Super Micro Computer (SMCI) has announced a 10-for-1 stock split along with disappointing second-quarter financial results.
The company, which makes high-efficiency servers that run artificial intelligence (AI) applications and models, said that its stock will begin trading on a split-adjusted basis Oct. 1.
The split will lower Super Micro Computer’s share price from $616.94 U.S. to $61.69 U.S. based on where the stock currently trades.
Super Micro Computer is the latest in a series of companies to split its stock this year.
Microchip designers Nvidia (NVDA) and Broadcom (AVGO) each split their stocks on a 10-for-1 basis in recent months.
Unfortunately, news of the stock split came with Q2 financial results that sent Super Micro Computer’s stock plunging 14% in pre-market trading.
The Silicon Valley-based company reported earnings per share (EPS) of $6.25 U.S., which badly missed Wall Street’s consensus target of $8.07 U.S.
Revenue in the April through June quarter totaled $5.31 billion U.S. compared to $5.30 billion U.S. that was forecast.
Super Micro Computer also said that its gross margin dropped to 11.2% from 17% a year earlier. A lower margin means the company is earning less profit on each product it sells.
Looking ahead, Super Micro Computer said that it expects revenues of $6 billion U.S. to $7 billion U.S. for the current third quarter. That’s ahead of analyst estimates of $5.46 billion U.S.
However, an earnings outlook of $5.59 U.S. to $8.27 U.S., or a $7.48 U.S. at the midpoint, is below consensus estimates of $7.58 U.S. registered on Wall Street.
Prior to today (Aug. 7), Super Micro Computer’s stock had risen 116% this year to trade at $616.94 U.S. per share, making it the top-performing stock in the S&P 500 index.
Super Micro Computer’s stock has surged as investors buy into the AI trade and bet that the company will become an essential vendor of servers for Nvidia’s microchips.
