Super Micro's Stock Enjoys Near-Historic Surge Upon Nvidia Fervor

Nvidia talked up massive growth ahead in data-center infrastructure

Super Micro is an Nvidia partner.

After a 700%-plus rally over the past year, Super Micro Computer Inc. is headed to the bank with a new planned convertible-debt offering, but that wasn’t getting in the way of the stock’s momentum Thursday.

Super Micro shares rose nearly 33% in Thursday trading, riding a wave of enthusiasm in the chip sector after Nvidia Corp. delivered blowout results and guidance, while predicting that the good times could continue for years. Server maker Super Micro is an Nvidia partner and got a shoutout on the company’s earnings call.

The stock gains were Super Micro’s second-best on record, behind only the 35.9% surge seen Jan. 19, which came after the company delivered upbeat preliminary results.

In fact, Super Micro’s Thursday stock rally was far greater than even Nvidia’s 16.4% run, and well above other notable ones across the semiconductor sector. For example, Arm Holdings PLC shares gained more than 4%, Advanced Micro Devices Inc. shares rose more than 10% and Marvell Technology Inc. shares advanced more than 6%.

The iShares Semiconductor ETF was up 4.9% in Thursday’s action and logged a new high.

Nvidia not only posted huge growth in its latest quarter and forecast the same for its current one, but it also talked up big potential in the data-center market going forward.

“We are now at the beginning of a new industry where AI-dedicated data centers process massive raw data to refine it into digital intelligence,” Chief Executive Jensen Huang said on Nvidia’s earnings call. The company sees the potential for the installed base of data-center infrastructure to double over the next five years — and hit $2 trillion.

Super Micro makes liquid-cooling technology, which analysts see as increasingly important given the amount of power consumed by artificial-intelligence workloads.

Super Micro’s stock bucked the company’s overnight announcement that it was proposing a $1.5 billion convertible-debt offering of notes that mature in 2029. Convertible offerings are ultimately dilutive as they eventually are converted into stock, but the impact for Super Micro wouldn’t be as dramatic given the sharp run-up in the stock lately.

While Super Micro shares rocketed Thursday and are up sizably over a one-year span, they’d pulled back somewhat over recent sessions and thus snapped a three-day losing streak that had seen them fall 27% through Wednesday’s close.