An eager market was excitedly waiting for Super Micro Computer (NASDAQ:SMCI) to share a preliminary update regarding its Q2 2025 performance last Tuesday.
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While SMCI’s revenues were clearly an item of interest, a big storyline that emerged was the company’s expression of confidence that it remains on track to submit its audited financials by the February 25th deadline required to avoid being delisted by the Nasdaq stock exchange.
Investors, of course, were still anxious to review the numbers. CEO Charles Liang announced that the company’s Q2 revenues are projected at a range of $5.6 billion to $5.7 billion, which represents a 54% year-on-year growth.
Going forward, the company is shooting for $40 billion in revenues in FY 2026, which would represent significant growth from the $23.5 billion to $25 billion that the company is projecting for FY 2025.
The market seems to have been impressed, and shares have jumped up over 20% in the days since last week’s conference call.
However, investor Oliver Rodzianko is not convinced that the bullish sentiment is entirely warranted.
“Management’s $40B FY26 revenue guidance shows optimism, but supply chain delays and tough competition could undermine bullish assumptions for SMCI stock,” explains the 5-star investor.
Looking at the Q2 numbers, Rodzianko points out that the company’s FY 25 guidance was actually revised downward, with the $23.5 billion to $25 billion coming in under the previous estimates of $26 billion to $30 billion. The investor notes that lowering these expectations “is not a good sign for future reports.”
Rodzianko is also concerned about the $40 billion revenue projection for the following year. The investor continues that stiff competition from Dell and Hewlett Packard Enterprise, slowing growth from the AI market, and supply chain issues could derail these high hopes.
In addition, Rodzianko reminds investors that the company is not out of the woods yet when it comes to the Nasdaq.
“The greatest risk remains the potential Nasdaq delisting,” Rodzianko spells out. “The failure to execute on this will result in substantial stock price losses.”
Rodzianko is rating SMCI a Hold (i.e. Neutral), concluding that the likelihood of a “bull-case outcome” is on the low end of the spectrum. (To watch Rodzianko’s track record, click here)
Wall Street, on the other hand, seems to be cautiously optimistic about SMCI, with 3 Buy, 2 Hold, and 1 Sell making it a consensus Moderate Buy. The recent uptick could have overshot some of these bullish assessments, however, as its 12-month average price target of $38.40 would lead to losses of ~20%. (See SMCI stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
