Super Micro Computer (SMCI, Financial) reported its fiscal Q3 earnings, revealing a non-GAAP earnings per share of $0.31 and revenue of $4.6 billion, which fell short of market expectations. Analysts had already lowered their forecasts following the company's preliminary results last week. The company anticipates Q4 revenue to be between $5.6 billion and $6.4 billion, with non-GAAP EPS ranging from $0.4 to $0.5. Analysts, however, expected $6.59 billion in revenue and $0.64 EPS for Q4.
Investors are concerned due to the disappointing forecast and performance. Super Micro Computer attributed the underperformance to clients delaying purchases. CEO Charles Liang expressed confidence in achieving long-term goals but acknowledged short-term impacts from economic uncertainties and tariffs.
The company reported a 220 basis point drop in Q3 gross margin compared to the previous quarter, primarily due to increased inventory reserves for older products and costs associated with accelerating new product launches. Bloomberg Intelligence analyst Woo Jin Ho noted that customers might wait for SMCI products equipped with NVIDIA's new Blackwell chips, while macroeconomic issues could pressure short-term demand.
Previously, SMCI was favored in the market due to strong AI server demand, projecting $40 billion in revenue by fiscal 2026. However, the company faced delisting risks after failing to file its 2024 annual report on time, resolving the issue by February.
As of the latest update, SMCI shares fell 5.7% post-market.
