Key Takeaways
- Super Micro Computer delivered Q4 FY2026 adjusted earnings of $1.70 per share, surpassing analyst forecasts of $1.59 by 7%
- The company’s gross margin reached 17.6%, exceeding expectations by approximately 892 basis points
- Quarterly revenue totaled $11.12 billion, marginally under the $11.26 billion estimate amid delays in customer AI infrastructure projects
- Fiscal 2027 revenue projection of $65B-$72B significantly outpaced Wall Street’s $54.4B forecast
- Multiple firms updated targets: Bernstein lifted to $42, while BofA increased to $33 despite maintaining an Underperform stance
Shares of Super Micro Computer (SMCI) skyrocketed 14% in Tuesday trading following the release of fiscal fourth-quarter 2026 earnings that exceeded profit projections and featured revenue guidance substantially above analyst expectations.
The stock was hovering near $36 throughout the trading session.
Super Micro Computer, Inc., SMCI
The server maker delivered adjusted profits of $1.70 per share for its fiscal fourth quarter of 2026, representing a 7% beat against the Street’s consensus projection of $1.59. Quarterly revenue climbed to $11.12 billion, marking a 9% sequential increase, though falling modestly short of the anticipated $11.26 billion due to postponements in major customer artificial intelligence deployments.
These postponements stemmed from customer infrastructure challenges involving power delivery, thermal management, and network connectivity, resulting in revenue being deferred into the first quarter of fiscal 2027.
The metric that truly captured investor enthusiasm was profitability. SMCI achieved a gross margin of 17.6% in the quarter, exceeding analyst projections by approximately 892 basis points.
This represents a dramatic improvement from the company’s trailing twelve-month gross margin of roughly 10.8%.
Company executives attributed approximately 75% of the quarter-over-quarter margin expansion to advantageous customer and product mix dynamics, which included increased CPU server sales and 50% of total revenue derived from Enterprise and Channel segments. The remaining 25% improvement resulted from reduced tariff expenses and lower inventory reserve requirements.
Artificial intelligence-focused solutions accounted for approximately 60% of fourth-quarter revenue, representing a lower proportion than usual. However, the company’s order backlog indicates that over 80% of upcoming revenue will originate from AI-centric products.
Forward Outlook Significantly Exceeds Projections
Looking ahead to fiscal 2027, SMCI provided revenue guidance ranging from $65 billion to $72 billion. This forecast substantially surpasses the Wall Street consensus estimate of $54.4 billion that existed prior to the announcement.
For the first quarter of fiscal 2027, management projected revenue between $14.5 billion and $15.5 billion compared to analyst expectations of $12 billion. The company’s earnings per share guidance for the period came in at $1.01 to $1.10, well above the Street’s estimate of $0.74.
Additionally, the company disclosed that it secured $60 billion in fresh orders throughout the June quarter.
Wall Street Analyst Response
Bernstein Securities increased its price objective on SMCI to $42 from a previous $37, while maintaining a Market Perform rating. The research firm elevated its fiscal 2027 and fiscal 2028 earnings per share projections to $3.99 and $3.53, up from prior estimates of $2.80 and $3.25 respectively.
BofA Securities boosted its price target to $33 from $28 while retaining an Underperform rating. The firm characterized the fourth-quarter margin performance as unsustainable and highlighted ongoing challenges from competitive dynamics, component pricing pressures, and escalating engineering expenses.
Rosenblatt Securities elevated its target to $51 accompanied by a Buy rating. Needham maintained a Buy rating with a $46 price objective. Mizuho Securities established its target at $35 with a Neutral rating.
BofA Securities further observed that SMCI’s first-quarter gross margin guidance stands at just 10.6% at the midpoint, reflecting a 700 basis point decline from the fourth quarter.
According to InvestingPro data, five analysts have revised their earnings projections upward for the forthcoming period.
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