Key Highlights
- Shares of SMCI declined 3.1% to reach $29.38 during Thursday’s session, caught in widespread AI and chip stock weakness
- Comments from Elon Musk about exclusive Nvidia chip usage triggered selling pressure throughout AI hardware stocks
- The company disclosed a massive backlog exceeding $60 billion while upgrading gross margin projections to 15%-17%
- Fourth-quarter results scheduled for August 11; analysts forecast $0.92 EPS (124% YoY growth) and $11.60 billion revenue
- Wall Street maintains a “Hold” consensus with a $38.40 average target, suggesting approximately 31% potential upside
Shares of Super Micro Computer experienced a 3.1% decline Thursday, settling at $29.38 amid widespread weakness affecting artificial intelligence and semiconductor equities.
Super Micro Computer, Inc., SMCI
The selloff followed remarks from Elon Musk indicating his companies would exclusively utilize Nvidia chips. This statement created shockwaves throughout the AI hardware sector, negatively impacting companies that either compete with or complement Nvidia within the data center ecosystem.
Thursday’s session saw approximately 26.4 million shares change hands, representing a 40% decrease from the typical daily volume of 43.6 million shares. The previous session had concluded at $30.32.
Over the trailing twelve months, SMCI has declined 37%, while remaining relatively unchanged on a year-to-date basis. The company currently commands a market capitalization of $17.67 billion.
The recent downturn also appears driven by profit-taking following a robust period of gains. Market participants are evaluating whether current share prices adequately reflect the company’s expansion prospects.
Fourth Quarter Results Expected August 11
Investor attention now shifts to August 11, when SMCI is scheduled to unveil its fiscal fourth-quarter financial performance.
Analyst consensus calls for earnings per share of $0.92, representing growth exceeding 124% compared to the prior year period. Revenue projections stand at $11.60 billion, indicating 101% year-over-year expansion.
During a preliminary announcement last month, SMCI disclosed an order backlog surpassing $60 billion. Additionally, the company elevated its gross margin forecast to a range of 15%-17%, significantly higher than the prior guidance of 8.2%-8.4%.
The company’s last reported quarter delivered EPS of $0.84, surpassing the $0.63 consensus estimate. Revenue reached $10.24 billion, marking 122.7% annual growth, although falling short of the $12.39 billion analyst projection.
Wall Street Ratings and Institutional Holdings
Notwithstanding the substantial backlog, analyst sentiment remains measured. The prevailing consensus stands at “Hold” with a mean price objective of $38.40, indicating roughly 31% upside potential from present levels.
Mizuho reduced its price target from $44 to $34 while maintaining a neutral stance in late July. Rosenblatt carries a $45 target alongside a buy recommendation. JPMorgan holds a $32 target with neutral positioning. Citigroup maintained its neutral rating with a $33 price objective.
Among analysts providing coverage on SMCI, four maintain Buy ratings, twelve recommend Hold, and two rate it Sell.
Regarding institutional ownership, Vanguard commands the largest position at 10.28%, narrowly exceeding CEO Charles Liang’s 10.26% stake. Institutional investors and hedge funds collectively control 84.06% of outstanding shares.
SMCI recently conducted its seventh annual Open Storage Summit, which brought together 38 industry specialists from 21 technology collaborators including AMD, Intel, IBM, and Western Digital. The conference emphasized AI inference capabilities and enterprise storage solutions, though it doesn’t represent a direct near-term revenue catalyst.
Technical indicators show the stock’s 50-day moving average positioned at $31.80, while the 200-day moving average stands at $30.48.
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