Super Micro slumps as weak guidance and uncertainty over its annual report fuel investor fears

Nov 6 (Reuters) – Super Micro Computer (SMCI.O) sharesopens new tab slumped more than 24% on Wednesday, nearly hitting an 18-month low, as an unclear annual report schedule and weak quarterly forecasts fueled investor concerns about the AI server maker.

The company's auditor, Ernst & Young, unexpectedly resigned last week after previously raising concerns about its financial reporting. Super Micro said Tuesday an investigation by a special committee of its board found no evidence of fraud or wrongdoing.

“The actions of the previous auditor and the special committee are at odds with each other, adding to the confusion about current developments and, if anything, contributing to greater transparency,” JPMorgan analysts said in a note.

In late August, Super Micro also delayed filing its annual report, citing the need to evaluate “its internal controls over financial reporting.”

The Rise and Fall of Super Micro. Filing delays, a short seller report and an abrupt auditor exit are hurting AI Darling shares.

This came a day after short seller Hindenburg Research said it had taken a short position in the stock and alleged “accounting manipulation” at the company.

Super Micro risks delisting from Nasdaq if it fails to meet deadlines later this month.

If current losses continue, the company is expected to lose over $4 billion in market value.

The company on Tuesday also forecast second-quarter sales and profit that fell short of Wall Street expectations as it awaits the latest chips from Nvidia (NVDA.O).opens new tab be delivered.

Super Micro shares have been choppy since peaking in March due to a boom in generative artificial intelligence technology, which has boosted demand for AI-powered servers and hardware to process large amounts of data.

The stock is down about 2% this year after rising more than 240% last year.

Super Micro is trading at a forward price-to-earnings ratio of 7.56, compared to 14.70 for Dell Technologies (DELL.N).opens new tab and 9.51 for Hewlett Packard Enterprise (HPE.N)opens new tab.

Reporting by Zaheer Kachwala in Bengaluru; Additional reporting by Akash Sriram; Editing by Sriraj Kalluvila and Pooja Desai

Our standards: The Thomson Reuters Trust Principles.opens new tab

Acquire license rights

Super Micro slumps as weak guidance and uncertainty over its annual report fuel investor fears

Similar Posts

'The Tribe' Trailer: Ananya Panday's Cousin Alanna and Javed Jaffrey's Daughter Put the Spotlight on Influencer Life | Web series

Jacksonville Jaguars trade Trevor Lawrence to Bills

Leave a Reply Cancel reply