After receiving a notification from Nasdaq regarding non-compliance with listing rules, Super Micro released its preliminary net sales, which fell short of Bloomberg's average estimates.
For the first quarter of fiscal 2025 (October 2024 to September 2025), which ended on September 30, the company expects net sales to range between US$5.9 billion and US$6.0 billion, down from the previous guidance of US$6.0 billion to US$7.0 billion. Super Micro anticipates a GAAP and non-GAAP gross margin of approximately 13.3%. GAAP diluted net income per share is projected to be between US$0.68 and US$0.70, revised from the prior guidance range of US$0.60 to US$0.77.
In an official statement, Super Micro reported that its special committee had completed an investigation based on concerns raised by EY. The investigation, which lasted three months and was led by independent legal counsel, found that the audit committee acted independently, and there was no evidence of fraud or misconduct by management or the board of directors. The committee recommended remedial measures to strengthen the company's internal governance and oversight functions, with a full report expected soon.
During the earnings call, Charles Liang, Super Micro's CEO, mentioned that the special committee had not provided additional details, and the company was awaiting the full report. He expressed confidence that the current challenges would not impact the company's ability to serve its customers, emphasizing its continued growth, particularly with the AI revolution.
Bloomberg Intelligence noted that Super Micro's disappointing first-quarter results and second-quarter outlook suggest the company may be struggling due to lingering accounting issues. The second-quarter forecast points to a sequential decline in sales, partly attributed to GPU availability.
While the company highlights its strong relationship with Nvidia, concerns about Blackwell GPU allocations remain, especially amid the accounting challenges and competitive pressures. The analyst report indicates that Super Micro's situation will likely remain fluid as it navigates a critical AI product cycle. Additionally, the company has yet to update the timing of its 10-K filing, which raises the risk of delisting, though it plans to request an extension from Nasdaq.
When questioned about Super Micro's performance, which came in at the lower end of guidance, and whether this was due to market share losses related to delayed financial filings, Liang clarified that the lower revenue was primarily due to customers waiting for the release of the new Blackwell chip.
The CEO explained that Blackwell is essential for their new solutions, including the "Black Whale Base Cooling Air Cooler" and "GP200." While Super Micro's production capacity, including liquid cooling solutions, is ready, the company is awaiting the chip's availability. He maintained that once the chip becomes available, market share and revenue growth will follow.
During the Q&A session, Liang addressed concerns regarding the company's gross margins and management changes. He explained that the company's margins fluctuate depending on customer mix and product generation, but the introduction of new GPU chips will provide an advantage for market share and profitability growth. He added that their data center solutions, including SECC and Micro Cloud Composer, will help further increase margins as the company expands.
Regarding organizational structure, Liang emphasized that Super Micro has experienced rapid growth, more than doubling in 2024 and continuing to expand. He confirmed that the company is evaluating additions to its senior management team, including the possibility of a special committee to support the company's fast-paced growth.
