Super Micro Computer (SMCI) AI Stock Analysis

• Market Cap: $27.55B
• Dividend Yield: N/A
• Average Volume (3M): 25.89M
• Price to Earnings (P/E): 28.9
• Beta (1Y): 3.18
• Revenue Growth: 47.04%
• EPS Growth: -17.89%
• Country: US
• Employees: 5,684
• Sector: Technology
• Sector Strength: 88
• Industry: Computer Hardware
• EPS (TTM): 0.41
• Shares Outstanding: 594,273,300
• 10 Day Avg. Volume: 25,996,119
• 30 Day Avg. Volume: 25,893,322
• PEG Ratio: -2.41
• Price to Book (P/B): 4.62
• Price to Sales (P/S): 1.32
• P/FCF Ratio: 18.99
• Enterprise Value/Market Cap: 1.10
• Enterprise Value/Revenue: 1.40
• Enterprise Value/Gross Profit: 12.43
• Enterprise Value/Ebitda: 21.89
• 1Y Price Target: $45.53
• Price Target Upside: -5.03% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 17

• Rating: 68 Neutral
• Price Target: $48.00 ▲(0.13% Upside)

Super Micro Computer's overall stock score reflects strong revenue growth and improved cash flow, but is tempered by declining profitability margins and increased leverage. Technical indicators suggest neutral momentum, and the valuation is moderate. The earnings call provided mixed signals with strategic growth initiatives but highlighted challenges in maintaining margins and managing expenses.

Positive Factors

Revenue Growth

Strong revenue growth driven by demand for AI and green computing solutions indicates robust market position and product relevance.

Cash Flow Improvement

Improved cash flow management enhances financial stability and supports future investments and growth initiatives.

International Expansion

Strong international growth diversifies revenue streams and reduces dependency on any single market, enhancing resilience.

Negative Factors

Gross Margin Decline

Declining gross margins indicate cost pressures and may impact profitability if not addressed, affecting long-term financial health.

U.S. Revenue Decline

Significant decline in U.S. revenue highlights challenges in a key market, potentially impacting overall growth and market share.

Rising Debt Levels

Increased reliance on debt financing could strain cash flow and limit financial flexibility, posing long-term risks if not managed.

Super Micro Computer Business Overview & Revenue Model

Company Description

Super Micro Computer, Inc., together with its subsidiaries, develops and manufactures high performance server and storage solutions based on modular and open architecture in the United States, Europe, Asia, and internationally. Its solutions range from complete server, storage systems, modular blade servers, blades, workstations, full racks, networking devices, server sub-systems, server management software, and security software. The company provides application-optimized server solutions, rackmount and blade servers, storage, and subsystems and accessories; and server software management solutions, such as Server Management Suite, including Supermicro Server Manager, Supermicro Power Management software, Supermicro Update Manager, SuperCloud Composer, and SuperDoctor 5. In addition, it offers server subsystems and accessories comprising server boards, chassis, power supplies, and other accessories. Further, the company provides server and storage system integration, configuration, and software upgrade and update services; and technical documentation services, as well as identifies service requirements, creates and executes project plans, and conducts verification testing and technical documentation, and training services. Additionally, it offers help desk and on-site product support services for its server and storage systems; and customer support services, including ongoing maintenance and technical support for its products. The company provides its products to enterprise data centers, cloud computing, artificial intelligence, and 5G and edge computing markets. It sells its products through direct and indirect sales force, distributors, value-added resellers, system integrators, and original equipment manufacturers. The company was incorporated in 1993 and is headquartered in San Jose, California.

How the Company Makes Money

Super Micro Computer generates revenue through the sale of its hardware products, including server systems, components, and related accessories. The company's primary revenue streams include direct sales to large enterprises, cloud service providers, and value-added resellers. Additionally, SMCI earns revenue through service and support contracts, providing maintenance, installation, and consulting services to its customers. Strategic partnerships with major technology companies and suppliers enhance its product offerings and market reach, contributing to its overall earnings. The growing demand for data center solutions and cloud infrastructure has also positively impacted the company's financial performance.

Super Micro Computer Financial Statement Overview

Summary

Super Micro Computer has experienced impressive revenue growth, but profitability margins have been under pressure. The balance sheet shows increased leverage, which could pose risks if not managed carefully. However, the company's cash flow position has improved significantly, indicating strong cash generation capabilities. Overall, while there are areas of concern, particularly with margins and leverage, the company's growth trajectory and cash flow improvements are positive indicators.

Income Statement

Super Micro Computer has demonstrated strong revenue growth over the years, with a significant increase in total revenue from $3.3 billion in 2020 to $21.9 billion in 2025. However, the gross profit margin has decreased from 18.01% in 2023 to 11.06% in 2025, indicating pressure on profitability. The net profit margin has also declined from 8.98% in 2023 to 4.77% in 2025. Despite these margin pressures, the company has maintained a positive EBIT and EBITDA margin, though both have decreased over time.

Balance Sheet

The company's debt-to-equity ratio has increased from 0.027 in 2020 to 0.755 in 2025, indicating a higher reliance on debt financing. However, the equity ratio remains stable, and the return on equity was strong in 2023 at 32.45%, though it dropped to 0% in 2025. The increase in total assets and stockholders' equity over the years reflects growth, but the rising debt levels pose a potential risk.

Cash Flow

Super Micro Computer has shown a remarkable turnaround in cash flow, with free cash flow growing significantly by 4206.90% in 2025. The operating cash flow to net income ratio has improved from negative in 2024 to 0.71 in 2025, indicating better cash flow management. The free cash flow to net income ratio remains strong at 0.92 in 2025, suggesting efficient conversion of earnings into cash.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	21.57B	21.97B	14.99B	7.12B	5.20B	3.56B
Gross Profit	2.43B	2.43B	2.06B	1.28B	800.00M	534.54M
EBITDA	1.38B	1.33B	1.27B	796.05M	335.17M	152.13M
Net Income	1.15B	1.05B	1.15B	640.00M	285.16M	111.86M
Balance Sheet
Total Assets	10.74B	14.02B	9.83B	3.67B	3.21B	2.24B
Cash, Cash Equivalents and Short-Term Investments	2.54B	5.17B	1.67B	440.46M	267.40M	232.27M
Total Debt	2.45B	4.76B	2.17B	290.30M	620.56M	119.05M
Total Liabilities	4.36B	7.72B	4.41B	1.70B	1.78B	1.15B
Stockholders Equity	6.38B	6.30B	5.42B	1.97B	1.43B	1.10B
Cash Flow
Free Cash Flow	35.58M	1.53B	-2.61B	626.79M	-485.98M	64.94M
Operating Cash Flow	154.10M	1.66B	-2.49B	663.58M	-440.80M	122.95M
Investing Cash Flow	-166.81M	-183.21M	-194.25M	-39.49M	-46.28M	-58.02M
Financing Cash Flow	433.56M	2.02B	3.91B	-448.29M	522.87M	-44.44M

Super Micro Computer Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 47.94
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SMCI, the sentiment is Positive. The current price of 47.94 is above the 20-day moving average (MA) of 44.52, above the 50-day MA of 47.07, and above the 200-day MA of 40.95, indicating a bullish trend. The MACD of 0.47 indicates Negative momentum. The RSI at 61.67 is Neutral, neither overbought nor oversold. The STOCH value of 61.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SMCI.

Super Micro Computer Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NTAP	74 Outperform	$23.67B	20.95	120.10%	1.76%	3.45%	9.69%
WDC	74 Outperform	$40.50B	24.20	33.59%	0.17%	2.12%	―
STX	72 Outperform	$48.80B	33.85	-324.28%	1.22%	38.86%	337.22%
SMCI	68 Neutral	$27.55B	28.89	17.90%	―	47.04%	-17.89%
HPQ	66 Neutral	$25.13B	9.79	-209.75%	4.25%	3.11%	-3.54%
PSTG	65 Neutral	$27.25B	205.82	10.55%	―	11.31%	-1.30%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%