Super Micro Computer Inc. has returned to Nasdaq compliance. Wall Street hasn’t given it any more attention.
Because Super Micro was in danger of delisting as a result of its delayed financial disclosures, some analysts have discontinued coverage of the company’s shares (SMCI). Vijay Rakesh, an analyst at Mizuho Securities, resumed covering the stock on Friday but declined to recommend it because of the company’s fiercer competition in the market for AI servers.
He has set a $50 price objective for the stock and a neutral rating.
Rakesh wrote in a note to clients, “We believe overall Super Micro remains well positioned,” noting that the company has priority component allocations for servers for the enterprise and sovereign sectors. However, the business also has to contend with a “more competitive landscape with peers Dell Technologies Inc. (DELL) and Wistron Corp. (TW:3231),” both of which are headquartered in Taiwan.
As competition increases, he predicted that Super Micro’s market share of servers worldwide will be about 23% in 2025, down marginally from 25% in 2024.
According to Rakesh, Super Micro “maintained a good product portfolio and strong overall AI server market growth,” indicating that it had “limited impact” from its compliance concerns. Additionally, he noted that although Super Micro’s inclusion in its audited statements after an extension met Nasdaq’s listing standards, the business still “needs work” on its internal controls.
With the top two customers accounting for almost 58% of Super Micro’s December quarter revenues, he also noted that the company’s customer concentration may pose a problem in the future.
Rakesh said that he thinks Super Micro’s recent sales projection of $40 billion for fiscal 2026 “could be optimistic given increased competition and slow Blackwell ramps,” a reference to the latest-generation chip platform from Nvidia Corp. (NVDA). Mizuho projects that Super Micro will make $34.3 billion in fiscal 2026 and $38.9 billion in fiscal 2027.
In early trade, Super Micro’s stock was down a small amount. The company avoided delisting and met its compliance deadline this week, and they had one of their finest months ever, surging 50% in February.
