigned as auditor in 2024, citing concerns about management’s integrity. The SEC has issued two subpoenas. The stock is still down 74% from its 2024 high despite this week’s rally.
Super Micro is the cheapest way to play AI infrastructure at ~9x forward earnings. It’s also the only AI stock where a board member faces up to 20 years in federal prison.
Here's how the community voted
AI data center spending is accelerating and Super Micro is at the center. Revenue grew 123% year-over-year in Q3, with full-year guidance near $40 billion. The $60 billion in Q4 orders represents roughly three times FY2025 annual revenue in forward visibility. SpaceX/xAI tapped Super Micro to co-build a gigawatt-scale data center in under a year.
Gross margins nearly doubled from 6.3% to a guided 15-17% in two quarters as the mix shifted toward liquid cooling and complete rack solutions. Management says it holds 70-80% of the liquid-cooled AI server market and was among the first to ship NVIDIA’s Blackwell GB200 and GB300 platforms.
At roughly 9x forward earnings and 0.5x sales, Super Micro is the cheapest AI infrastructure play by a wide margin. Dell trades at roughly 23x forward with slower revenue growth. Analysts have an average price target near $40, implying about 30% upside, and Needham raised its target to $46 after the order disclosure.
Super Micro was delisted for accounting violations in 2018 and nearly got delisted again in 2024 after Ernst & Young resigned as auditor, citing integrity concerns. The SEC has issued two subpoenas, the DOJ is investigating, and SVP Wally Liaw was indicted in March for smuggling $2.5 billion in restricted AI servers to China.
The $60 billion in orders include items that “may not constitute firm commitments” and “may be subject to cancellation.” Super Micro burned $7.56 billion in operating cash in nine months with $8.8 billion in debt against $1.3 billion in cash. It raised $10 billion in equity and convertible debt this year to fund a backlog that may not convert.
Dell’s AI server revenue grew 757% last quarter with a $51 billion backlog in the same range as Super Micro’s. NVIDIA is preparing to sell pre-assembled Vera Rubin compute trays directly, compressing the OEM role. And 63% of Q2 revenue came from a single unnamed customer.
AI data center spending is accelerating and Super Micro is at the center. Revenue grew 123% year-over-year in Q3, with full-year guidance near $40 billion. The $60 billion in Q4 orders represents roughly three times FY2025 annual revenue in forward visibility. SpaceX/xAI tapped Super Micro to co-build a gigawatt-scale data center in under a year.
Gross margins nearly doubled from 6.3% to a guided 15-17% in two quarters as the mix shifted toward liquid cooling and complete rack solutions. Management says it holds 70-80% of the liquid-cooled AI server market and was among the first to ship NVIDIA’s Blackwell GB200 and GB300 platforms.
At roughly 9x forward earnings and 0.5x sales, Super Micro is the cheapest AI infrastructure play by a wide margin. Dell trades at roughly 23x forward with slower revenue growth. Analysts have an average price target near $40, implying about 30% upside, and Needham raised its target to $46 after the order disclosure.
Super Micro was delisted for accounting violations in 2018 and nearly got delisted again in 2024 after Ernst & Young resigned as auditor, citing integrity concerns. The SEC has issued two subpoenas, the DOJ is investigating, and SVP Wally Liaw was indicted in March for smuggling $2.5 billion in restricted AI servers to China.
The $60 billion in orders include items that “may not constitute firm commitments” and “may be subject to cancellation.” Super Micro burned $7.56 billion in operating cash in nine months with $8.8 billion in debt against $1.3 billion in cash. It raised $10 billion in equity and convertible debt this year to fund a backlog that may not convert.
Dell’s AI server revenue grew 757% last quarter with a $51 billion backlog in the same range as Super Micro’s. NVIDIA is preparing to sell pre-assembled Vera Rubin compute trays directly, compressing the OEM role. And 63% of Q2 revenue came from a single unnamed customer.
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