Well, that escalated quickly.

Super Micro just dropped its preliminary Q3 numbers, and let’s just say investors are now curled up in the fetal position, muttering in sheer delusion about free cash flow and praying Nvidia doesn’t screw them too. 

(Source: Giphy) 

The San Jose-based server pusher was supposed to print $5.5B in revenue this quarter. That was the number. That was the goal. Instead, they fumbled out $4.5B to $4.6B and earnings of 29 to 31 cents per share. Analysts were expecting 54. Not even close. Not even in the same zip code. And the market punished them for it. Shares cratered 15%. At one point, the stock was almost down 19%. Oof. 

Translation: This is the kind of whiff that exposes how fragile the whole AI server narrative really is. Of course, the company blamed the miss on “delayed customer platform decisions.” which in layman's terms means customers didn’t want to buy a bunch of old-generation GPU servers when they know Nvidia’s Blackwell chips are on the way. You’d stall too if you knew your new AI servers were about to get pummeled by something twice as powerful and half as power-hungry (think: trying to sell iPhone 12s the week before the 15 drops—no bueno). 

(Source: Bloomberg) 

What’s more is that inventory for Super Micro is screaming red flags. Super Micro admitted they’re sitting on a pile of older-generation GPUs, and they had to take heavier inventory reserves. Gross margins dropped 220 basis points quarter-over-quarter. Which is what happens when you’re trying to unload last season’s AI hardware like it’s on clearance at Dollar Tree.

Now, if this was just one bad quarter, Wall Street might shrug and move on. But this is Super Micro we’re talking about—the same company who got murdered by Hindenburg and missed an earnings filing deadline last year so badly they nearly got booted off Nasdaq. The same company that lost Ernst & Young as their auditor because of “governance concerns.” The same company that needed BDO to come in and clean up the financials like a forensic accountant at a crime scene. 

(Source: CNBC) 

And yet, somehow, the company still has the audacity to lean into its $40B revenue forecast for fiscal 2026. That’s almost double the current estimates. That’s a lot of faith in the AI boom continuing at full throttle and in Super Micro’s ability to no f*k it up. Which, frankly, is a big ask. Of course, Charles Liang, the CEO, is still out there pitching 2025 as a repeat of 2023 (read: the year it tripled). But that was before the financial filings went MIA, before the auditor bailed, before the market figured out that “AI infrastructure” doesn’t mean much if you’re just reselling GPUs with a few fans and a logo slapped on the chassis.

On the other hand, SMCI’s nosedive isn’t necessarily about earnings. It’s a huge factor, but it’s also about trust. And Super Micro has burned through most of it. Investors who spent the last six months making AI their entire personality are now on X trying to pretend they were always cautious. Sell-side analysts who were pumping $SMCI like it was the second coming of AWS are now hedging their notes with phrases like “customer timing issues” and “short-term headwinds.”

(Source: Giphy) 

Keep in mind, Super Micro’s entire supply chain relies on high-end GPUs, which means it relies on Nvidia, which relies on TSMC, which relies on Taiwan not getting invaded. Then throw a tariff grenade into the mix, and well, it’s definitely not pretty. And yesterday, Super Micro reminded everyone of the reality most of us have forgotten. 

For now, Super Micro’s full earnings call is on May 6th, so keep an eye on that in case any more skeletons come out of the closet. But until then, place your bets accordingly and stay safe out there. Until next time, friends… 

P.S. Oh, I’m sorry, I didn’t know you liked getting rekt. Let’s face it, retail investors get the short end of the stick all day everyday. It’s the smart money’s world, and we are just living in it–only useful when it comes to liquidity purposes in the market. Meaning, if you’re as pissed off as I was when I found out Milli Vanilli was lip syncing the whole time, then it’s time to go from investing blind, to investing smart. Luckily for you, the key is right here as a Stocks.News premium member. Click here to see exactly how our premium members are printing while others quake in the face of today’s market chaos. 

Stocks.News does not hold positions in companies mentioned in the article.