Super Micro Stock Woes Intensify Amid Delisting Worries But A Section Of Retailers Still Back Beleaguered AI Server Maker

Super Micro Computer, Inc. ($SMCI) stock fell sharply in premarket trading on Thursday as fears concerning potential delisting weigh down on sentiment.

The stock retreated 6.31% on Wednesday and is down an incremental 9.20% at $18.46 as of 6:24 am ET in Thursday’s premarket session. 

Super Micro's shares came under pressure after the artificial intelligence server manufacturer said in a filing with the SEC on Wednesday that it was unable to file its 10-Q report for the September quarter in a timely manner without unreasonable effort or expense.

Super Micro’s 10-K filing for the fiscal year ended June 30, 2024 has already been delayed after its auditor Ernst & Young resigned. citing concerns over internal concerns and other matters. 

A Special Committee that was appointed by the Audit Committee of the company’s board has completed its investigation but is engaged in other work that is ongoing, Super Micro said in Wednesday's filing. The company expects the review to be completed soon. 

Super Micro said it may also need additional time to appoint another auditor, to complete the assessment of the effectiveness of its internal controls over the financial reporting as of June 30, 2024 and for the new auditor to conduct audit of both the 10-K and the 10-Q reports.

Super Micro now has until Nov. 16 to either file the 10-K report for the fiscal year 2024 or submit a plan to the Nasdaq to regain compliance with the listing standards.

If the company does not meet the deadline, there is the danger of the shares being delisted from the Nasdaq. But the stock will continue to trade over the counter.

Previously in Aug. 2018, Super Micro shares were delisted for late-filing of the financial reports but they were relisted in Jan. 2020. 

Retail sentiment on the stock was mixed, with some on the Stocktwits platform still willing to stick by the stock. Those positive are hoping for the Nasdaq granting an extension to and the stock snapping back up.

Another flagged a far more severe threat of a likely debt default by the company. 

Super Micro shares gained solid momentum this year amid the acceleration in AI adoption and their subsequent inclusion in the S&P 500 Index. With the mess the company finds itself in, sell-side analysts have raised the possibility of customers shifting allegiance. Recently, Morgan Stanley analysts raised the price target for Dell Technologies, Inc. ($DELL) shares, with some of the optimism premised on the company taking one-third of Super Micro’s business via competitive wins.

Read Next: FedEx CFO John Dietrich Says Shipping Giant Equipped To Adapt To Incoming Trump Administration’s Tariffs

For updates and corrections email newsroom@stocktwits.com 

Share

·

Add us on