To The Moon

Supermicro has officially surpassed $AMD in quarterly sales as hyperscalers accelerate AI data centre buildouts, and price action confirms investors are repricing infrastructure providers as core beneficiaries of the AI capex cycle.

◾ AI server demand continues surging across hyperscaler and enterprise deployments

◾ Infrastructure spend is capturing a growing share of AI budgets

◾ Index inclusion and scale effects amplified institutional momentum

◾ Energy efficiency and rack level optimisation now matter as much as raw silicon performance

Momentum is shifting from experimental AI spending toward full scale deployment. Infrastructure is now the bottleneck, and $SMCI sits directly in that liquidity pocket.

📊 Q2 Results Snapshot, AI Demand Explosion

$SMCI delivered a blockbuster fiscal Q2, reinforcing its central role in the AI infrastructure boom:

📊 Adj. EPS: $0.69 vs $0.49 expected 🟢

💰 Revenue: $12.68B vs $10.42B expected 🟢

📈 Net Income: $0.40B

🔎 AI server demand drove record revenue growth alongside expanding manufacturing capacity

Shares jumped 11.44% in the earnings reaction session and held gains, closing near $34.38 as investors rotated back into infrastructure winners despite profitability debates. Over the past week the stock climbed 15.72% as confidence in AI deployment demand strengthened.

Revenue surged 123% YoY, confirming $SMCI is capturing a major share of global AI data centre deployment. AI platforms now account for the vast majority of revenue mix.

Sequential acceleration also stands out. Revenue jumped from roughly $5.0B in the prior quarter to $12.7B, showing hyperscalers are rapidly deploying large AI clusters at scale rather than testing capacity incrementally.

Operating cash flow temporarily turned negative at $(941.4)M as working capital expanded to fund inventory and receivables for rapid scaling. Importantly, management secured a new $2B revolving credit facility, ensuring liquidity support for continued expansion.

🏭 Building Block Strategy Driving Adoption

$SMCI’s modular Building Block architecture and leadership in liquid cooling solutions are becoming critical differentiators as AI racks grow denser and energy constraints tighten globally.

Customers increasingly need rapid deployment plus energy efficient infrastructure, not just chips. $SMCI’s ability to customise and ship integrated AI ready racks quickly gives it a strong competitive edge in the current deployment cycle.

📈 Guidance Raises The Demand Floor

Management lifted full year revenue expectations to at least $40B, up from prior expectations near $36B, signalling sustained order strength rather than a one off spike.

Forward guidance also implies continued momentum, with Q3 revenue expected above $12.3B, reinforcing that hyperscale AI infrastructure deployment is accelerating, not slowing.

🏦 Institutional Flow Turning Supportive

Recent filings show continued accumulation from asset managers and pension funds even during broader market weakness.

Smart money appears positioned for continued AI infrastructure expansion rather than trading short term volatility. Infrastructure investments typically run in multi year cycles once deployment commitments are made.

🎯 Analyst Sentiment Remains Divided

Street opinion remains mixed, creating volatility but also opportunity as expectations recalibrate:

• Rosenblatt reiterates Buy with $50 target

• Needham maintains Buy near $40

• Barclays maintains Equalweight around $38

• Raymond James cautious near $35

• Mizuho raises target to $33 as demand improves

• Goldman Sachs maintains Sell near $27

• KeyBanc remains Hold

Consensus remains Hold with average targets implying moderate upside, meaning further gains now depend on management converting explosive revenue growth into sustainable margin expansion.

Bullish analysts highlight $SMCI’s rapid AI production ramp and expanding one stop data centre platform. Higher margin offerings like Datacenter Building Block Solutions could improve profitability over time.

Bearish analysts warn gross margins remain thin near 6.4%, pressured by price sensitive hyperscale buyers, logistics costs, competition and heavy working capital needs.

📊 Technical Structure, 4H Regime Shift

The 4H chart shows trend exhaustion followed by structure recovery:

• Multi week downtrend stalled into higher low formation

• Price reclaimed EMA clusters signalling regime transition attempt

• Bollinger and Keltner bands expanding, volatility regime turning higher

• Break above $33 unlocked upside liquidity pockets into mid $30s

Holding above this reclaimed zone keeps recovery momentum intact.

⚡ Intraday Structure, 30 Minute Momentum

Short term flow now supports continuation:

• Higher low intraday sequence forming

• EMA 13, 21 and 55 alignment turning supportive

• Price riding upper volatility bands signals momentum expansion

• Liquidity cleared above $34 opens path toward resistance near $36 to $40

Short term flow now aligns with intermediate recovery structure.

🌍 Macro Regime Supports Infrastructure Expansion

AI infrastructure is increasingly viewed as strategic investment across major economies. Data centre expansion, energy optimisation and sovereign compute capacity are becoming national priorities.

This macro regime supports sustained infrastructure deployment even if semiconductor cycles periodically cool.

⚡ Final Take

I’m seeing infrastructure leaders begin capturing flows alongside chip names as AI spending matures into global deployment.

$SMCI’s explosive revenue growth, renewed institutional accumulation and improving price structure show markets recognising servers and deployment scale matter as much as silicon innovation.

Volatility remains elevated, but structure and flow suggest infrastructure leaders deserve close attention as the AI infrastructure supercycle unfolds.

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