Super Micro Computer, Inc. (NASDAQ:SMCI) pared some of its Thursday losses after announcing it is expanding its server lineup with the launch of its new MicroBlade multi-node solution, which incorporates Advanced Micro Devices, Inc.’s (NASDAQ:AMD) new EPYC 4005 series processors.
The artificial intelligence server company said it designed the new system to provide a powerful, efficient, and affordable IT solution for cloud service providers and businesses looking to modernize their data centers. Supermicro highlighted the system’s extreme density, noting that a single 48U rack can house up to 160 individual servers and 16 Ethernet switches.
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According to Supermicro, the MicroBlade architecture offers significant advantages over traditional 1U servers, including up to 95% less cabling, 70% space savings, and 30% energy savings. The system also simplifies network and system management with built-in switches and open industry-standard management tools.
Supermicro is targeting the new MicroBlade for a range of applications, including dedicated hosting, virtual desktop infrastructure (VDI), online gaming, and AI inferencing.
On Thursday, Supermicro stock tanked close to 9% after it revealed that it expects first-quarter revenue of approximately $5 billion, down from its prior forecast of $6 billion to $7 billion.
The company attributed the revision to a timing issue, clarifying that more than $12 billion in recent design wins are now scheduled for delivery in the second quarter instead of the first.
Despite the near-term revenue shift, CEO Charles Liang expressed strong confidence in the company’s momentum. He stated that customer demand is accelerating, particularly for its new AI liquid-cooled solutions, and that Supermicro is gaining market share.
Liang also reiterated the company’s long-term target of achieving at least $33 billion in revenue in fiscal year 2026, noting that it is just beginning to ship its latest systems featuring new Nvidia Corporation (NASDAQ:NVDA) and AMD products.
However, Supermicro also faces significant internal and financial challenges. It disclosed material weaknesses in its financial controls, leading to a missed 2024 filing deadline and the resignation of its auditor, Ernst & Young. Supermicro warned that these unresolved issues could affect the accuracy of its future reports.
These accounting problems, combined with a weaker-than-expected earnings report, concerns over guidance, and pressure on its profit margins, caused the company’s stock to fall sharply in August.
Despite these issues, strong investor demand for the company’s AI-focused servers has propelled its stock to a gain of more than 57% so far this year.
Price Actions: SMCI shares were trading higher by 2.57% to $49.15 premarket at last check on Friday.
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