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Valued at a market capitalization of $24.4 billion, Super Micro Computer (SMCI) is a server manufacturer that has returned more than 1,300% to its shareholders over the past decade. Despite these outsized gains, the tech stock is down 65% from all-time highs, allowing you to buy the dip in June 2025.
Super Micro is poised to benefit from the artificial intelligence megatrend and has recently announced a strategic collaboration with Ericsson (ERIC) to accelerate Edge AI deployment. This partnership combines Super Micro’s leading AI platforms with Ericsson’s 5G connectivity solutions. The memorandum of understanding targets commercial bundles that deliver low-latency AI capabilities for businesses requiring real-time processing outside traditional data centers.
The partnership addresses the growing demand for Edge AI applications across various industries, including retail, manufacturing, healthcare, and traffic management. Supermicro’s extensive infrastructure portfolio, ranging from fanless devices to rackmount systems, will integrate with Ericsson’s wireless WAN solutions to enable AI deployment where wired connectivity isn’t viable.
Key applications include real-time retail checkout processing, industrial machinery monitoring, adaptive traffic management, and healthcare inventory optimization. The collaboration leverages 5G features, such as network slicing and zero-trust security, to extend the reach of AI to smart intersections, remote infrastructure, and manufacturing environments. This agreement should allow SMCI to capitalize on the expanding Edge AI market while diversifying beyond traditional data center applications, driving revenue growth.
Is Super Micro Stock a Good Buy Right Now?
Super Micro Computer is aggressively expanding its AI infrastructure footprint through multiple strategic initiatives, positioning the company as a dominant force in enterprise AI deployment. Earlier this year, SMCI announced a $20 billion memorandum of understanding with DataVolt to build hyperscale AI campuses in Saudi Arabia, leveraging Supermicro’s advanced direct liquid cooling technology that reduces power costs by up to 40% and total cost of ownership by 20%.
Supermicro’s AI portfolio continues to expand with new Nvidia (NVDA) RTX PRO 6000 Blackwell Server Edition systems. It is also introducing solutions featuring Advanced Micro Devices (AMD) Instinct MI350 series GPUs.
Strategic partnerships with Nvidia and AMD strengthen Supermicro’s position in Enterprise AI Factory deployments, with the company’s Data Center Building Block Solutions reducing typical deployment timelines from 12 to 18 months to as little as three months. This end-to-end approach eliminates vendor coordination complexity while providing single-point accountability.
To fund continued growth, Supermicro announced plans for a $2 billion convertible senior notes offering due 2030, with proceeds supporting working capital expansion and business development.
With its global manufacturing capabilities and proven liquid cooling solutions at scale, Supermicro is well-positioned to capitalize on the accelerating adoption of enterprise AI across various industries, from retail to healthcare.
Is SMCI Stock Undervalued?
Analysts tracking SMCI stock forecast its revenue to grow from $14.94 billion in fiscal 2024 (ended in June) to $37.7 billion in fiscal 2027. In this period, adjusted earnings are forecast to expand from $2.21 per share to $4.05 per share.
If SMCI stock is priced at 25x forward earnings, which is not too expensive, it will trade around $100 in June 2026, indicating upside potential of 150% from current levels. Of the 15 analysts tracking SMCI stock, four recommend “Strong Buy,” three recommend “Moderate Buy,” six recommend “Hold,” and two recommend “Strong Sell.” The average target price for SMCI stock is $45, above the current price near $41.
