Supermicro (SMCI) projects $36B revenue despite Q1 profit dip
Key Points
- Revenue: $5.02 B (vs $5.94 B YoY) ▼ 15% YoY, ▼ 14% QoQ
- GAAP EPS: $0.26 (vs $0.67 YoY) ▼ 61%
- Non-GAAP EPS: $0.35 (vs $0.73 YoY) ▼ 52%
- Gross Margin: 9.3% GAAP / 9.5% non-GAAP (vs 13.1% YoY)
- Net Income: $168 M (vs $424 M YoY)
- Operating Cash Flow: –$918 M (outflow)
- Cash & Equivalents: $4.2 B
- Total Debt: $4.8 B
Management Commentary
- Charles Liang, CEO: “Powered by our DCBBS architecture, Supermicro is transforming into a leading AI and datacenter infrastructure company.
With a rapidly expanding order book—including over $13 B in NVIDIA Blackwell Ultra orders—we expect at least $36 B in FY 2026 revenue.” Liang highlighted ongoing scaling in AI server capacity and broader deployment of liquid-cooled and rack-level AI solutions.
Outlook
- Q2 FY26 (Dec 2025 quarter)
- Revenue: $10.0 B – $11.0 B
- GAAP EPS: $0.37 – $0.45
- Non-GAAP EPS: $0.46 – $0.54
- Assumes ~16% tax rate and ~680 M diluted shares
- FY 2026 Full-Year Target: ≥ $36 B in revenue
Financial Summary
| Metric | Q1 FY26 | Q4 FY25 | Q1 FY25 | YoY Change |
|---|---|---|---|---|
| Revenue | $5.02 B | $5.76 B | $5.94 B | –15% |
| GAAP EPS | $0.26 | $0.31 | $0.67 | –61% |
| Non-GAAP EPS | $0.35 | — | $0.73 | –52% |
| Gross Margin | 9.3% | 9.5% | 13.1% | –3.8 pts |
| Net Income | $168 M | $195 M | $424 M | –60% |
AI-Related Highlights
- $13 B+ Blackwell Ultra AI server backlog.
- Expanding Direct Liquid Cooling (DLC-2) systems for high-density AI workloads.
- Scaling customer base across hyperscale cloud, enterprise, and sovereign AI segments.
- Positioning to capture next wave of AI datacenter infrastructure growth.
Key Takeaways
- Profitability compressed on lower margins and cash outflow despite solid backlog.
- Management projects sharp sequential rebound in Q2 on AI-server ramp.
- Focus remains on AI infrastructure leadership via DCBBS and liquid-cooling platforms.
- FY26 target implies >6× growth vs FY25 revenue base—ambitious but order-driven.