Jim Cramer Critiques Super Micro Computer's Earnings Update

Jim Cramer, the host of CNBC’s "Mad Money," has voiced strong criticism of Super Micro Computer Inc (SMCI) regarding its recent business update and preliminary earnings results for the first quarter.

What Happened: Cramer shared his concerns on X, saying, "Super Micro is so good at exonerating itself, better than it is selling NVIDIA GPUs!" This comment reflects his disappointment with the company's performance.

Super Micro’s recent announcement indicated that for the first quarter, it anticipates revenue between $5.9 billion and $6 billion, which is a reduction from its earlier guidance of $6 billion to $7 billion. Furthermore, the company expects to post adjusted earnings per share in the range of 75 cents to 76 cents, slightly above the previous estimate of 67 cents to 83 cents.

The company’s gross margin for the first quarter is projected to be about 13.3%. Looking ahead, Super Micro is forecasting second-quarter revenue to be between $5.5 billion and $6.1 billion, with adjusted earnings of 56 cents to 65 cents per share.

Why It Matters: Super Micro has faced scrutiny regarding its financial integrity, primarily due to serious governance issues. The resignation of their independent auditor, Ernst & Young, raised alarms about governance and transparency, leading to a significant drop in the company's stock. In response to these challenges, Super Micro has been attempting to stabilize its operations.

Price Action: Following these updates, Super Micro Computer Inc. closed at $27.70, reflecting a 6.42% gain for the day. However, during after-hours trading, the stock experienced a sharp decline of 15.88%. Overall, year-to-date, shares of Super Micro are down approximately 2.98%, as reported by market data.

The context of Cramer's critique emphasizes the ongoing challenges Super Micro faces, especially in its attempt to restore investor confidence.

Cramer, Earnings, Company