Supermicro Earnings: Sales Nearly Quadruple to $19.9 Billion, but Margins Thin

Super Micro Computer said on Tuesday, Nov. 3, 2026, that fiscal first-quarter sales almost quadrupled to $19.9 billion, as AI server orders kept arriving. It also raised its outlook for the full year. Shares of the San Jose, Calif.-based server maker rose 9% to 11% after hours, CNBC reported. The Supermicro earnings report also showed weaker profit margins and negative operating cash flow.

Key figures: Q1 FY2027 net sales $19.9 billion (+298%) · net income $1.59 billion · non-GAAP EPS $1.81 (est. $1.23) · gross margin 12.7% · Q2 sales guide $19.5-21.5 billion · FY2027 sales guide $72-82 billion

The quarter

Net sales for the quarter ended Sept. 30 were $19.9 billion, up from $5.0 billion a year earlier and $11.1 billion in the June quarter. Net income rose to $1.59 billion, or $1.75 a diluted share, from $168 million. Adjusted earnings of $1.81 a share beat analysts’ estimate of $1.23.

Gross margin was 12.7%, down from 17.5% in the June quarter but up from 9.3% a year earlier. Operating cash flow was negative $434 million as the company spent on inventory to fill orders. Supermicro ended the quarter with $6.9 billion in cash, against $8.6 billion of debt and convertible notes.

Supermicro earnings by the numbers

Analysis: Supermicro is selling far more, but it keeps less of each dollar than it did last quarter. A 12.7% gross margin on $19.9 billion is about $2.5 billion of gross profit, a TBR calculation, compared with about $1.9 billion on $11.1 billion of sales in the June quarter. Profit dollars still grew, but sales grew faster. The negative cash flow and the debt load show that the growth requires a lot of cash to fund.

Outlook

For the December quarter, Supermicro forecast net sales of $19.5 billion to $21.5 billion. For the fiscal year ending June 2027, it expects $72 billion to $82 billion. The analyst consensus compiled by LSEG had been $69.17 billion, so even the low end of the new range, $72 billion, is above what analysts expected. The midpoint is $77 billion. The company called the first-quarter results preliminary and unaudited.

The results landed alongside other AI hardware reports. CNBC reported that Arista Networks rose about 12% after hours and AMD about 7%, while Skyworks Solutions fell about 16%. We covered AMD’s quarter and its forecast of 97% data center growth in our AMD earnings story, and the buildout of AI networking in our story on the Marvell Lumentum deal.

What to watch

Supermicro buys chips from Nvidia and AMD and sells finished servers and racks to cloud providers and AI companies. That makes it a fast way to gauge Wall Street‘s AI spending trade. Investors will look at whether margins recover and whether cash flow turns positive as the company ships its backlog. Supermicro did not name its largest customers in its release. The company has had problems in the past with its financial reporting and delayed filings, which is one reason investors watch its cash and debt closely. With $8.6 billion of debt and convertible notes against $6.9 billion of cash, it has about $1.7 billion more in borrowings than cash on hand.

Sources

• Supermicro: Supermicro announces first quarter of fiscal year 2027 financial results (Nov. 3, 2026)
• CNBC: Stocks making the biggest moves after hours: Arista, AMD, Supermicro, Skyworks
• Business Wire: Supermicro first quarter fiscal 2027 results
• Stock Titan: Supermicro Q1 fiscal 2027 earnings