Super Micro stock tumbles on $7 billion financing plans

Super Micro Computer Shares tumbled 9% in extended trading Tuesday after the computer server maker announced it would enter into equity-related financing deals to help cover the cost of hardware component purchases.

company in question It plans a $5 billion underwritten stock offering and a $2 billion to-market offering starting in July. JPMorgan Chase, Goldman Sachs And citigroup. Companies often see their share prices fall after announcing stock sales, as investors prepare to see the value of their existing holdings decrease.

Super Micro is the latest company tied to the AI ​​boom to turn to financial markets for more capital. earlier this month AlphabetThe company, which provides artificial intelligence models and cloud infrastructure for model builders like Anthropic, said it would sell $85 billion worth of shares, including a $10 billion investment. Berkshire Hathaway.

Super Micro said Tuesday that it has received $39 billion in AI server orders from more than 20 customers in the past few weeks. Demand for AI-ready servers is growing rapidly, and Super Micro’s revenue in the March quarter jumped over 100% year-on-year. Dell He said revenue from the Infrastructure Solutions Group increased 181% compared to last year.

Before the post-corporate decline, Super Micro shares were up nearly 39% so far this year. In March, the company announced that a co-founder had resigned from its board of directors after he was named in a federal indictment over allegations of equipment smuggling that included: Nvidia Artificial intelligence chips are entering China.

Super Micro CEO Charles Liang told analysts on the company’s May earnings report that the cost of memory has more than tripled in recent months.

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