Goldman Sachs Reiterates Sell Rating on Super Micro Computer

Goldman Sachs analyst Katherine Murphy reiterated a Sell rating and $27.00 price target on Super Micro Computer (NASDAQ: SMCI).

“SMCI F2Q26 EPS of $0.69 beat (v. GSe/ FactSet consensus $0.50/$0.49) driven by revenue outperformance ($12.7 bn v. GSe/consensus $10.5/$10.4 bn and guidance for $10-$11 bn).

First, gross margins remain under pressure, but EBIT margins benefited from operating leverage. Gross margins in the quarter were slightly softer than expected (6.4% v.

GS/consensus of 6.5%/6.5%) on greater mix to large customers with pricing power & expedited shipping costs, but EBIT margins beat (4.5% v.

GSe/consensus 4.1%/3.9%) on greater operating leverage.

Second, SMCI is seeing broadening demand for its data center infrastructure products.

Although a single customer accounted for 63% of total revenue, or ~$8 bn, in the quarter, SMCI sees broadening demand for its products across a diversified customer base.

DCBBS accounted for ~4% of total company profit for F1H26, with the company guiding for DCBBS to account for at least a double-digit share of profit by the end of C2026.

Third, guidance for F3Q revenue beat, though margins should remain pressured; raised FY revenue outlook on continued demand strength.

F2026 revenue outlook was raised to at least $40 bn in revenue (v. at least $36 bn prior).

While we’re encouraged by the new DCBBS disclosures & robust demand backdrop for AI infrastructure, we remain cautious on the stock given uncertainty around the timing and trajectory of margin improvement (i.e., guidance for gross margins at ~6.7% in F3Q26E are still down ~300 bps year over year), especially given the competitive intensity in the AI server market, upcoming technology transitions (Vera Rubin to ramp in 2H26), and ongoing component shortages.”

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