AI Server Maker Super Micro Raises Quarterly Sales Forecast to $19.5 Billion, Stock Jumps 17%

Shares of US-based AI server manufacturer Super Micro Computer (NASDAQ: SMCI) surged as much as 17% in extended trading on Tuesday after the company raised its revenue forecast for the September quarter to $18.5 billion–$19.5 billion, up from its previous guidance of $14.5 billion–$15.5 billion. This adjustment implies a midpoint increase of approximately 26.7% over the original estimate and nearly 279% growth year-over-year. Management attributed the upgrade primarily to stronger demand for AI platforms and an improved product and customer mix, which lifted gross margin expectations from 10.4%–10.8% to 12%–12.5%.

Despite the optimistic revenue outlook, the market remains cautious about profitability quality. Based on the new guidance midpoint, additional gross profit would be around $738 million, but this margin level still trails the 17.5% recorded in the June quarter, highlighting how profitability varies with customer and equipment mix. A more critical concern is cash flow: Super Micro reported $39.1 billion in fiscal 2026 revenue but used approximately $6.81 billion in operating cash, resulting in negative free cash flow of roughly $7 billion. Growing server sales require large upfront purchases of expensive chips and components, often before customers settle invoices, leading to ballooning working capital needs.

Analysts noted that some growth could reflect market-share shifts or the fulfillment of previously acquired components rather than an equivalent acceleration in industry-wide spending. Dell Technologies and Hewlett Packard Enterprise also rose in after-hours trading, suggesting investors viewed the announcement as evidence of broader demand for AI infrastructure. However, Wall Street consensus remains 'Hold' with targets ranging from $15 to $60. Investors will await full earnings on November 3 to verify whether the sales surprise translates into sustainable operating cash flow and profits, particularly given the risk of customer concentration, with one buyer accounting for 28.1% of revenue in fiscal 2026.