Super Micro Computer delivered 123% revenue growth year-over-year driven by AI server demand, but a free cash flow deficit of negative 597% relative to net income, 17% short interest, a confirmed death cross, and mixed earnings history indicate the growth story has not yet translated into financial quality.
Thesis pillars
- Exceptional Revenue Growth Ai→Stable
- Severe Negative Cash Conversion→Stable
- High Short Interest Justified→Stable
- +1 more pillar — see the Why tab for full reasoning
Pillars as of Jul 3, 2026, based on the 10-K filed Aug 31, 2026
Super Micro Computer, Inc. (SMCI) Stock Analysis
Technology · Computer Hardware
Sell if holding. At $35.81, A.R:R 0.6:1 is below the 1.5:1 minimum. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Thin upside margin: 8.7%; V7 low-quality RISK_OFF penalty: -0.5 (Q=4.8).
Super Micro Computer, based in San Jose, designs and builds server, storage and rack-scale AI infrastructure, including liquid-cooled systems and its Data Center Building Block Solutions, for enterprise data centers, cloud providers and edge applications. It sold to over 1,000... Read more
Sell if holding. At $35.81, A.R:R 0.6:1 is below the 1.5:1 minimum. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Thin upside margin: 8.7%; V7 low-quality RISK_OFF penalty: -0.5 (Q=4.8). Chart setup: No clear chart pattern; technical signals are mixed. Score 6.4/10, moderate confidence.
Passes 4/8 gates (positive momentum, clean insider activity, semi cycle peak clear, materials cycle peak clear). Fails on favorable risk/reward ratio and earnings proximity 5d<=7d. Suitability: aggressive.
About Super Micro Computer, Inc.
About Super Micro Computer, Inc.
Super Micro Computer reported net income of $2,230.5 million for the fiscal year ended June 30, 2026, up from $1,048.9 million a year earlier, selling server, storage and rack-scale AI infrastructure to more than 1,000 customers in over 100 countries. The San Jose company, with over 3,500 research and development employees, manufactures the majority of its systems at its San Jose headquarters and also operates facilities in Taiwan, Malaysia and the Netherlands.
The company sells Total IT Solutions, including servers, storage, blade systems and networking, alongside Data Center Building Block Solutions that bundle racks, liquid cooling, power distribution, software and services. Its DLC-2 direct liquid cooling design provides heat capture coverage of up to 98% per server rack. Product cycles track processor and GPU launches from NVIDIA, Intel and AMD, and GPUs have represented an increasing portion of cost of sales. Sales run through a direct force aimed at large cloud, enterprise and OEM customers and through distributors, resellers and integrators. Sales to customers outside the United States were 29.1% of net sales in fiscal 2026, down from 40.6% in fiscal 2025. The 10-K names Cisco, Dell, Hewlett-Packard Enterprise and Lenovo as principal competitors, along with original design manufacturers Foxconn, Quanta Computer and Wiwynn. Related parties Ablecom and Compuware provide contract design and manufacturing coordination, and many components are bought on a purchase order basis rather than under long-term contracts.
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Customer concentration and AI demand are the main exposures. One customer accounted for 10% or more of net sales in fiscal 2026, compared with four customers in fiscal 2025, and the 10-K states that the AI industry has driven a significant portion of recent success. Large orders may come with extended payment terms, which could increase credit risk if customers pay late. Governance has also changed recently: in October 2026, the company disclosed via Form 8-K that its board appointed Mark Long as Chief Financial Officer effective October 14, with David Weigand ceasing to serve in that role, while the filing continues to reference earlier delinquent reports and previously identified material weaknesses in internal control.
See also: Technology · Computer Hardware
From Super Micro Computer, Inc.'s most recent 10-K filing, extracted October 18, 2026.
Recent developments
updated 2026-10-29Recent Developments — Super Micro Computer, Inc.
Material events (past 30 days)
- 8K Oct 15, 2026 MEDIUM Item 5.02: Board appointed Mark Long as CFO effective October 14, 2026; David Weigand ceased serving as CFO at that time. Long is a former Western Digital CFO (2016-2019). No reason for Weigand's exit cited in the excerpt.
Latest news
- NEWS Super Micro Computer Stock (SMCI) Opinions on AI Server Demand and Trading Activity - Quiver Quantitative — Quiver Quantitative neutral
- NEWS What's Going On With Super Micro Computer Stock Wednesday? - Benzinga — Benzinga negative
- NEWS Supermicro Soars On Report. Why Nvidia Is Also Rallying. - Investor's Business Daily — Investor's Business Daily positive
- NEWS Why Super Micro Computer Stock Popped Today - Yahoo Finance — Yahoo Finance positive
- NEWS Why Super Micro Computer Stock Popped Today - finance.yahoo.com — finance.yahoo.com positive
Generated 2026-10-29T11:14:35Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- MEDIUMCustomerfew large customers10-K Item 1A: 'We had one customer account for 10% or more of our net sales in fiscal year 2026, four customers account for 10% or more of our net sales in fiscal year 2025'
- MEDIUMProductAI industry demand10-K Item 1A: 'The AI industry has driven a significant portion of our recent success.'
- MEDIUMSupplierlimited number of component suppliers10-K Item 1A: 'We rely on a limited number of suppliers for certain components used to manufacture our products'
- MEDIUMSupplierAblecom and Compuware contract manufacturing10-K Item 1A: 'Our reliance on Ablecom and Compuware could be subject to risks associated with our reliance on a limited source of contract manufacturing services and inventory warehousing'
Material Events(8-K, last 90d)
- 2026-10-15Item 5.02MEDIUMBoard appointed Mark Long as CFO effective October 14, 2026; David Weigand ceased serving as CFO at that time. Long is a former Western Digital CFO (2016-2019). No reason for Weigand's exit cited in the excerpt.SEC filing →
- 2026-10-08Item 5.02LOWBoard appointed Shesha Krishnapura, former Intel IT CTO and Intel Fellow, as an independent director effective October 9, 2026, on standard non-employee director compensation.SEC filing →
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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Rating Breakdown
1 ceiling hit
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Sell if holding. At $35.81, A.R:R 0.6:1 is below the 1.5:1 minimum. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Thin upside margin: 8.7%; V7 low-quality RISK_OFF penalty: -0.5 (Q=4.8). Chart setup: No clear chart pattern; technical signals are mixed. Prior stop was $33.30. Score 6.4/10, moderate confidence.
Analyst target: $38.94 (+8.7% upside). Prior stop was $33.30. Stop-loss: $33.30.
Thin upside margin: 8.7%; V7 low-quality RISK_OFF penalty: -0.5 (Q=4.8); Sector modifier (Technology): -0.8.
Super Micro Computer, Inc. trades at a P/E of 11.0 (forward 6.4). TrendMatrix value score: 8.4/10. Verdict: Sell.
25 analysts cover SMCI with a consensus score of 2.8/5. Average price target: $43.
What does Super Micro Computer, Inc. do?Super Micro Computer, based in San Jose, designs and builds server, storage and rack-scale AI infrastructure, including...
Super Micro Computer, based in San Jose, designs and builds server, storage and rack-scale AI infrastructure, including liquid-cooled systems and its Data Center Building Block Solutions, for enterprise data centers, cloud providers and edge applications. It sold to over 1,000 customers in over 100 countries in fiscal 2026 through a direct sales force and indirect channel partners, and manufactures most systems at its San Jose headquarters.