Super Micro Computer reported fiscal Q1 revenue of $5.02 billion, falling 17.5% short of consensus projections and missing its own guidance range of $6 billion to $7 billion. Gross margin contracted to 9.3%, down from 13.1% a year earlier, and management warned of another 300 basis-point decline in Q2 as production ramps for the GB300 Blackwell platforms. Despite these misses, the company raised its full-year revenue target to at least $36 billion, citing an expected pickup in AI workload demand during the back half of the fiscal year.

Supermicro’s modular server architecture and partnerships with Nvidia have driven AI-optimized GPU systems to represent over 75% of Q1 revenue. The company’s time-to-online offerings, including liquid-cooled rack designs and its DCBBS high-density systems, have attracted hyperscale customers and enterprises seeking rapid deployment. Order backlog exceeded $13 billion at quarter end, reflecting strong demand for next-generation GPU solutions that support both training and inference workloads.

Competition from Dell Technologies and Hewlett Packard Enterprise has intensified pricing pressure, limiting Supermicro’s margin recovery prospects. Analysts project full-year gross margin of just 7.5%, compared with over 15% in 2022, as input costs rise and GPU shortages persist. Last week, Goldman Sachs initiated coverage with a Sell rating and a one-year target implying further downside based on restricted profitability visibility and potential supply-chain disruptions. Two consecutive quarters of revenue and earnings misses have undermined investor confidence, with shares off nearly 40% over the past three months.