Shares of Super Micro Computer (SMCI) plummeted over 15% on Wednesday.
The AI-focused server maker sharply cut its third-quarter guidance, delivering a blow to investor confidence already shaken by past controversies. SMCI now expects revenue between $4.5 billion and $4.6 billion, well below its previous forecast of up to $6 billion and far short of Wall Street’s $5.35 billion consensus. Adjusted earnings are projected to land between $0.29 and $0.31 per share, down from the previously guided range of $0.46 to $0.62.
The company blamed the shortfall on delayed customer platform decisions, citing a transition in demand from Nvidia’s (NVDA) older Hopper GPUs to the upcoming Blackwell processors. As a result, sales that had been anticipated for Q3 appear to have slipped into Q4, further clouding near-term visibility.
But many investors aren’t buying the delay narrative. SMCI’s credibility has already taken a hit following last year’s accounting concerns and the resignation of its auditor. Although the firm avoided delisting from the Nasdaq in February, Wednesday’s revised guidance sparked fresh doubts, leading to target price cuts from Barclays, JPMorgan (JPM), and Mizuho, who warned of competitive pressure from Dell and HPE and a shrinking technological moat.
SMCI stock is now more than 50% below its 2024 highs, and while some analysts see upside potential long-term, the immediate outlook remains murky.
Qorvo Surprises to the Upside — Again
In contrast, Qorvo (QRVO) delivered a fourth-quarter performance that outpaced expectations, sending shares surging more than 10% in early trading. The chipmaker reported adjusted EPS of $1.42, crushing the $1.01 consensus, on revenue of $869.5 million, slightly ahead of the $850 million estimate.
While sales declined 7.6% year over year, the company expanded gross margins by 160 basis points and posted a significant jump in GAAP net income — up from just $0.03 per share a year ago to $0.33. Free cash flow also remained robust at $171 million for the quarter and $485 million for the full year.
Qorvo’s CEO Bob Bruggeworth called the performance “stronger than seasonal,” though the future remains uncertain. Management guided for just $775 million in revenue for the next quarter, a 13% year-over-year decline, and warned of ongoing macroeconomic headwinds and possible tariff-related disruptions.
Despite this, investors appear optimistic. Qorvo’s 12x price-to-free cash flow ratio and a consistent track record of earnings beats have drawn attention, especially in a semiconductor segment where reliable outperformance is hard to find.
In contrast, Qorvo (QRVO) delivered a fourth-quarter performance that outpaced expectations, sending shares surging more than 10% in early trading. The chipmaker reported adjusted EPS of $1.42, crushing the $1.01 consensus, on revenue of $869.5 million, slightly ahead of the $850 million estimate.
While sales declined 7.6% year over year, the company expanded gross margins by 160 basis points and posted a significant jump in GAAP net income — up from just $0.03 per share a year ago to $0.33. Free cash flow also remained robust at $171 million for the quarter and $485 million for the full year.
Qorvo’s CEO Bob Bruggeworth called the performance “stronger than seasonal,” though the future remains uncertain. Management guided for just $775 million in revenue for the next quarter, a 13% year-over-year decline, and warned of ongoing macroeconomic headwinds and possible tariff-related disruptions.
Despite this, investors appear optimistic. Qorvo’s 12x price-to-free cash flow ratio and a consistent track record of earnings beats have drawn attention, especially in a semiconductor segment where reliable outperformance is hard to find.
Diverging Fortunes in the AI Hardware Race
The latest results illustrate a growing divergence among hardware companies riding the AI wave. While Qorvo is executing well despite industry headwinds, Super Micro’s revised outlook raises concerns that demand for AI infrastructure may not be as bulletproof as some believed — or at least, not evenly distributed across players.
In the fast-moving, highly cyclical world of semiconductors and high-performance compute hardware, the ability to guide accurately and execute consistently is critical. With customer buying patterns shifting and competition intensifying, the pressure is on — especially for those still trying to rebuild trust.
SMCI and QRVO may both serve the broader AI ecosystem, but this week, only one seems to be delivering on expectations.
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