Super Micro Computer’s
standout quarterly results and bullish sales guidance offer another sign of robust demand for artificial intelligence chips and hardware. The news may also bode well for
Nvidia.
Super Micro—a leading independent manufacturer of high-end AI servers for data centers—delivered Nvidia-style results late Monday, trouncing Wall Street’s expectations and significantly raising its outlook. The server maker has a close partnership with Nvidia for graphics processing unit, or GPU, supplies.
Super Micro reported earnings of $5.59 a share on revenue of $3.66 billion in the three months ended in December, which is the second quarter of the company’s 2024 fiscal year. Analysts surveyed by FactSet had expected earnings of $5.16 a share on revenue of $2.89 billion.
The company’s outlook was even better. Super Micro raised its guidance for fiscal 2024 revenue, expecting sales in the year to the end of June to range from $14.3 billion to $14.7 billion, dramatically above a prior forecast of $10 billion to $11 billion.
“While we continue to win new partners, our current end customers continue to demand more Supermicro’s optimized AI computer platforms and rack-scale Total IT Solutions,” said CEO Charles Liang in a statement. “As our innovative solutions continue to gain market share, we are raising our fiscal year 2024 revenue outlook.”
On a conference call with investors and analysts, management said demand is still outstripping supply and their order backlog continues to grow.
Super Micro shares—already up almost 75% so far this year as of Monday’s close—rose another 3.6% to $513.34 in early trading Tuesday. Nvidia stock was up 0.3% to $626.19.
Nevertheless, “in the wake of yesterday’s bumper earnings and outlook from
Super Micro Computer,
there is a renewed feeling of optimism around the potential size and longevity of this AI boom,” said Joshua Mahony, an analyst at broker Scope Markets. “We can clearly see that businesses within the sector are seeing demand intensify as AI adoption grows.”
In December, Barron’s said in a cover story that Nvidia, Super Micro, and
Vertiv
are the three companies best positioned to take advantage of the AI infrastructure build out inside data centers. Super Micro shares have rallied about 90% over the past two months.
Super Micro’s guidance and demand outlook is the latest positive sign for Nvidia. Last week, Nvidia CEO Jensen Huang told reporters in Taiwan demand for artificial intelligence GPUs is strong.
“The single greatest challenge in AI, of course, is scaling the capacity of AI. We are very severely supply constrained,” he said. “Last year was the beginning. This year is going to be a huge year.”
Write to Jack Denton at [email protected]
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