DGLY

Super Micro Computer's disappointing financial report raises concerns about its ability to profit from the AI wave.

On November 4th, after the U.S. stock market closed, Super Micro Computer released a disappointing first-quarter report for fiscal year 2026, with revenue of $5 billion, which not only decreased by 15% year-on-year but also fell by 14% quarter-on-quarter, which is quite unusual for a company in the AI server boom. The specific performance is as follows:

Financial Performance:

• Q1 fiscal year 2026 revenue of $5 billion, down 15% year-on-year and down 14% quarter-on-quarter;

• Gross margin plummeted to 9.3%, compared to 13.1% in the same period last year, and continued to decline from 9.5% quarter-on-quarter;

• Net profit of $168 million, a year-on-year drop of 60%, with non-GAAP earnings per share of $0.35, compared to $0.73 in the same period last year;

• Operating cash flow was negative $918 million, cash reserves of $4.2 billion, and liabilities of $4.8 billion.

Core Business Progress:

• Secured over $13 billion in Blackwell Ultra orders, with backlogged orders rapidly expanding;

• Transitioning to AI and data center infrastructure companies through DCBBS (Data Center Building Block Solutions);

• Advancing leadership in the fields of DLC (Direct Liquid Cooling) and AI technology.

Performance Guidance:

• Maintaining a full-year revenue target of at least $36 billion;

• For Q2 of fiscal year 2026, expected revenue of $10-11 billion, doubling quarter-on-quarter;

• Q2 expected GAAP earnings per share of $0.37-0.45, non-GAAP earnings per share of $0.46-0.54.

Affected by this news, the stock fell more than 10% in after-hours trading, although it has risen 56% year-to-date.

(Super Micro Computer's stock fell more than 10% after the earnings report)