Super Micro Computer, Inc. (SMCI) saw its stock price soar 16.86% in after-hours trading to $29.80, following an impressive quarterly update. This jump came after the stock had already gained 7.01% during the regular session, closing at $25.50. The rally was driven by solid profitability figures, expanding margins, and a record-setting backlog of orders.
Q3 Financial Results Defy Sequential Revenue Drop
The company's unaudited Q3 fiscal 2026 revenue reached $10.2 billion, a decrease from $12.7 billion in the prior quarter but more than double the $4.6 billion posted in the same quarter last year. Gross margin improved notably to 9.9% compared to 6.3% in the previous quarter, slightly above last year's 9.6%. On a non-GAAP basis, gross margin rose to 10.1% from 9.7% year-over-year.
Net income climbed to $483 million, up from $401 million in Q2. This was a steep increase from $109 million reported in the year-ago quarter. Diluted earnings per share (EPS) reached $0.72, with non-GAAP diluted EPS jumping to $0.84 from $0.31 in the previous year.
Backlog Hits All-Time High, Boosting Q4 Outlook
Super Micro announced its order backlog surpassed $60 billion by fiscal year-end, a record level supporting future delivery schedules. New orders received during Q4 alone exceeded this amount, signaling strong demand momentum.
For Q4, management updated revenue guidance to the lower end of previous estimates, forecasting $11.0 to $12.5 billion. However, gross margin expectations were sharply raised to between 15% and 17%, up from an earlier projection of 8.2% to 8.4%. The improvement attributes to a more favorable customer mix and heightened demand across product lines.
Expansion in AI Infrastructure Enhances Competitive Position
The company expanded its manufacturing footprint with new facilities in Silicon Valley, increasing capacity for AI and enterprise computing hardware production. CEO Charles Liang highlighted the accelerated transformation into a full datacenter infrastructure provider and cited the growth of their Data Center Building Block Solutions business as evidence of resilience.
Liang emphasized that margin recovery and the rapid expansion of their AI-related product lines underpin the firm’s solid business model.
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