Super Micro Computer’s SMCI shares climbed 16% in the pre-market hours on July 22 after the company released a preliminary business update for the fourth quarter of fiscal 2026, reporting more than $60 billion in new orders during the quarter. The company said these orders are expected to be delivered over future quarters and that its backlog reached a record level at the end of fiscal 2026.
The company now expects a gross margin of 15% to 17% for the fourth quarter, up from its previous guidance of 8.2% to 8.4%, primarily due to a favorable customer and product mix. Super Micro Computer also estimated that fourth-quarter revenues will be near the low end of its previously issued guidance of $11 billion to $12.5 billion.
Super Micro Computer is one of the first companies to bring new AI servers to market, including systems built on NVIDIA’s GB300 NVL72, HGX B300 and RTX6000Pro platforms, as well as AMD MI350/355 systems. This early availability gives Super Micro Computer a big edge in a fast-moving AI market. Customers who need powerful computing systems quickly for AI training and inference are more likely to choose Super Micro Computer.
The company is also preparing for next-generation NVIDIA, AMD, Intel and ARM AGI CPU platforms. Being first with new technologies helps it win large orders and build stronger customer relationships. This “time-to-market” advantage sets Super Micro Computer apart from traditional server makers like Dell and HPE, who typically move slowly. The company is already delivering these systems in high volumes worldwide.
Super Micro Computer’s DCBBS simplifies how data centers are built. It combines servers, racks, power systems, cooling and networking into a complete package. This helps customers save up to 30% in total costs and build data centers faster, sometimes in weeks instead of months. The offering includes the company’s latest liquid cooling technology (DLC-2), which reduces power and water use. DCBBS also includes software and support so that customers don’t have to manage multiple vendors.
Super Micro Computer’s deep penetration in handling AI workloads is likely to continue driving its top-line growth. SMCI derives a major portion of its revenue from AI-focused systems. These include servers built to handle GPU-heavy workloads needed for training and running AI models. AI GPU-related platforms contributed more than 80% of third-quarter fiscal 2026 revenues. This shows that the company has become a top vendor for AI infrastructure.
How Competitors Fare Against SMCI
Big players like Hewlett Packard Enterprise HPE and Dell Technologies DELL are competing with SMCI in this space.
Dell Technologies is a major supplier of servers and storage systems, with a broad customer base across enterprises and cloud providers. Its scale, established distribution and service offerings give it an edge in winning large contracts. However, Dell Technologies has not grown as quickly as SMCI in AI-specific systems; its ability to bundle hardware with services makes it a strong rival.
Hewlett Packard Enterprise is also expanding aggressively into AI and high-performance computing. Its GreenLake platform provides customers with flexible, cloud-like consumption models, which can be attractive to enterprises. Hewlett Packard Enterprise’s focus on hybrid cloud and AI workloads positions it as a direct competitor in areas where SMCI is seeking growth through its DCBBS strategy.
Hewlett Packard Enterprise offers a range of servers, including HPE ProLiant, HPE Synergy, HPE BladeSystem and HPE Moonshot servers. Dell Technologies has built the Dell AI Factory in collaboration with NVIDIA. Dell Technologies also collaborated with Red Hat Enterprise Linux AI for Dell PowerEdge servers.
SMCI’s Price Performance, Valuation and Estimates
Shares of Super Micro Computer have lost 12.9% year to date compared with the Zacks Computer – Storage Devices industry’s growth of 242.3%.
SMCI YTD Performance Chart
Image Source: Zacks Investment Research
From a valuation standpoint, SMCI is trading at a discount at a forward 12-Month P/S multiple of 0.3X compared with the industry’s P/S multiple of 3.81X.
SMCI Forward 12-Month (P/S) Valuation Chart
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Super Micro Computer’s fiscal 2026 and 2027 earnings implies a year-over-year increase of approximately 24.27% and 25.9%, respectively. Earnings estimates for fiscal 2026 have been revised downward in the past seven days.
Image Source: Zacks Investment Research
Super Micro Computer currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).