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Super Micro’s blowout numbers are latest bit of good news for chip industry

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Super Micro Computer Inc. on Thursday delivered the latest upbeat signal for the chip industry.

The company, which is a partner of Nvidia Corp.
NVDA,
+1.88%

and offers servers that run artificial-intelligence chips, expects to report fiscal second-quarter results vastly above the consensus view. Super Micro
SMCI,
-2.13%

issued preliminary quarterly figures Thursday afternoon that call for $3.6 billion to $3.65 billion in net sales, ahead of the $2.8 billion FactSet consensus, which was also the midpoint of the company’s prior outlook.

Opinion (from November 2023): This Nvidia partner has seen its stock surge. But investors may be overlooking a risk.

Super Micro also now expects to post $5.40 to $5.55 in adjusted earnings per share for the December quarter, while analysts had been looking for $4.51 and the company’s earlier forecast called for $4.40 to $4.88.

The company’s release on the matter was brief, calling out “a strong market and end customer demand for our rack-scale, AI and Total IT Solutions” and noting that the company’s earnings call will take place after the close of trading on Jan. 29.

Super Micro shares were up more than 6% in aftermarket action Thursday.

The preliminary results come as the latest bit of good news for the chip sector. Earlier Thursday, Taiwan Semiconductor Manufacturing Co.
TSM,
+9.79%

issued a better-than-expected forecast for the current quarter while giving upbeat commentary on the future of artificial-intelligence chips. TSMC shares surged nearly 10% on the day, and the report helped to lift other chip stocks, including Advanced Micro Devices Inc.
AMD,
+1.56%
,
which finished the session in record territory.

Shares of Super Micro have almost quadrupled over the past 12 months, with the name seen as a play on the artificial-intelligence frenzy. In the fiscal first quarter, Super Micro generated more than half of its revenue from AI-related servers. The company acknowledged supply constraints on its last earnings call.

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