Super Micro (SMCI) stock is down 17% in after-hours trading after the company shared early results for its third quarter that missed Wall Street expectations. It now expects adjusted earnings of $0.29 to $0.31 per share and revenue between $4.5 billion and $4.6 billion. That’s well below the $0.54 per share and $5.4 billion in revenue that analysts were expecting. The company also lowered its guidance for the quarter, which ended on March 31.
Super Micro explained that some customers delayed decisions about which platforms to use, pushing sales into the next quarter. The company also faced high inventory levels of older products and extra costs from rush shipping fees. These issues reduced its gross margin by 220 basis points compared to the previous quarter. These problems come on top of past issues, including delayed financial filings and the loss of its auditor, Ernst & Young, last year due to governance concerns.
Despite these challenges, Super Micro’s stock had risen 18% in 2025 before this update, due to the excitement around its AI-powered servers using Nvidia (NVDA) chips. However, the stock had previously lost over 80% of its value in late 2023. Nevertheless, CEO Charles Liang is still hopeful, saying earlier this year that 2025 could be as strong as or even better than 2023, if supply chains can meet demand. The company will go over its full results on a conference call scheduled for May 6 at 5 p.m. ET.
Is SMCI Stock a Good Buy?
Turning to Wall Street, analysts have a Hold consensus rating on SMCI stock based on four Buys, five Holds, and two Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average SMCI price target of $47.40 per share implies 31.7% upside potential.
