Supermicro Stock Jumps 10% on Doubled Margins and Record AI Backlog

Supermicro stock (SMCI) jumped nearly 10% in after market trading on Tuesday. It follows Super Micro Computer posting a 17.5% quarterly gross margin, almost double last year, and a record order backlog. Less than two years ago, the AI server maker was fighting to keep its Nasdaq listing. Now it projects up to $72 billion in annual sales. Supermicro Stock (SMCI) Performance. Source: Yahoo Finance Why Supermicro Stock Rallied on Doubled Margins Supermicro reported results after Tuesdays close. Net sales reached $11.1 billion for the quarter ended June 30, nearly double the $5.8 billion a year earlier. Yet the margin move stole the show. Gross margin hit 17.5%, up from 9.9% just three months earlier. Net income climbed six-fold to $1.18 billion. Adjusted earnings, which exclude stock-based pay, hit $1.70 per share. That was two and a half times the 68-cent consensus tracked by Zacks. Revenue, meanwhile, landed at the low end of the companys own $11 billion to $12.5 billion target. Thin margins had long been Supermicros weak spot. Big cloud customers squeezed prices, and rivals fought hard for every AI server deal. Tuesdays numbers also push back on fears that AI spending is slowing. As demand accelerates, we are improving profitability through a richer enterprise customer mix and broader adoption of our optimized Data Center Building Block Solutions (DCBBS) architecture, founder and CEO Charles Liang explained the improvement in the earnings statement. Record Backlog Sets Up a $72 Billion Year Supermicro expects $14.5 billion to $15.5 billion in September-quarter revenue, over 30% above the June quarter. Full fiscal 2027 sales should land between $65 billion and $72 billion. The top end sits 84% above fiscal 2026s $39.1 billion. Liang said the company booked over $60 billion in new orders and added several hundred enterprise customers in a year. A July preliminary update flagged the order surge and sent the stock up more than 20% in one day. The order wave matches heavy spending across AI hardware, where Nvidias $500 billion deal has raised demand-quality questions. The rally extends one of the sharpest comebacks in AI hardware. Short seller Hindenburg Research accused the company of accounting manipulation in August 2024. Auditor Ernst Young then resigned, and the shares lost roughly a third of their value in a day. Supermicro filed its delayed reports in February 2025 and kept its Nasdaq listing. That history still shadows the numbers. The results are preliminary and unaudited, and the board is reviewing certain transactions tied to export controls. Inventories nearly tripled to $12.9 billion, and operations consumed $6.8 billion in cash for the year. The rally now rests on one question. Can margins near 17% survive as that backlog turns into shipped systems? The September quarter will offer the first answer.