Market Overview & Trends - Asian and European markets are showing positive movement, influenced by earnings reports and tariff developments [1][3] - US market performance is under scrutiny following a disappointing previous day [2] - Earnings and tariffs are expected to be major focal points during the trading day [4] - A weakening economy is indicated by labor revisions, with the bond market pricing in potential Fed cuts [28] - Market sentiment is influenced by the "buy the dip" mentality (FOMO) and the performance of tech and AI sectors [29][30] Company Specific News - **Glencore:** Abandoned plans to move its primary listing to New York, citing no added value for shareholders, and reported a net loss of $655 million in the first half of 2025, nearly triple the $233 million loss from the previous year [5] - **Glencore:** Launched a $1 billion cost-cutting program in response to lower coal prices, copper production issues, and tariff uncertainties [6] - **Nova Nordisk:** Weight loss drug Wegovy sees sales soar, but US sales disappoint [1][39] - **Disney:** Adjusted earnings per share exceeded expectations at $161 versus an expected $146, while Q3 revenue aligned with expectations at $237 billion, shares are down by over 15% in pre-market [16] - **McDonald's:** Earnings per share slightly missed expectations at $314 versus an expected $315, but revenue exceeded expectations at $684 billion versus an expected $67 billion, shares are up around 3% in pre-market [17][18] - **Uber:** Revenue came in at $1265 billion versus an expected $1248 billion, and earnings per share met expectations at 63 cents, shares are down 14%-16% in pre-market [19] - **AMD:** Analyst suggests the upside is unlimited, expecting to regain $15 billion lost due to China sanctions over the last two quarters [23] - **Honda:** Raised its annual profit guidance despite a 50% year-over-year fall in operating profits in the first quarter, citing a smaller-than-expected impact from tariffs [45] - **Open Door:** Shares are down over 20% in pre-market after offering disappointing guidance, citing a challenging macro environment and persistent housing market weakness [46] - **Super Micro Computer:** Shares are plunging in pre-market after cutting its annual sales forecast, with fourth-quarter results falling below expectations due to order delays from economic uncertainty [47] - **Snap:** Analyst says numbers are better than feared, but results are not encouraging compared to the rest of the ad complex, stock is down another quick 15% after hours [49][51] Tariffs & Trade - Countries are pushing for last-minute trade deals as the tariff deadline approaches [7] - Switzerland is attempting to avoid 39% tariffs [9] - India is facing potential increases in tariffs due to its consumption of Russian oil [9] - A 90-day pause on tariffs is expected to be extended, potentially paving the way for a Trump-Xi meeting [13] Federal Reserve (The Fed) - There is speculation about a potential interest rate cut by the Federal Reserve in September, with some suggesting a possible 50 basis point cut [31][32]

I'm a full time value investor and writer who enjoys using classical value ratios to pick my portfolio. My previous working background is in private credit and CRE mezzanine financing for a family office. I'm also a fluent Mandarin speaker in both business and court settings, previously serving as a court interpreter. I have spent a good chunk of my adult working life in China and Asia. I have worked with top CRE developers in the past including The Witkoff Group , Kushner Companies, Durst Organization and ...

Summary of Super Micro Computer Inc. (SMCI) Earnings Call Company Overview - **Company**: Super Micro Computer Inc. (SMCI) - **Industry**: AI server and storage systems Key Financial Metrics - **F4Q25 Revenue**: $5.76 billion, missing the consensus estimate of $5.98 billion [1][6] - **Gross Margins**: 9.6%, below the expected 10% [1][6] - **F1Q26 EPS Guidance**: $0.40-$0.52, missing the consensus of $0.59 [1][3] - **F2026 Sales Outlook**: At least $33 billion [1][4] Core Insights - **Earnings Miss**: SMCI's F4Q25 EPS of $0.41 missed the consensus of $0.44-$0.45, indicating a revenue and margin miss [2][6] - **Revenue Breakdown**: - Server & storage systems: $5.62 billion, down 3% YoY - Subsystems & accessories: $139 million, down 38% YoY [7][8] - **Operating Income**: Non-GAAP operating income of $312 million, missing estimates of $357 million [6][8] Competitive Landscape - **Market Dynamics**: The company is facing intensified competition in the AI server market, which is becoming increasingly commoditized [1][10] - **Customer Delays**: Continued delays in customer platform decisions are impacting revenue [1] Additional Considerations - **Stock-Based Compensation**: Approximately $69 million in stock-based compensation was reported, netting a tax effect of $20 million excluded from non-GAAP net income [3] - **Investment Rating**: Goldman Sachs has a "Sell" rating on SMCI with a 12-month target price of $24, reflecting a potential downside of 58.8% from the current price of $58.23 [9][13] Risks and Opportunities - **Upside Risks**: Stronger-than-expected demand for AI servers, market share gains, core operating margin improvement, and customer diversification are potential upside risks [9] - **Long-term Outlook**: While SMCI has established partnerships with key AI component suppliers like NVIDIA and AMD, the competitive landscape poses risks to profitability [10]

Group 1 - The focus has shifted from primarily tech stocks to include offshore drilling, supply industry, and shipping sectors such as tankers, containers, and dry bulk [1] - There is an emerging interest in the fuel cell industry, which is still in its nascent stage [1] Group 2 - The individual has a background in auditing with PricewaterhouseCoopers and transitioned to day trading nearly 20 years ago [2] - The experience includes navigating significant market events such as the dotcom bubble, the aftermath of the World Trade Center attacks, and the subprime crisis [2]

Group 1: Earnings Performance - Super Micro Computer (SMCI) reported quarterly earnings of $0.41 per share, missing the Zacks Consensus Estimate of $0.44 per share, and down from $0.63 per share a year ago, representing an earnings surprise of -6.82% [1] - The company posted revenues of $5.76 billion for the quarter ended June 2025, missing the Zacks Consensus Estimate by 3.82%, compared to year-ago revenues of $5.31 billion [2] - Over the last four quarters, Super Micro has surpassed consensus EPS estimates two times and topped consensus revenue estimates two times [2] Group 2: Stock Performance and Outlook - Super Micro shares have increased approximately 91% since the beginning of the year, significantly outperforming the S&P 500's gain of 7.6% [3] - The company's earnings outlook is crucial for assessing future stock performance, with current consensus EPS estimates at $0.56 on $6.61 billion in revenues for the coming quarter and $2.51 on $29.63 billion in revenues for the current fiscal year [7] Group 3: Industry Context - The Computer-Storage Devices industry, to which Super Micro belongs, is currently ranked in the top 21% of over 250 Zacks industries, indicating a favorable industry outlook [8] - Another company in the same industry, Quantum Corp. (QMCO), is expected to report a quarterly loss of $0.15 per share, reflecting a year-over-year change of +91.7%, with revenues projected at $73.7 million, up 3.3% from the previous year [9]

Financial Data and Key Metrics Changes - Fiscal year 2025 revenues reached $22 billion, reflecting a 47% year-on-year growth [8][20] - Q4 fiscal year 2025 revenues were $5.8 billion, up 8% year-over-year and 25% quarter-over-quarter [20] - Non-GAAP earnings per share for Q4 were $0.41, down from $0.50 year-over-year, primarily due to tariff impacts [9][25] - Non-GAAP gross margin for Q4 was 9.6%, slightly down from 9.7% in Q3 [23] Business Line Data and Key Metrics Changes - Enterprise channel segment revenues in Q4 were $2.1 billion, representing 36% of total revenues, up 7% year-over-year [20] - OEM appliance and large data center segment revenues were $3.7 billion, representing 63% of Q4 revenues, up 40% quarter-over-quarter [21] - The emerging 5G telco edge IoT segment accounted for 1% of Q4 revenues [21] Market Data and Key Metrics Changes - By geography, the US represented 38% of Q4 revenues, Asia 42%, Europe 15%, and the rest of the world 5% [22] - Year-over-year, US revenues decreased by 33%, while Asia increased by 91% and Europe by 66% [22] Company Strategy and Development Direction - The company is focusing on AI and green computing solutions, with a strategic emphasis on enterprise IoT and telco markets [10][16] - Introduction of the Data Center Building Block Solution (DCBBS) aims to simplify customer data center infrastructure and reduce time to market [12][14] - The company anticipates revenue between $6 billion and $7 billion for Q1 fiscal year 2026, with a long-term goal of at least $33 billion for the full fiscal year 2026 [18][28] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in overcoming previous capital constraints and expects improved chip availability from vendors like NVIDIA [34][35] - The company is optimistic about growth in the AI server market and believes it can achieve both revenue growth and margin expansion [40][66] - Management highlighted the importance of the DCBBS in accelerating customer deployments and enhancing profitability [42][66] Other Important Information - The company completed a convertible bond offering raising $2.3 billion in gross proceeds [26] - Q4 cash flow generated from operations was $864 million, compared to $627 million in the previous quarter [25] Q&A Session Summary Question: What are the bottlenecks for sales and revenue outlook? - Management acknowledged chip availability and resource constraints from vendors as potential bottlenecks but expects improvements [34][35] Question: What is the strategy for competing in the AI server market? - The focus is on both revenue growth and margin expansion through comprehensive solutions like DCBBS [40][42] Question: Can you discuss the opportunity with Sovereigns? - Management sees significant growth potential in building AI infrastructure for various countries, particularly in Europe and the Middle East [46][49] Question: What is the expected gross margin for the full year? - Management is optimistic about margin improvement through DCBBS and other solutions but did not provide specific forecasts [73][74] Question: What is the expected contribution of DCBBS to revenue? - Management anticipates that DCBBS will gradually grow and hopes it will represent a significant portion of revenue in the future [87][101]

Financial Data and Key Metrics Changes - For fiscal year 2025, the company reported a revenue of $22 billion, reflecting a 47% year-on-year growth [7][20] - Non-GAAP earnings per share decreased to $0.41 from $0.50 year-over-year, primarily due to tariff impacts [8][25] - The fourth quarter revenue was $5.8 billion, up 8% year-over-year and 25% quarter-over-quarter [20] - Non-GAAP gross margin for Q4 was 9.6%, slightly down from 9.7% in Q3, while the full year gross margin was 11.2%, down from 13.9% in the previous year [23][25] Business Line Data and Key Metrics Changes - The enterprise channel segment generated $2.1 billion in Q4, accounting for 36% of revenues, while the OEM appliance and large data center segment contributed $3.7 billion, representing 63% of Q4 revenues [20][21] - For fiscal year 2025, enterprise channel revenues grew 38%, while the OEM appliance and large data center segment grew 50% [21] - The emerging 5G telco edge IoT segment represented only 1% of total revenues in Q4 [21] Market Data and Key Metrics Changes - By geography, the US accounted for 38% of Q4 revenues, Asia 42%, Europe 15%, and the rest of the world 5% [22] - Year-over-year, US revenues decreased by 33%, while Asia saw a 91% increase, Europe increased by 66%, and the rest of the world decreased by 3% [22] Company Strategy and Development Direction - The company is focusing on AI platforms and infrastructure, with a comprehensive portfolio optimized for the latest GPU technologies [10] - The introduction of the Data Center Building Block Solution (DCBBS) aims to simplify customer data center infrastructure and reduce time to market [12][14] - The company is strategically expanding into enterprise IoT and telco markets to improve gross and net margins over time [15][17] Management's Comments on Operating Environment and Future Outlook - Management anticipates revenue between $6 billion and $7 billion for Q1 fiscal year 2026, driven by momentum in AI and software services [18][29] - For fiscal year 2026, the company expects total revenue of at least $33 billion, supported by an expanding customer base and product innovations [18][29] - Management expressed confidence in overcoming previous capital constraints and expects improved chip availability from vendors like NVIDIA [36][38] Other Important Information - The company completed a convertible bond offering raising $2.3 billion in gross proceeds [27] - The cash position at the end of Q4 was $5.2 billion, with a net cash position of $412 million [27] Q&A Session Summary Question: What are the bottlenecks for sales and revenue outlook? - Management acknowledged chip availability and vendor resource constraints as potential bottlenecks but expressed optimism for improved availability [35][36] Question: What is the strategy for competing in the AI server market? - The focus is on both revenue growth and margin expansion through comprehensive solutions like DCBBS [41][43] Question: What is the expected impact of sovereign AI infrastructure opportunities? - Management sees significant growth potential in sovereign AI infrastructure projects, particularly in Europe and the Middle East [44][46] Question: What is the outlook for gross margins in fiscal year 2026? - Management is optimistic about achieving long-term gross margin targets of 14% to 17% through higher-margin enterprise and IoT solutions [64][66] Question: How will the data center building block solutions impact revenue? - Management expects gradual growth in revenue from DCBBS, with potential to represent a significant portion of future sales [101][106]

Financial Performance - Revenue for Fiscal Q4 2025 reached $5757 million, a 25% increase QoQ and an 8% increase YoY[28] - Non-GAAP gross margin for Fiscal Q4 2025 was 96%, a decrease of 10 bps QoQ and 70 bps YoY[28] - Non-GAAP earnings per share for Fiscal Q4 2025 were $041, up $010 QoQ but down $013 YoY[28] - Cash flow from operations was $864 million, up $237 million QoQ but down $1511 million YoY[28] Revenue Mix - Server and Storage Systems revenue was $5618 million, up 26% QoQ and 10% YoY[28] - Subsystems & Accessories revenue was $139 million, down 1% QoQ and 48% YoY[28] Future Outlook - The company projects revenue between $60 billion and $70 billion for FQ1 2026[30] - The company anticipates GAAP diluted net EPS between $030 and $042 and non-GAAP diluted net EPS between $040 and $052 for FQ1 2026[30] - The company expects at least $33 billion in revenue for FY26[30] Strategic Initiatives - The company is targeting ~30%+ of global new data center deployments to use DLC solutions in the next 12 months[10]

Core Insights - Super Micro Computer shares fell 15% in extended trading after disappointing fiscal fourth-quarter results and weak earnings guidance [1] - The company reported a 7.5% increase in revenue for the quarter ending June 30, 2023 [1] Financial Performance - For the current quarter, Super Micro expects adjusted earnings per share between $0.40 and $0.52, with revenue projected at $6 billion to $7 billion, while analysts anticipated $0.59 per share and $6.6 billion in revenue [2] - The company reported adjusted earnings per share of $0.41, which was below the expected $0.44, and revenue of $5.76 billion, also below the expected $5.89 billion [4] Future Outlook - For the fiscal year 2026, Super Micro anticipates at least $33 billion in revenue, exceeding the LSEG consensus of $29.94 billion [2] - Demand for Super Micro's data center servers, particularly those equipped with Nvidia technology for AI workloads, surged in 2023 but has since slowed [3] Market Performance - As of the latest close, Super Micro shares have increased approximately 88% in 2025, significantly outperforming the S&P 500 index, which gained 7% [3] - The company managed to avoid delisting from Nasdaq despite delays in quarterly financial filings and the departure of its auditor [3]

About this content About Angela Harmantas Angela Harmantas is an Editor at Proactive. She has over 15 years of experience covering the equity markets in North America, with a particular focus on junior resource stocks. Angela has reported from numerous countries around the world, including Canada, the US, Australia, Brazil, Ghana, and South Africa for leading trade publications. Previously, she worked in investor relations and led the foreign direct investment program in Canada for the Swedish government ...