Super Micro Computer (NASDAQ:SMCI) posted fiscal second-quarter results that beat street forecasts on both earnings and revenue, but the company did not win over all market watchers. Following the release, Goldman Sachs reiterated a Sell rating and held its $27.00 price target, citing several factors that temper enthusiasm even after the quarter’s strong top-line performance.
Quarterly performance and outlook
The company reported earnings per share of $0.69 for fiscal Q2 2026, above Goldman Sachs' estimate of $0.50 and the FactSet consensus of $0.49. Revenue came in at $12.7 billion, outperforming the company’s prior guidance range of $10.0 billion to $11.0 billion and exceeding analyst forecasts. Management raised its fiscal 2026 revenue outlook to at least $40.0 billion, up from a prior target of at least $36.0 billion, pointing to continued robust demand for AI infrastructure.
Those top-line gains were driven in part by ramped production of the GB300 system, a complex product line that Rosenblatt characterized as "one of the most complicated systems ever produced." The quarter’s revenue represents a substantial year-over-year increase, reflecting material operational scale-up tied to AI server demand.
Margins and profitability
While revenue and operating leverage showed strength, gross profits remained under pressure. Gross margin for the quarter registered at 6.4%, slightly below the 6.5% expectation noted by analysts. Goldman Sachs attributed the slight shortfall to a higher mix of very large customers with greater pricing power and to expedited shipping costs. Operating margin outperformed expectations, coming in at 4.5% versus a 4.1% estimate, reflecting favorable operating leverage on the larger revenue base.
Additional data highlighted in research notes emphasize an ongoing margin challenge: last twelve-month (LTM) gross profit margins were reported at just 8.02%. These figures underpin caution among some sell-side analysts despite the company’s elevated growth trajectory.
Customer concentration and demand breadth
Management disclosed that one customer accounted for approximately 63% of quarterly revenue, equal to roughly $8.0 billion for the period. Company commentary stressed that demand is broadening beyond that single large account, but concentration at that scale remains a central consideration for investors assessing revenue stability and negotiating leverage.
Analyst reactions and valuation dispersion
Market reactions among analysts were mixed. Rosenblatt reaffirmed a Buy rating and kept a $50.00 price target. Barclays adjusted its target down to $38.00 from $43.00 but maintained an Equalweight rating; the company’s December quarter revenue exceeded Barclays’ estimate by more than $2.0 billion. Overall, analyst price targets cited in research span a wide range, from $15 to $93, reflecting divergent views on competitive dynamics, margin recovery timing, and the company’s ability to sustain growth while improving profitability.
Stock performance and valuation context
The stock has experienced significant volatility, with a roughly 49% decline over the last six months according to available market data. Despite solid revenue expansion of 34.76% over the prior twelve months and the recent uplift to guidance, some valuation models indicate the shares are trading below assessed Fair Value.
Conclusion
Super Micro’s fiscal Q2 report delivered both upside and unresolved questions. Revenue strength and an upgraded fiscal-year target signal healthy demand for AI server systems, while compressed gross margins, heavy customer concentration, and supply-side dynamics leave room for skepticism. That combination helps explain why certain firms, including Goldman Sachs, remain cautious on the shares even as others maintain bullish stances.
Data points cited in this report
- Fiscal Q2 EPS: $0.69
- Goldman Sachs EPS estimate: $0.50; FactSet consensus: $0.49
- Quarterly revenue: $12.7 billion
- Company guidance for fiscal 2026 revenue: at least $40.0 billion (raised from at least $36.0 billion)
- Gross margin for the quarter: 6.4% (vs. 6.5% expected)
- Operating margin for the quarter: 4.5% (vs. 4.1% expected)
- Single customer share of quarterly revenue: 63% (about $8.0 billion)
- Last twelve-month revenue growth: 34.76%
- LTM gross profit margin: 8.02%
- Six-month stock decline: approximately 49%
- Analyst price target range cited: $15 to $93