Super Micro Shares Tumble 13% as Second Quarter Sales Outlook Misses Estimates
$Super Micro Computer (SMCI.US)$ shares tumbled 13% in extended trading Tuesday after the company gave a fiscal second quarter sales outlook that missed analysts' estimates.
That company expects net sales to reach $5.5 billion to $6.1 billion for the quarter ending Dec. 31, trailing Bloomberg consensus that called for $6.79 billion. Adjusted earnings could reach 56 cents to 65 cents, lower than the 80 cents expected by analysts.
Super Micro said a special committee has completed its investigation based on the initial concerns raised by its auditor Ernst and Young and is "recommending a series of remedial measures for the Company to strengthen its internal governance and oversight functions."
Last week, the company disclosed that its auditor Ernst & Young resigned after receiving additional information that "raised questions, including about whether the company demonstrates a commitment to integrity and ethical values."
"We can no longer provide the Audit Services in accordance with applicable law or professional obligations,”EY said in its resignation letter that was quoted in a filing with the Securities and Exchange Commission on Oct. 30. It said EY received information that“led us to no longer be able to rely on management's and the Audit Committee's representations and to be unwilling to be associated with the financial statements prepared by management.”
In a press release Tuesday, the company said the committee found that "there is no evidence of fraud or misconduct on the part of management or the Board of Directors."
Nasdaq notified Super Micro in September of its non-compliance to the exchanges listing rule that requires the timely filing of its annual report on form 10K for the fiscal year ended June 30. Under that rule, SMCI has 60 days to file its form 10-K.
The company said Tuesday it plans to take all necessary steps to comply with the Nasdaq rule to ensure it keeps its listing in the exchange.
While the annual report has yet to be filed, the company reported preliminary numbers for its fiscal first quarter that ended Sept. 30. It said it expects to report adjusted earnings of 75 cents to 76 cents, compared with its previous guidance that called for 67 cents to 83 cents. Analysts on average, were expecting 74 cents for that period, according to estimates compiled by Bloomberg.
Preliminary net sales were seen at $5.9 billion to $6 billion, lower than the $6.47 billion expected by analysts.
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Former editor at Bloomberg, ex-commentary editor at Lazard. Posts aren’t investment advice. Views are just mine.
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71824460 : Is this a buy?? Or stay away type of stock? Thanks
MAVA : Split - stay in but stay very small
71435396 : Any company in which their integrity is in question is never a good investment especially from an accounting perspective. I sold all my shares
Mooalong : more bad news coming for smci, like delisting from NASDAQ. I would stay away.
72641346 : I did the climb and sold and 12:59
Zach Bennett181 71824460 : Stay tf away
White_Shadow : not looking good, yet has so much potential
Mooalong : why not buy smci's competitor like DELL. smci is a broken stock/ merchandise.
74754703 71824460 : Buy
74754703 PaulG : Buy*
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