Super Micro Computer (SMCI) - Company Research

Last Updated: 11 Oct 2026

Super Micro Computer Inc. (NASDAQ: SMCI), known as Supermicro, designs and builds servers, storage and complete liquid-cooled AI racks. Its main customers are hyperscale, neocloud and enterprise data centres. The company was founded in 1993 by Charles Liang, who is still President, CEO and Chairman, and is based in San Jose, California. In fiscal 2026, which ended 30 Jun 2026, net sales rose 77.8% to $39.06bn on demand for NVIDIA GB200 and GB300 rack-scale systems. Management guided FY2027 net sales of $65–72bn and reported more than $60bn of new orders during FY2026. Growth has come with costs. Operating cash flow was −$6.8bn because inventory and receivables built up, and total debt rose to about $8.7bn. In March 2026 a co-founder was indicted for export-control violations, and the auditor gave an adverse opinion on internal controls. A board-led investigation concluded in Aug 2026 and found no evidence that current senior management knew of the diversion.

1. Company Snapshot

Field	Value
Ticker	SMCI (Nasdaq Global Select Market); SMCIP depositary shares (7.00% Series A Mandatory Convertible Preferred)
Headquarters	980 Rock Avenue, San Jose, California (Delaware corporation)
CEO / Leadership	Charles Liang (founder, President, CEO and Chairman); David Weigand (SVP and CFO)
Employees	Over 7,000 at 30 Jun 2026, including ~3,500 in R&D and ~2,100 in manufacturing (FY2026 Form 10-K)
Sector	Information Technology: servers, storage and AI data-centre infrastructure
FY2026 Revenue	$39.06bn (+77.8% YoY)
FY2026 Net income (GAAP)	$2.23bn; diluted EPS $3.26 (non-GAAP $3.63)
FY2027 guidance	Net sales $65–72bn; Q1 FY2027 net sales $14.5–15.5bn
Market cap	~$27.5bn (9 Oct 2026 close $41.85 × 657.0m shares at 31 Jul 2026)
Fiscal year end	30 Jun

Liang and his wife, co-founder and director Sara Liu, are still large shareholders. Liang reports about 40.4m shares held directly and a further 25.3m held jointly with Liu. A 10-for-1 stock split took effect on 30 Sep 2024, and all per-share figures below are split-adjusted.

2. Bull & Bear

Bull Case

• Revenue scale-up: Net sales rose from $5.2bn in FY2022 to $39.1bn in FY2026. The FY2027 guidance of $65–72bn implies another 66–84% of growth.
• Margin recovery in Q4: GAAP gross margin was 6.3% in Q2 FY2026 and 9.9% in Q3, then reached 17.5% in Q4. The CEO credited a richer enterprise mix and wider adoption of DCBBS.
• Order book: The company reported more than $60bn of new orders in FY2026 and record backlog. About $39bn of AI server orders arrived in the weeks before the Jun 2026 equity raise.
• Early to market with new platforms: Supermicro began shipping NVIDIA Vera Rubin NVL72 racks with its DLC-2 liquid cooling on 23 Sep 2026. It has capacity for up to 3,000 racks a month, 2,000 of them liquid-cooled.
• Investigation finished: The independent review by Munger Tolles and AlixPartners found no evidence that current senior management knew of the server diversion and no direct sales to restricted parties. No restatement was indicated.

Bear Case

• Cash consumption: FY2026 operating cash flow was −$6.81bn. Inventory used $8.88bn of cash and receivables $3.92bn, and non-cancellable purchase commitments total $34.2bn.
• Leverage and dilution: Total debt is about $8.7bn: $4.06bn of bank lines and term loans plus $4.66bn of convertible notes. On top of that sit a $4.2bn mandatory convertible preferred, 45.5m new shares sold at $27.50 and a $1.25bn ATM programme.
• Governance and legal overhang: Co-founder Wally Liaw goes on trial in SDNY on 2 Nov 2026. SEC and Commerce Department export inquiries are ongoing, and BDO gave an adverse ICFR opinion for FY2026.
• Concentration: One customer was 28.1% of FY2026 net sales, and one supplier accounted for 63.1% of purchases.
• Thin, volatile margins: FY2026 GAAP gross margin was 10.8% and operating margin 7.1%. Quarterly gross margin ranged from 6.3% to 17.5%.

3. Business Segments

Supermicro reports one operating segment. From FY2025 it stopped tagging the split between server and storage systems and subsystems and accessories. The FY2026 10-K does disclose service and software revenue and a geographic breakdown.

Segment / category	% of revenue (FY2026)	What it is
Hardware: server and storage systems, subsystems and accessories	~98.6% (~$38.52bn)	GPU and Hyper servers, liquid-cooled rack-scale AI systems (GB200/GB300 and now Vera Rubin), storage, edge and MicroCloud systems, plus server boards, chassis and power supplies
Services and software	~1.4% ($538.3m)	Global services and support ($420.3m), plus server management and DCBBS deployment software

Region	FY2026 net sales	Share
United States	$27.69bn	70.9% (FY2025: 59.4%)
Asia	$6.06bn	15.5%
Europe	$2.67bn	6.8%
Other	$2.64bn	6.7%

4. Business Model & Moat

How it makes money. Supermicro designs systems in-house in San Jose and builds them in the US, Taiwan, Malaysia and the Netherlands. It sells complete servers and racks, increasingly fully integrated and liquid-cooled, directly to large data-centre operators and through channel partners. Revenue is recognised on shipment or acceptance. The economics are those of a high-volume integrator. GPUs and memory make up most of the bill of materials, so gross margins sit in the single digits to mid-teens, and profit depends on fast inventory turns and operating leverage.

The moat. Supermicro’s Building Block Solutions architecture lets it bring each new NVIDIA, AMD or Intel platform to market quickly. In-house direct liquid cooling (DLC-2), from cold plates to CDUs and cooling towers, and the DCBBS data-centre blueprints let it deliver complete scalable units. These range from 5 MW to gigawatt scale and include on-site deployment. Large-scale rack integration and testing capacity is scarce, and buyers pay for the speed it gives them.

Where the moat is thin. Dell, HPE, Lenovo and the Taiwanese ODMs (Foxconn, Quanta, Wiwynn) have access to the same GPUs. Large customers spread orders across several suppliers. GPU allocation is controlled by one dominant supplier. Recurring service and software revenue is only about 1.4% of sales.

5. Financial Health

All figures come from Supermicro’s earnings releases and Form 10-K filings, cross-checked against SEC XBRL company facts. Net sales have grown seven-fold in four years. Working capital and debt have grown with them.

Fiscal Year	Revenue ($m)	YoY %	GAAP EPS	Adjusted EPS	Dividend/share	Long-term debt (YE)
FY2022	$5,196.1m	+46.1%	$0.53	$0.57	Nil	$147.6m
FY2023	$7,123.5m	+37.1%	$1.14	$1.18	Nil	$120.2m
FY2024	$14,989.3m	+110.4%	$1.92	$2.12	Nil	$1,771.8m (incl. $1,697.7m converts)
FY2025	$21,972.0m	+46.6%	$1.68	$2.06	Nil	$4,682.6m (incl. $4,645.2m converts)
FY2026	$39,063.1m	+77.8%	$3.26	$3.63	Nil	$6,680.5m (incl. $4,664.1m converts)

Quarter / Half	Revenue	Adjusted EPS	GAAP EPS
Q4 FY2026 (Apr–Jun 2026)	$11,119.8m	$1.70	$1.62
Q3 FY2026 (Jan–Mar 2026)	$10,243.0m	$0.84	$0.72
Q2 FY2026 (Oct–Dec 2025)	$12,682.5m	$0.69	$0.60
Q1 FY2026 (Jul–Sep 2025)	$5,017.8m	$0.35	$0.26
FY2026 total	$39,063.1m	$3.63	$3.26

FY2026 results. Gross profit was $4.23bn (10.8% margin), operating income $2.77bn and net income $2.23bn.

FY2026 cash flow.

• Operating cash flow: −$6,809.9m (Q4 alone was +$747m)
• Capex: $162.0m
• Depreciation and amortisation: $53.7m in the cash-flow add-back, plus $36.6m of right-of-use asset amortisation

Balance sheet at 30 Jun 2026.

• Cash and equivalents of $7,521.5m and $23.1m of marketable securities.
• Current bank debt of $2,039.8m, non-current bank debt of $2,016.4m and convertible notes of $4,664.1m, for total debt of about $8,720m.
• The $4,226.3m mandatory convertible preferred sits in equity.
• Inventory was $12.90bn.

Debt detail. The convertible notes are $700m of 2.25% notes due 2028, $1,725m of 0% notes due 2029 and $2,300m of notes due 2030. The bank lines are $2.0bn drawn on the JPMorgan revolver and $1.76bn on CTBC facilities. Interest expense rose from $59.6m in FY2025 to $194.6m in FY2026.

6. Valuation

Raw metrics, October 2026. Not opinions on whether the stock is cheap or expensive.

Metric	Value
Market cap	~$27.5bn (9 Oct 2026 close $41.85 × 657.0m shares)
Enterprise value	~$28.7bn (market cap ~$27.5bn + total debt ~$8.72bn − cash and marketable securities ~$7.54bn, from the 30 Jun 2026 balance sheet). This excludes the $4.23bn mandatory convertible preferred; including it gives ~$32.9bn.
Trailing P/E (GAAP)	~12.8x ($41.85 / FY2026 diluted EPS $3.26). On non-GAAP EPS of $3.63 the multiple is ~11.5x.
P/E (forward)	~9.9x on annualised Q1 FY2027 non-GAAP EPS guidance (midpoint $1.055 × 4 = $4.22); ~11.2x on annualised GAAP guidance (midpoint $0.935 × 4)
P/S (TTM)	~0.70x (market cap ~$27.5bn / FY2026 net sales $39.06bn)
EV/EBITDA (TTM)	~10.2x (EV ~$28.7bn / EBITDA ~$2.82bn; EBITDA = operating income $2,770.5m + D&A $53.7m from the FY2026 cash-flow statement)
P/FCF	n/m: FCF is negative at about −$6.97bn (operating cash flow −$6,809.9m − capex $162.0m in FY2026)
52-week high	$58.51
52-week low	$19.48
Short interest (% of float)	17.26% (95.16m shares, settlement date 15 Sep 2026, MarketBeat)
Days to cover	2.7

Earnings-based multiples look low compared with the growth guidance. However, free cash flow is deeply negative because of the inventory build. The convertible notes, mandatory preferred and ATM programme together mean the per-share count could rise by a large amount. The company’s own Q1 FY2027 guidance assumes 761m non-GAAP diluted shares, against 657m basic shares outstanding.

7. What Are They Building

Vera Rubin NVL72 racks. Shipping began on 23 Sep 2026. Each rack holds 72 Rubin GPUs and 36 Vera CPUs, and the reference scalable unit links 16 racks for 1,152 GPUs. Customers can order a scalable unit and receive a production-ready, integrated system.

DCBBS and DLC-2 liquid cooling. Data Center Building Block Solutions packages compute, storage, networking, power, liquid cooling, site design and on-site deployment into blueprints from 5 MW to gigawatt scale. A rack line launched on 30 Jul 2026 can produce up to 3,000 racks a month, 2,000 of them liquid-cooled.

AMD Helios. At Computex in Jun 2026 Supermicro showed an AMD Helios rack with 72 liquid-cooled MI455X GPUs, built as part of DCBBS. It gives the company a second accelerator roadmap alongside NVIDIA.

Manufacturing footprint. The company is adding capacity in Silicon Valley, Taiwan, Malaysia and the Netherlands. A Malaysian 10-year tax exemption depends on meeting an investment threshold by 16 Dec 2026.

8. Peer Comparison

Peer	Market cap (October 2026)	Key 2025 metric
Dell Technologies (DELL)	~$372bn (6 Oct 2026, Google Finance)	FY2026 revenue $113.5bn (+19%); Infrastructure Solutions Group $60.8bn (+40%) (Dell Q4 FY2026 release)
Hewlett Packard Enterprise (HPE)	~$97.5bn (10 Oct 2026, companiesmarketcap.com)	FY2025 revenue $34.3bn (+13.8%) (HPE FY2025 Form 10-K)
Lenovo Group (0992.HK)	~$51.9bn (Oct 2026, companiesmarketcap.com)	FY2025/26 revenue $83.1bn (+20%); Infrastructure Solutions Group $19.2bn (Lenovo FY2025/26 results)
Celestica (CLS)	~$44–48bn (Nasdaq $43.97bn on 5 Oct 2026; companiesmarketcap.com $48.3bn)	2025 revenue $12.4bn (+28%) (Celestica FY2025 release)
Super Micro Computer (SMCI)	~$27.5bn (9 Oct 2026)	FY2026 net sales $39.06bn (+77.8%); GAAP gross margin 10.8%

Supermicro had the fastest revenue growth in the group, but its market cap is now smaller than that of every peer in the table, including Celestica, which has about a third of its revenue.

9. Insider Activity

CEO Charles Liang has not bought or sold shares himself in 2026. He reports the sales below on his own Form 4s as an indirect holder, because the shares belong to his wife, co-founder and director Sara Liu. MarketBeat records no insider purchases in the past 12 months.

Name	Date	Type	Shares	Price	Value	Plan Type
Sara Liu (co-founder and director; also reported indirectly by Charles Liang)	07 Oct 2026	Sale	100,000	$45.02 (avg)	~$4.50m	10b5-1 (adopted 26 May 2026; up to 300,000 shares; expires 28 Feb 2027)
Sara Liu (co-founder and director; also reported indirectly by Charles Liang)	03 Sep 2026	Sale	100,000	$37.19	~$3.72m	10b5-1 (same plan)

The two sales total about $8.2m. Aggregators that add up both Liu’s and Liang’s Form 4s count the same shares twice. Up to 100,000 more shares can be sold under the plan before it expires.

10. Key Risks

• Material litigation and investigations: SMCI is not a defendant in the SDNY export-control case (US v. Liaw), but it has received a grand jury subpoena and a second SEC subpoena, and is subject to Commerce Department export enforcement inquiries. Penalties or export restrictions could follow, and securities class actions and derivative suits are pending.
• Customer and supplier concentration: One customer was 28.1% of FY2026 net sales, and two customers made up 23.0% and 17.1% of receivables. One supplier accounted for 63.1% of purchases.
• Working capital and leverage: Operating cash flow was −$6.8bn, with $34.2bn of purchase commitments, about $8.7bn of debt and interest expense of $194.6m. The company depends on credit lines and capital markets staying open.
• Internal controls: BDO gave an adverse ICFR opinion at 30 Jun 2026, and one IT general-controls material weakness is still unresolved.
• Dilution: Converts due 2028, 2029 and 2030, the mandatory convertible preferred (which converts by Jun 2029) and the $1.25bn ATM programme could add a large number of shares.
• AI demand and margin volatility: Results depend on GPU allocation and hyperscaler capex cycles. Quarterly gross margin ranged from 6.3% to 17.5% in FY2026, and inventory write-downs were $188.1m.
• Patents, tariffs and taxes: Netlist has brought ITC patent complaints. Tariff exposure is ongoing, and the Malaysian tax incentive has not yet been approved.

11. Recent Developments

• 08 Oct 2026 — Board changes. Shesha Krishnapura, formerly CTO of Intel IT, was appointed an independent director effective 9 Oct 2026. Director Judy Lin gave notice of her retirement on 7 Oct.
• 07 Oct 2026 — Co-founder 10b5-1 sale. Sara Liu sold 100,000 shares at an average of $45.02 (about $4.5m) under a plan adopted in May 2026.
• 23 Sep 2026 — Vera Rubin NVL72 shipping. Supermicro began shipping NVIDIA Vera Rubin NVL72 racks with DLC-2 liquid cooling as part of DCBBS.
• 31 Aug 2026 — FY2026 Form 10-K filed. The audited figures matched the preliminary results. BDO gave an adverse opinion on internal control over financial reporting; three earlier material weaknesses were fixed and one IT controls weakness remains.
• 20 Aug 2026 — Independent investigation completed. The review found no evidence that current senior management knew of the diversion of servers to China and no direct sales to restricted parties. Some employees were dismissed and export compliance was strengthened.
• 11 Aug 2026 — FY2026 results. Q4 net sales were $11.12bn, GAAP gross margin 17.5% and non-GAAP EPS $1.70. FY2026 net sales were $39.06bn. Guidance is $14.5–15.5bn of net sales for Q1 FY2027 and $65–72bn for FY2027. The shares rose about 19% the next day.
• 05 Aug 2026 — First preferred dividend declared. The SMCIP depositary shares received $0.73889 per share, paid on 1 Sep 2026.

12. Key Dates

• 02 Nov 2026 — Scheduled start of the SDNY criminal trial of co-founder Wally Liaw (US v. Liaw).
• Expected Nov 2026 — Q1 FY2027 results. The date has not yet been announced; Q1 results have usually come in early November.
• 01 Dec 2026 — Next scheduled quarterly dividend on the 7.00% Series A mandatory convertible preferred, subject to board declaration.
• 16 Dec 2026 — Deadline to meet the investment threshold for the Malaysian 10-year tax exemption.
• 04 Feb 2027 — 2027 Annual Meeting of Stockholders, expected to be held virtually (per the FY2026 Form 10-K).
• 28 Feb 2027 — Expiry of Sara Liu’s Rule 10b5-1 trading plan.

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