Super Micro Computer (SMCI) Appoints A new Auditor, Formally Submits A Compliance Plan To Stave Off A Potential Nasdaq Delisting, And “Delivers Direct-Liquid-Optimized NVIDIA Blackwell Solutions”

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Super Micro Computer (SMCI), one of the leading suppliers of high-performance servers and liquid-cooled AI racks, has finally submitted a plan to regain compliance with the disclosure requirements stipulated by the Nasdaq exchange, paving the way for the embattled company to avoid a catastrophic delisting.

$SMCI NAMES NEW AUDITOR AND FILES WITH NASDAQ, RALLIES TO $25.50 from $17-18 on Thursday/Friday

SUPER MICRO NAMES BDO AUDITOR, SUBMITS PLAN FOR DELAYED FILING

Super Micro Sees Filing Form 10-K for Year Ended June 30 and Form 10-Q for Quarter Ended Sept. 30 Within Discretionary…

— Special Situations 🌐 Research Newsletter (Jay) (@SpecialSitsNews) November 18, 2024

To wit, in a new filing, Super Micro Computer has revealed that its board has appointed BDO USA as the new auditor. Moreover, the company has also submitted a compliance plan to the Nasdaq stock exchange “to support its request for an extension of time to regain compliance with the Nasdaq continued listing requirements.”

The company went on to note:

“In the Compliance Plan, the Company indicated that it believes it will be able to file its Annual Report on Form 10-K for the fiscal year ended June 30, 2024 and its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2024 and become current with its periodic filings within the discretionary period available to the Nasdaq staff to grant.”

Bear in mind that Nasdaq has to formally accept this compliance plan for Super Micro Computer to avoid being booted off the tech-heavy exchange.

$SMCI liquid cooling racks capacity is 18 months to 2 years ahead of $DELL and $HPE. $CSCO is also entering the market, but you can’t build that much capacity overnight (3,000 racks per month)

If only they didn’t fudge up the accounting… $NVDAhttps://t.co/MtLtnGChci

— Special Situations 🌐 Research Newsletter (Jay) (@SpecialSitsNews) November 16, 2024

For the benefit of those who might not be aware, Super Micro Computer’s capacity for deploying liquid-cooled AI racks is currently 18 months to 2 years ahead of its competitors such as Dell, HP, and Cisco. In fact, SMCI was, until recently, NVIDIA’s third-largest customer. However, given the company’s recent troubles, which include allegations of financial impropriety, a preliminary DOJ investigation, the exodus of its second auditor in around 18 months, and a potential de-listing from the Nasdaq exchange, SMCI recently halted the expansion of its major factory in Malaysia, one that would have doubled its production capacity to 10,000 server cabinets per month.

Press Release: Supermicro Delivers Direct-Liquid-Optimized NVIDIA Blackwell Solutions November 18, 2024

Supermicro’s SuperClusters with NVIDIA HGXTM B200 8-GPU, NVIDIA GB200, NVL4, and NVL72 Systems Deliver Unprecedented AI Compute Density $SMCI #SMCI https://t.co/NSVw3RVdOg pic.twitter.com/0brEeCh9I1

— Wolf of My Street🏡 (@Ryan__Rigg) November 18, 2024

In other news, Super Micro Computer just announced the “highest-performing SuperCluster, an end-to-end AI data center solution featuring the NVIDIA Blackwell platform for the era of trillion-parameter-scale generative AI.” SMCI believes that the new SuperCluster significantly increases the number of NVIDIA HGX B200 8-GPU systems that can be deployed within a single liquid-cooled rack.

As we’ve repeated ad nauseam, Super Micro Computer’s latest string of bad luck began in August when Hindenburg Research published a damning report, detailing a litany of malpractices at the firm that ranged from distribution channel stuffing and partial shipments to re-hiring top executives responsible for accounting violations that had already resulted in a $17.5 million settlement with the SEC. Hindenburg Research also alleged that a material proportion of SMCI’s sales came from non-arm’s-length suppliers such as Ablecom and Compuware.

In response to this explosive report, Super Micro Computer delayed the filing of its annual report for FY 2024, presumably in a bid to undertake a comprehensive internal review. Do note that under the prevailing statutory requirements, SMCI’s annual report had to be filed by the 30th of August.

The Nasdaq exchange then warned Super Micro Computer of a potential de-listing action should it fail to file the requisite annual report by the 16th of November.

On the 13th of November, SMCI filed a Form NT 10-Q, explaining that it could not feasibly file its much-delayed annual report by the given deadline as it needed additional time to “select and engage” a successor audit firm following the sudden departure of Ernst & Young (EY) towards the end of October, complete an internal controls assessment, and provide for the successor audit firm to conduct a thorough review of the financial statements pertaining to the FY 2024 and Q1 2025.

Unsurprisingly, given the plethora of good news today, SMCI shares are exploding higher today, currently up 16 percent after having recorded hefty gains during the regular trading session as well.