Update:
Super Micro Computer has successfully submitted the required Form 10-K. The document can be accessed here.
Super Micro Computer (NASDAQ: SMCI), a key player in the server and liquid-cooled AI rack markets, has revised its loan covenants in a way that appears aimed at mitigating potential impacts from a stock delisting.
The Nasdaq exchange has granted SMCI until February 25th to submit its annual report for 2024 on the required Form 10-K. Failure to comply could lead to delisting.
Recently, Super Micro Computer took steps to amend its loan covenants to prepare for the possibility of a delisting. Notably, if delisted, the company’s two convertible notes would be due for immediate repayment. However, they modified the covenants to stipulate that repayments would not be triggered if they secure a buyout offer valued at least 90% of the market capitalization and paid in shares of another publicly listed company.
In an effort to prevent bondholders from calling for repayment in the event of a delisting, Super Micro Computer is offering a “special dividend” if it does not meet the Nasdaq deadline.
Super Micro Computer has not filed its mandatory financial statements with the SEC since August 2024, following allegations of extensive financial misconduct by Hindenburg Research. This led the company to pause all filing activities while they conducted a thorough internal audit. In October, Ernst & Young, the company’s auditor, resigned, expressing concerns about corporate governance and board independence.
In February, Super Micro Computer reported preliminary earnings for fiscal Q2’25, indicating revenue of $5.65 billion, slightly below the anticipated $5.89 billion (as estimated by LSEG). The company also shared a non-GAAP EPS of $0.59, surpassing the consensus estimate of $0.54 per share.
Despite recent challenges, Super Micro Computer increased its revenue forecast for FY 2026 significantly, projecting $40 billion in total revenue, contrasting with Wall Street’s consensus estimate of $29 billion.
Goldman Sachs noted that SMCI possesses considerable production capacity to support its growth trajectory, stating:
“The company believes it has sufficient production capacity across its global footprint to support its revenue outlook once components (i.e., GPUs) become available, with the current ability to produce 1,500 DLC racks per month and ample production headroom (Taiwan facility at ~60% utilization, US at ~55% utilization, Malaysia still ramping at ~1%).”
In conclusion, Super Micro Computer remains determined to meet Nasdaq’s filing requirements, indicating ongoing efforts to resolve its financial reporting issues.
