Financial Data and Key Metrics Changes - Super Micro achieved record revenue of $12.68 billion in Q2 FY 2026, representing a 123% year-over-year growth and a 153% quarter-over-quarter increase, exceeding guidance of $10 billion to $11 billion [6][16] - Non-GAAP gross margin for Q2 was 6.4%, down from 9.5% in Q1, impacted by customer and product mix, as well as higher freight and production costs [18] - GAAP operating expenses were $324 million, up 14% quarter-over-quarter and 8% year-over-year, while non-GAAP operating expenses were $241 million, up 18% quarter-over-quarter and 6% year-over-year [19] Business Line Data and Key Metrics Changes - The enterprise channel revenue segment totaled $2 billion, representing about 16% of revenue, down from 31% in the prior quarter, but up 42% year-over-year [17] - The OEM appliance and large data center segment revenue was $10.7 billion, representing approximately 84% of Q2 revenue, up from 68% in the last quarter, and up 151% year-over-year [17] Market Data and Key Metrics Changes - By geography, the US represented 86% of Q2 revenue, Asia 9%, Europe 3%, and the rest of the world 2% [17] - Year-over-year, US revenue increased 184%, Asia grew 53%, Europe decreased 63%, and the rest of the world increased 77% [18] Company Strategy and Development Direction - The company is focusing on the development of its Data Center Building Block Solution (DCBBS) to enhance profitability and customer value, expecting DCBBS to contribute significantly to profits by the end of calendar 2026 [9][10] - Super Micro is expanding its global manufacturing footprint, with new production sites in Taiwan, Malaysia, and the Netherlands, to optimize cost structure and support regional AI requirements [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the demand for AI and IT infrastructure, indicating that the DCBBS solution is well-positioned to meet customer needs for faster and more efficient data center builds [13] - The company guided for at least $12.3 billion in revenue for Q3 FY 2026 and raised full-year revenue guidance to at least $40 billion, reflecting a conservative estimate considering supply constraints [14][25] Other Important Information - Cash flow used in operations for Q2 was $24 million, a significant improvement from $918 million used in the prior quarter, with a closing inventory of $10.6 billion [21] - The company has expanded access to working capital through a $2 billion cash flow-based secured revolving credit facility and a $1.8 billion secured Taiwan revolving debt facility [21] Q&A Session Summary Question: Margin Improvement Expectations - Management indicated that customer mix is improving and that gross margins are expected to improve quarter-over-quarter due to reduced expedite transportation costs and tariff impacts [28] Question: Full-Year Guidance Clarification - Management stated that the $40 billion guidance is conservative and that business is expected to continue growing, particularly with the DCBBS attracting more customers [37] Question: Component Shortages Impact - Management acknowledged that component shortages are a significant factor but emphasized that demand is strong, which is a positive sign for growth [61] Question: Customer Mix and DCBBS Adoption - Management noted that DCBBS is appealing to a wide range of customers, including large, medium, and small-scale data center builders, indicating a broad market appeal [63] Question: Future Customer Diversification - Management expressed optimism about increasing customer diversification, with a focus on both large and mid-sized enterprise customers [81]

Financial Data and Key Metrics Changes - Q1 fiscal year 2026 revenue was $5 billion, down 15% year-over-year and down 13% quarter-over-quarter, compared to guidance of $6 billion-$7 billion [15] - Non-GAAP gross margin for Q1 was 9.5% versus 9.6% in Q4 [17] - GAAP diluted EPS was $0.26 compared to guidance of $0.30-$0.42, and non-GAAP diluted EPS was $0.35 versus guidance of $0.40-$0.52 [18] - Cash flow used in operations for Q1 was $918 million compared to cash flow generated from operations of $864 million in the prior quarter [18] - Q1 closing inventory was $5.7 billion, up from $4.7 billion in Q4 [18] Business Line Data and Key Metrics Changes - AI GPU platforms represented over 75% of Q1 revenues, continuing to be the key growth driver [15] - Enterprise channel revenues totaled $1.5 billion, representing 31% of revenues, down from 36% in the prior quarter [15] - OEM appliance and large data center segment revenues were $3.4 billion, representing 68% of Q1 revenues, up from 63% in the last quarter [16] Market Data and Key Metrics Changes - By geography, the U.S. represented 37% of Q1 revenues, Asia 46%, Europe 14%, and the rest of the world 3% [16] - Year-over-year, U.S. revenues decreased 57%, while Asia grew 143% [16] - Asia's growth was attributed to a U.S.-based customer opening a large data center in Asia [16] Company Strategy and Development Direction - The company is focused on leading the AI growth trend with innovative solutions, including the DCBBS [7] - The DCBBS is critical for future success, enabling rapid planning, design, and deployment of AI-ready data centers [9] - The company is executing an aggressive global expansion, with new production facilities in Taiwan, the Netherlands, Malaysia, and soon the Middle East [11] - The long-term goal is to expand revenues in higher margin segments such as data center building block solutions and software service offerings [21] Management's Comments on Operating Environment and Future Outlook - Management expects to ship at least $10.5 billion in the December quarter, with a full-year revenue outlook raised to at least $36 billion [14][22] - The company anticipates a sequential growth through fiscal 2026, driven by strong demand for AI infrastructure [14] - Management acknowledged the challenges of ramping production and the complexities of new GPU racks impacting revenue timing [8][15] Other Important Information - The company executed a $1.8 billion AR facility to strengthen working capital [19] - The Q1 cash conversion cycle was 123 days, up from 96 days in Q4 [19] - Capital expenditures for Q1 totaled $32 million, resulting in negative free cash flow of $950 million for the quarter [18] Q&A Session Summary Question: What is driving the increased revenue guidance? - Management indicated that the availability of NVIDIA Blackwell Ultra chipsets is a key driver for increased revenue guidance, alongside market share expansion [26] Question: When will DCBBS impact gross margins? - DCBBS has received positive feedback, and management expects it to ramp up quickly, contributing to higher profit margins in the future [28] Question: What components contribute to the strong order outlook? - The strong order outlook is driven by GPU products like Blackwell Ultra and AMD MI350, along with a focus on providing end-to-end data center solutions [32] Question: Is there conservatism in the revenue guidance? - Management confirmed that the revenue guidance is conservative, with expectations for continued growth as capacity and technology mature [42] Question: How is the company managing working capital? - The company has implemented an accounts receivable sale program to enhance working capital flexibility, especially as revenues double [56] Question: What is the status of the Malaysia plant? - The Malaysia plant is starting to ramp up production and is expected to contribute significantly going forward [51] Question: How does the company plan to improve margins? - Management is focused on leveraging additional business, expanding manufacturing in various geographies, and enhancing DCBBS strategies to improve margins [75]

Financial Data and Key Metrics Changes - Q1 fiscal year 2026 revenue was $5 billion, down 15% year over year and down 13% quarter over quarter, compared to guidance of $6 billion-$7 billion [14] - Non-GAAP gross margin for Q1 was 9.5% versus 9.6% in Q4 [17] - GAAP diluted EPS was $0.26 compared to guidance of $0.30-$0.42, and non-GAAP diluted EPS was $0.35 versus guidance of $0.40-$0.52 [18] - Cash flow used in operations for Q1 was $918 million compared to cash flow generated from operations of $864 million in the prior quarter [18] - Q1 closing inventory was $5.7 billion, up from $4.7 billion in Q4 [18] Business Line Data and Key Metrics Changes - AI GPU platforms represented over 75% of Q1 revenues, continuing to be the key growth driver [15] - Enterprise channel revenues totaled $1.5 billion, representing 31% of revenues, down from 36% in the prior quarter [15] - OEM appliance and large data center segment revenues were $3.4 billion, representing 68% of Q1 revenues, up from 63% in the last quarter [15] Market Data and Key Metrics Changes - By geography, the US represented 37% of Q1 revenues, Asia 46%, Europe 14%, and the rest of the world 3% [16] - Year-over-year, US revenues decreased 57%, while Asia grew 143% [16] - Asia's growth was attributed to a US-based customer opening a large data center in Asia [16] Company Strategy and Development Direction - The company is focused on leading the AI growth trend with innovative solutions, including the DCBBS [6] - The DCBBS is critical for future success, enabling rapid planning, design, and deployment of AI-ready data centers [9] - The company is executing an aggressive global expansion, with new production facilities in Taiwan, the Netherlands, Malaysia, and soon the Middle East [11] - The long-term goal is to expand revenues in higher margin segments such as data center building block solutions and software service offerings [21] Management's Comments on Operating Environment and Future Outlook - Management expects to ship at least $10.5 billion in the December quarter, with a full-year revenue outlook raised to at least $36 billion [13][24] - The company anticipates sequential growth through fiscal 2026, driven by strong demand for AI infrastructure [13] - Management acknowledged the complexity of new GPU racks causing revenue shifts from Q1 to Q2, but believes this will strengthen growth trajectory [7] Other Important Information - The company executed a $1.8 billion AR facility to strengthen working capital [19] - Q1 GAAP operating expenses were $285 million, down 10% quarter-over-quarter [17] - The company is investing in expanding its DCBBS portfolio and upcoming releases [10] Q&A Session Summary Question: What drives the increased revenue guidance? - Management indicated that the availability of NVIDIA Blackwell Ultra chipsets and market share expansion are both key drivers for increased revenue guidance [27] Question: When will DCBBS impact gross margins? - Management noted that DCBBS has been well received and is expected to ramp up quickly, with higher profit margins anticipated in the data center infrastructure sector [28] Question: What contributes to the strong order outlook? - Management highlighted that GPU products, including Blackwell Ultra and AMD MI350, are significant contributors to the strong order outlook [32] Question: Is the December quarter the low watermark for gross margins? - Management confirmed that the December quarter is expected to have lower margins due to ramping up new product lines, but improvements are anticipated in future quarters [46] Question: How does the company account for revenue push-outs? - Management acknowledged that large projects often face timing challenges due to logistics and customer readiness, which can impact quarterly results [75]