Why SMCI plunged before NVDA earnings?
$ Super Micro Computer (SMCI)$ fell more than 8% on Aug. 26 as the market worried about two factors.The main reasons are as follows.
1. Stock split still to take place
SMCI previously announced that it would be doing a 1:10 stock split, and while the stock was trading at over $1,000 at the time, it is now trading at just over $500.Many investors are concerned that a stock split at the current price would not necessarily benefit the company.As market sentiment moves further downward, it may be possible to achieve a "lower price" without a split.
2. NVDA's Blackwell delay.
The decline in SMCI's share price may be related to the big drop in NVIDIA's share price over the same period.
NVIDIA' s (NVDA) shares fell after Citibank lifted its "catalyst watch" rating and lowered its earnings estimates, mainly due to Blackwell delays.
According to Charles Liang, CEO of Super Micro Computer Inc (SMCI), speaking on the earnings call, the delay of NVIDIA's Blackwell AI GPUs had little overall impact on SMCI.
SMCI is ready to deploy and deliver new H200-based products to customers and will not be significantly impacted.
Even with Blackwell's delayed availability, SMCI will see initial sales in the December quarter, with the real peak in sales expected in the March quarter of 2025
Existing H200 products are expected to see significant growth in the second half of 2024, with orders expected to increase by 57%.This means that even if Blackwell shipments are delayed, Supermicro will still be able to sustain revenue growth with its existing product lines
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I’m holding SMCI at 600. Can’t understand the drop. What a night.