Supermicro Nearly Doubles Sales as Margins Rebound
Gross margin expanded to 17.5% as a richer enterprise mix lifted profitability.
Super Micro Computer (SMCI), the AI server maker, nearly doubled quarterly sales to $11.1 billion as earnings and profitability climbed from a year earlier.
The fourth-quarter advance marked a reversal in the company’s recent sales trajectory. Revenue rose 8.8% from $10.2 billion in the third quarter, after falling from $12.7 billion in the second quarter.
Net income increased to $1.18 billion from $195 million a year earlier, while diluted earnings rose to $1.62 a share from $0.31. Non-GAAP earnings increased to $1.70 a share from $0.41, extending gains across each quarter of the fiscal year.
Supermicro attributed the profitability improvement to a richer mix of enterprise customers and broader adoption of its Data Center Building Block Solutions architecture. GAAP gross margin rose eight percentage points from a year earlier and widened sharply from 9.9% in the third quarter and 6.3% in the second.
For the full year, sales rose 77.8% to $39.1 billion and net income more than doubled to $2.23 billion. Revenue landed within Supermicro’s latest forecast but below its earlier outlook of at least $40 billion, while full-year gross margin narrowed to 10.8% from 11.1%.
The company projects first-quarter sales of $14.5 billion to $15.5 billion, implying sequential growth of roughly 30% to 39%. It expects GAAP earnings of $0.89 to $0.98 a share and non-GAAP earnings of $1.01 to $1.10 a share, below fourth-quarter levels despite the anticipated revenue increase.
Supermicro also expects fiscal 2027 sales of $65 billion to $72 billion, compared with $39.1 billion in fiscal 2026. The company entered the year with record backlog after generating more than $60 billion of new orders during fiscal 2026.
Operating cash flow turned positive at $747 million in the quarter, though the full-year outflow reached $6.81 billion as inventory and receivables expanded. The board was conducting an independent review of certain transactions tied to export-control issues, and the outcome could affect forecasts, preliminary results and results from prior periods.