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Super Micro Computer (NASDAQ: SMCI) stock soared about 20% in after-hours trading on Tuesday after the AI server maker released a stronger-than-expected preliminary update for its fiscal fourth quarter, highlighting a sharp improvement in profitability and record customer demand.
Although Supermicro expects fourth-quarter revenue to come in near the lower end of its previous guidance of $11 billion to $12.5 billion for the quarter ended June 30, 2026, investors focused on the company’s significantly improved margins and robust order pipeline.
The company now estimates GAAP and non-GAAP gross margins between 15% and 17%, far above its earlier forecast of 8.2% to 8.4%. Management attributed the stronger profitability to a more favorable mix of products and customers, signaling better execution and higher-value AI infrastructure sales.
The improved margin outlook helped shift investor attention away from softer revenue expectations, reinforcing confidence in Supermicro’s ability to capitalize on the expanding artificial intelligence infrastructure market.
Supermicro also disclosed that its order backlog reached a record high at the end of fiscal 2026. During the fourth quarter alone, the company secured approximately $60 billion in new orders, creating a substantial pipeline of future deliveries that management expects to fulfill over the coming quarters.
The record backlog underscores continued demand for AI servers and high-performance computing systems, areas that have become major growth drivers as enterprises and cloud providers expand AI deployments.
The strong after-hours rally suggests investors are placing greater emphasis on Supermicro’s improving profitability, healthy margins, and long-term AI demand rather than short-term revenue performance.
Market participants will receive a clearer picture of the company’s financial position when Super Micro Computer reports its full fourth-quarter and fiscal 2026 results on August 11. The earnings release and conference call, scheduled for 5:00 p.m. EDT, are expected to provide additional details on revenue, margins, customer demand, and the outlook for AI infrastructure spending, which remains one of the key themes driving technology stocks in 2026.
