Super Micro Computer (SMCI) rose 1.1% Tuesday to close at $33.48, but the stock remains down more than 20% over the past month and is trading at about half its February high.
Despite the recent slide, SMCI is still up nearly 10% this year, a stark contrast to the broader tech sector, which is down almost 15% in 2025.
Supermicro’s pop comes as demand for high-performance computing picks up and PC shipments beat expectations. The optimism is strong enough to overshadow lingering concerns about tariffs and the company’s sketchy accounting.
Industry trends and renewed optimism on Wall Street suggest Supermicro may finally be entering the early stages of a turnaround.
Tariffs or not, demand is growing
Wall Street once expected U.S.-led tariffs to squeeze PC shipments and push companies like Super Micro to overhaul their business models. But those fears now appear overblown, at least for now.
Supermicro is already well-diversified. Beyond PCs, it supplies motherboards, power supplies, chassis, and other infrastructure for high-performance computing.
That’s paid off. According to IDC, global PC shipments rose 4.9% in Q1 2025 versus the same quarter last year, a much-needed surprise to the upside.
Tariffs remain a wildcard, but long-term demand trends — including AI, data center expansion, and even quantum computing — continue to support hardware growth.
A recent report from The Business Research Company forecasts sustained demand for enterprise-level computing infrastructure over the coming years.
JPMorgan estimates that if Trump’s tariff plans move forward, Supermicro would only need to raise prices by about 4%, thanks to its global footprint and relatively limited exposure to affected components.
The bigger risk: Reputation
Supermicro’s most pressing issue isn’t trade policy; it’s credibility.
Last year, the company’s auditor resigned amid concerns about accounting practices. While no wrongdoing has been confirmed, the incident raised red flags for analysts and investors.
CFRA research analyst Shreya Gheewala cited “reputational damage” as a bigger risk than tariffs.
Still, Gheewala recently upgraded SMCI from Hold to Buy, calling it a “higher-risk, higher-reward opportunity” for long-term investors.
Supermicro itself has acknowledged a slower growth outlook for 2025. But the company expects a sharp rebound the following year, forecasting $40 billion in revenue for 2026 — more than $10 billion above current analyst estimates.
“With our leading direct-liquid cooling technology and over 30% of new data centers expected to adopt it in the next 12 months, Supermicro is well positioned to grow AI infrastructure design wins based on Nvidia Blackwell and more,” CEO Charles Liang said in the company’s latest earnings call.
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