Super Micro's stock soars as its margins unexpectedly double

By Christine Ji

The AI server maker now expects gross margins to be in the range of 15% to 17% thanks to an improving customer and product mix

Super Micro announces its official fiscal fourth-quarter results on Aug. 11.

Super Micro Computer delivered good news to investors on Tuesday, sharing in its preliminary fiscal fourth-quarter results that the company's gross margins are expected to double from previous guidance.

Shares of Super Micro (SMCI) were surging 19% in after-hours trading. The company expects GAAP and non-GAAP gross margins for the quarter to be between 15% and 17%, roughly doubling from the its prior guidance range of 8.2% to 8.4%. Management attributed the surprise increase to "a favorable customer and product mix."

Demand for the Super Micro's modular data-center solutions appears to be on the rise, as the company shared that it received new orders in excess of $60 billion in the quarter, setting a new record.

The gross-margin figures and record backlog overshadowed the company's announcement that fourth-quarter revenues are estimated to be near the low end of the $11 billion to $12.5 billion guidance range.

The stock's surge marks a turnaround in investor sentiment, as shares of Super Micro have nearly halved since their early June peak. On June 9, the company announced plans to raise $7 billion of equity financing to support a surge in artificial-intelligence server orders, causing the stock to sell off on fears of investor dilution and overspending.

Super Micro's gross margins have been a key focus for investors in recent quarters, as the company has been making an expensive AI pivot and prioritizing capturing market share over profitability. Super Micro aims to evolve from a server designer and manufacturer to a total data-center solutions provider.

Gross margins troughed at 6.3% in the second quarter of fiscal 2026, which CEO Charles Liang attributed to customer mix, tariffs and shortages of key components such as memory products. Gross margins improved slightly in the third quarter, increasing to 9.9%.

The margin recovery signals that Super Micro could be gaining more pricing power with its AI server solutions. On the company's most recent earnings call in May, Liang shared that Super Micro was committed to achieving a sustainable double-digit gross margin by prioritizing the enterprise market and the company's Data Center Building Block Solutions business.

Super Micro has scored major AI customers such as SpaceX (SPCX), with Liang writing in a June post on X that the two companies are co-building a new data center together.

The company announces its official fourth-quarter results on Tuesday, Aug. 11.

-Christine Ji

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07-21-26 1811ET