Super Micro Computer (SMCI) stock continued its rebound Friday, with shares on track to record a weekly gain of 78%.
Shares of Super Micro — the AI server maker that uses Nvidia’s (NVDA) chips and has a major deal with Elon Musk’s xAI — rose over 11% in Friday trading to roughly $33. Even with that gain, shares are still far below highs above $120 in March following SMCI’s addition to the S&P 500.
The stock’s rally kicked off Monday in anticipation of Super Micro’s submission of a compliance plan to the Nasdaq (^IXIC) as it looks to avoid delisting. Shares skyrocketed when the company officially announced it had submitted the plan and hired a new auditor, BDO. Super Micro’s prior accountant, Ernst & Young, resigned in late October.
Super Micro has been grappling with the fallout from an August report by short seller firm Hindenburg Research, which pointed to alleged accounting malpractices, violations of export controls, and shady relationships between top executives and Super Micro partners. Following the Hindenburg report, Super Micro delayed filing its annual 10-K and most recent quarterly 10-Q reports to the Securities and Exchange Commission, which put the company at risk of being delisted from the Nasdaq. Super Micro is also reportedly being investigated by the Department of Justice.
The deluge of bad news has sent shares tumbling over the last few months. EY’s resignation, in particular, pushed Super Micro stock down more than 30% in a single day in late October. The accountant wrote in its resignation letter that it was “unwilling to be associated with the financial statements prepared by [Super Micro] management.”
Adding to its woes, Super Micro’s fiscal first quarter earnings report on Nov. 5 missed Wall Street’s expectations. As Wedbush analyst Matthew Bryson wrote in a note to investors at the time, the company blamed lighter sales on delays of Nvidia’s Blackwell AI chips and issues with its SEC filings. Bryson maintains a Neutral rating on the stock and recently lowered his price target for shares to $24 from $32.
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