Super Micro Computer (SMCI) stock fell nearly 5% in Wednesday’s pre-market trading after the company reported weaker-than-expected third-quarter results and sharply lowered its full-year revenue outlook.
SMCI posted Q3 revenue of $4.6 billion, which, while up 19% year-over-year, missed analyst expectations by a wide margin. Adjusted earnings per share came in at $0.31, also below consensus.
The main catalyst for the selloff was management’s revised guidance for fiscal 2025 revenue, now forecast at $21.8 billion to $22.6 billion-down from the previous range of $23.5 billion to $25 billion. This reduction reflects customer delays in platform decisions, growing economic uncertainty, and the impact of new US tariffs introduced by the Trump administration.
The tariffs are affecting Supermicro’s global manufacturing operations, including facilities in Taiwan and the Netherlands, and could extend to semiconductors, a critical component for its servers.
CEO Charles Liang acknowledged that some clients have postponed purchases due to the uncertain environment, while CFO David Weigand warned of continued gross margin pressure, now expected around 10%, down from over 14% last year.
The company’s Q4 guidance also came in below Wall Street estimates, further fueling investor concerns about near-term growth.
Despite robust demand for AI infrastructure and ongoing expansion in international markets, the combination of a revenue miss, cautious outlook, and external headwinds from tariffs and competition led to the pre-market decline in SMCI shares.
Investors are now watching closely to see if delayed customer orders and new product launches can help the company regain momentum in the coming quarters.