How did SMCI's revenue and expenses trend in Q2 2025 compared to previous quarters?

Super Micro Computer Inc (SMCI) experienced a significant decline in revenue and a slight increase in expenses in Q2 2025 compared to the previous quarter and the same quarter in the previous year.

1. Revenue Trend:
   • In Q2 2025, SMCI's revenue was $4.60 billion, which is a decrease from the $5.68 billion reported in the previous quarter (Q3 2024) but an increase from the $3.85 billion in Q2 2024.
   • The company's guidance for Q4 2025 projects a potential revenue range of $5.6 billion to $6.4 billion, which is below the analyst consensus.
   • Fiscal year 2025 revenue guidance has been lowered to a range of $21.8 billion to $22.6 billion, down from the previous forecast of $23.5 billion to $25.0 billion.

2. Expense Trend:
   • Gross Margin: The gross margin decreased to 9.6% in Q2 2025, down from 11.8% in the previous quarter (Q3 2024) and 15.5% in the same quarter last year (Q2 2024).
   • Cash Flow from Operations: Despite the revenue challenges, SMCI reported a strong cash flow from operations of $627 million.
3. Comparison with Guidance and Analyst Estimates:
   • SMCI's revenue in Q2 2025 missed the analyst estimate of $5.05 billion.
   • The company's EPS in Q2 2025 was $0.31, which beat the analyst estimate of $0.30.

In summary, SMCI faced a challenging quarter with revenue declining from the previous quarter but increasing year-over-year, and gross margins under pressure. However, the company showed strong operational cash generation.