New York, February 5, 2026, 15:41 EST — Regular session.
- Super Micro shares dropped roughly 10% Thursday, giving back a portion of Wednesday’s gains
- Company raised its fiscal 2026 revenue forecast to a minimum of $40 billion, though margins continue to be slim
- Profitability remains front and center for investors amid growing concerns over AI spending in the sector
Shares of Super Micro Computer (SMCI.O) dropped roughly 10% to $30.36 by Thursday afternoon, after kicking off the day at $33.01 and briefly reaching $34. Nvidia (NVDA.O) slipped about 1%, while Advanced Micro Devices (AMD.O) tumbled around 5% amid volatile trading in AI-related hardware stocks.
The retreat erases some of Wednesday’s 13.8% surge, fueled by investors chasing Super Micro after it boosted its annual revenue outlook on strong demand for AI-optimized servers. The stock has turned into a barometer for risk appetite around the AI buildout—and it’s moving accordingly. (Reuters)
Alphabet’s announcement of up to $185 billion in capital expenditure—focused on long-term projects like data centers—is hitting a rough patch. Questions are resurfacing about whether the AI-driven spending will boost profits anytime soon. “We’re seeing this volatility about whether this investment will translate, ultimately, into results,” said Tom Hainlin, an investment strategist at U.S. Bank Wealth Management. (Reuters)
Super Micro raised its fiscal 2026 revenue forecast to at least $40 billion from $36 billion on Tuesday, banking on steady demand as clients ramp up data center capacity. The company reported second-quarter revenue of $12.68 billion, well above the $10.23 billion average estimate from LSEG. About $1.5 billion of that came from first-quarter shipments delayed due to customer readiness. It expects third-quarter revenue around $12.3 billion. “Super Micro’s growth is tied to its importance as the integrator to large cloud and AI customers,” said Gadjo Sevilla, a technology analyst at Emarketer. CFO David Weigand added on the earnings call, “Order strength remains strong.” (Reuters)
The quarter outperformed expectations, but profit margins took a hit where it matters. Gross margin — the revenue slice left after hardware and component costs — dropped to 6.3% from 9.3% last quarter, the company reported. Net income stood at $401 million, or $0.60 per share. By December’s end, it held $4.1 billion in cash and equivalents against $4.9 billion in bank debt and convertible notes. For the quarter ending March 31, it projects net sales of at least $12.3 billion. (Super Micro Computer)
Super Micro reported its results in a Form 8-K dated Feb. 3, attaching the press release as an exhibit. The filing noted the info was “furnished” rather than “filed” for specific legal reasons, unless the company indicates otherwise. (SEC)
Thursday’s drop makes it clear the market remains focused on margins. Shifting tons of servers is one challenge; squeezing profit from each unit is quite another, especially as component costs, customer mix, and pricing pressures collide.
Super Micro operates at the heart of the supply chain, building systems with Nvidia and AMD chips before sending them off to cloud and enterprise clients. This position can magnify gains during demand surges but also heightens risks when investors question the true returns of the spending spree.
But the risks are clear. With gross margins stuck in the mid-single digits, any hit from tariffs, rising facility costs, or component shortages could quickly squeeze profits. On top of that, if customers delay orders and shipments shift between quarters, the pressure only mounts.
Traders are eyeing Amazon’s earnings after the bell for new clues on AI data-center spending. They’ll also be looking to see if Super Micro can deliver steadier margins in the quarter ending March 31.
