SMCI Surges Over 20% Pre-Market as Delisting Fears Ease

Super Micro Computer has submitted its audited financial results for Q3 and Q4 of 2024 to comply with Nasdaq listing requirements, alleviating market concerns over a potential delisting.

In pre-market trading, Super Micro Computer surged over 20%. 

However, the company warned that despite submitting financial reports, it still faces many risks and challenges related to its previous delinquency in SEC reporting obligations.

As part of the filing, Super Micro disclosed that it had identified material weaknesses in its internal controls over financial reporting. These weaknesses included IT system issues, lack of documentation for manual journal entries, and insufficient controls to ensure proper segregation of staff duties. The company stated that it is taking corrective actions, including hiring additional accounting and audit personnel and upgrading its IT systems.

Additionally, in Tuesday's filing, Super Micro stated that a special committee of its Board, which reviewed its financial statements, did not believe that Ernst & Young's resignation was "supported by the facts" examined by the committee.

Notably, Super Micro has built a strong partnership with Nvidia, and at one point, its stock outperformed Nvidia's. With Nvidia set to report earnings after today's U.S. market close, investors are keenly watching whether AI infrastructure demand remains strong— a crucial driver of Super Micro's business.