SMCI Stock Alert: Top Analysts Cut Price Targets Amid Margin Concerns and Delayed Orders

Super Micro Computer (SMCI) has received multiple price target cuts from top Wall Street analysts due to its dismal Q3FY25 performance and lowered Fiscal 2025 outlook. Analysts have cited concerns over margin impacts and delayed orders from Nvidia's Blackwell chips. Despite this, some analysts remain optimistic about SMCI's future growth prospects, driven by demand for advanced GPUs. SMCI's stock currently has a Moderate Buy consensus rating based on six analyst ratings.

Ask Aime: "Why is Super Micro Computer's stock facing a Moderate Buy consensus despite price target cuts?"

Super Micro Computer Inc. (NASDAQ: SMCI) has seen its stock price slide after receiving multiple price target cuts from top Wall Street analysts. The downward trend follows the company's dismal third-quarter financial performance and a significantly downgraded fiscal 2025 revenue outlook. Analysts have cited concerns over margin impacts and delayed orders from Nvidia's Blackwell chips as key reasons for the cuts.

The company's stock dropped nearly 6% in midday trading on Wednesday, adding to last week's post-earnings selloff. Super Micro's stock has fallen over 60% in the past 12 months. The stock's downward trajectory comes amidst growing pressure to deliver under increasingly uncertain economic conditions.

Super Micro's updated guidance puts full-year revenue for fiscal 2025 between $21.8 billion and $22.6 billion, a significant downgrade from the prior range of $23.5 billion to $25 billion. CEO Charles Liang attributed the revised forecast to customer hesitation stemming from macroeconomic uncertainty and new global tariffs, including President Trump's 10% levy on U.S. semiconductor imports.

The company's gross margins are expected to hover around 10%, well below the 14% reported in fiscal 2024 and 18% in 2023. The combination of inventory discounting, supply-chain constraints, and intensifying competition in the AI server market has taken a toll on SMCI's profitability.

Following the earnings call, analysts were quick to adjust their expectations. Nehal Choksi of Northland Securities slashed his Street-high target from $70 to $59, citing weaker guidance and longer ramp times for Nvidia's Blackwell chips. Matt Bryson of Wedbush trimmed his target from $40 to $30, warning of short-term downside as Super Micro navigates through tariff disruptions and customer delays. Kevin Cassidy from Rosenblatt Securities reduced his target from $55 to $50, highlighting the $1 billion in delayed shipments that are now expected to be recognized across the June and September quarters.

According to TipRanks, Super Micro now holds a Moderate Buy consensus rating, based on 6 Buys, 5 Holds, and 2 Sells. The average price target of $38.67 implies nearly 19% upside from current levels, but that's cold comfort to investors watching the stock fall over 60% in the past 12 months.

Super Micro's stock is facing a critical moment as once-rosy growth projections run into the harsh reality of tariff headwinds, volatile demand, and intense market competition. While long-term prospects tied to AI infrastructure remain strong, Super Micro's short-term path is clearly more uncertain than it was just a few months ago. Investors and analysts alike will be watching closely in the coming quarters to see whether Super Micro can bounce back—or whether the cracks in its AI story run deeper than expected.

References:
[1] https://gondwanauniversity.org/smci-stock-slides-as-analysts-slash-price-targets-amid-margin-pressure-order-delays-and-tariff-concerns/

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