Key Points
Investors keyed in on rising profit margins in Supermicro's report this week.
The AI boom is still keeping the company busy.
The risk is whether past problems are truly in the past.
- 10 stocks we like better than Super Micro Computer ›
Super Micro Computer (NASDAQ: SMCI) stock has been rallying, which is a big relief for shareholders. Investors have sent shares of the artificial intelligence (AI) server and solutions technology company soaring by more than 50% over the past month, including a 28% gain this week, according to data provided by S&P Global Market Intelligence.
Some of that has been a bounce-back after the company's co-founder, Yih-Shyan "Wally" Liaw, resigned in March following his indictment in a federal investigation concerning the alleged smuggling of technology to China.
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
Earnings this week have investors feeling more optimistic about Supermicro now, though. The question for investors is whether past troubles are truly behind the company.
Image source: The Motley Fool.
Has Supermicro turned the corner?
After a series of internal financial control and auditor questions over the past 18 months, Supermicro had to deal with the accusations against its co-founder this year. Those problems manifested in some lost business, and sales did decline year over year. But in the fiscal Q3 report this week, investors focused on rising margins. That led to increased earnings and sent the stock price soaring.
The business itself has certainly stabilized. Demand for its server and storage data center solutions is high as the AI infrastructure build-out continues. The impact of past problems on its stock may also be behind it. That combination could be offering investors a good opportunity.
The question is whether internal financial control issues were a one-time item or a culture problem within the company. It's a risk I'm not prepared to take, but other investors may be willing.
Should you buy stock in Super Micro Computer right now?
Before you buy stock in Super Micro Computer, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Super Micro Computer wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $475,926!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,296,608!*
Now, it’s worth noting Stock Advisor’s total average return is 981% — a market-crushing outperformance compared to 205% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
*Stock Advisor returns as of May 8, 2026.
Howard Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
