Super Micro sees quarterly revenue soaring on AI server boom

Oct 20 (Reuters) - Super Micro ‌Computer expects quarterly ​revenue ​and profit margin well above Wall Street estimates as it benefits from relentless AI data center demand, the server ‌maker said on Tuesday, sending shares 11.3% higher in ⁠after-hours trading.

Rivals Dell and HPE gained between 3.5% and 4.9%. Nvidia, the AI chip ‌giant, was up 1.5%.

Big Tech's ‌race to build out data centers has placed firms such as Super Micro among the biggest beneficiaries of the AI boom. ​Microsoft, Google, Amazon and Meta are expected to spend more than $700 billion on AI infrastructure this year.

That is showing up in Super ⁠Micro's results.

FORECAST FOLLOWS AI SELLOFF

Shares of companies exposed to the AI data-center buildout fell last ​week after CoreWeave’s stock and bond slide and prospects of higher interest rates triggered concerns that heavily indebted ​operators could take longer than expected to ‌generate returns.

S&P Global said on Monday it estimates the world's biggest tech firms are likely to have more ⁠AI-linked liabilities than known.

Super Micro on Tuesday said it expects revenue between $18.5 billion and $19.5 billion in the first quarter, compared with analysts’ average estimate of $15.23 ⁠billion, according to data compiled by LSEG. That expectation is also well above ​the company’s prior revenue forecast of $14.5 billion to $15.5 billion.

The server maker also now expects gross margins to be in the range of 12% to 12.5% versus ‌the prior expectation of 10.4% to 10.8%, and above analysts' estimate of 10.15%, primarily due to customer and ‌product mix.

Super Micro last week appointed former Western Digital executive Mark Long ⁠as its chief financial officer, ‌nearly two years after ​beginning its search amid scrutiny of its financial and accounting practices.

(Reporting by Pragyan Kalita in Bengaluru; Editing by ‌Sahal Muhammed)

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