Quarterly Revenue Falls Below Expectations
Super Micro Computer, Inc. (NASDAQ: SMCI), a leading provider in the
AI server market, reported fourth-quarter financial results that fell short of Wall Street estimates. The company posted revenue of $5.76 billion for the quarter, missing analyst projections of $5.89 billion
[3]. Year-over-year, this represents an 8% increase, but the growth did not meet the heightened analyst expectations driven by AI infrastructure demand
[2][3].
Profitability Pressures Persist
- Earnings per share reached $0.41, below the consensus estimate of $0.44
[1].
- Gross margin declined to 9.5%, down from 9.6% in Q3 and 10.2% a year ago
[1].
- Full-year net sales were $22.0 billion, up from $15.0 billion in the previous fiscal year, while full-year earnings per share decreased from $1.92 to $1.68
[1].
After the report, Super Micro’s stock experienced a steep selloff, reflecting investor concern about shrinking margins and the company's near-term growth outlook
[2].
Challenging Outlook Despite AI Momentum
Super Micro’s management acknowledged ongoing issues related to competition with larger server manufacturers and margin compression, both of which contributed to the earnings miss. CEO Charles Liang highlighted the company’s progress, stating: “We made solid progress in FY25 by growing our AI solution leadership in Neoclouds, CSPs, Enterprises, and Sovereign entities, which fueled our 47% annual growth.”
[1]
However, guidance for the first quarter of FY2026 was also below analyst expectations, amplifying concerns about near-term profitability, even as the overall demand for AI hardware remains robust
[2].
Financial Position and Industry Standing
- The company ended the quarter with $5.2 billion in cash and equivalents, and $4.8 billion in debt and convertible notes
[1].
- Super Micro reaffirmed its full-year revenue target of $33 billion, signaling confidence in long-term demand for
AI data center solutions
[2].
While Super Micro remains a major player in the rapidly growing AI server sector, the latest earnings underline the sector’s volatility and the ongoing challenges of maintaining strong margins in a highly competitive landscape.
