(Reuters) – Super Micro Computer (SMCI) on Tuesday forecast first-quarter revenue that beat analysts’ estimates and announced a 10-for-1 stock split after its shares rose as Wall Street bets heavily on the future of generative AI technology.
Shares of the San Jose, California-based company jumped 12% in extended trading. Shares of AI leader Nvidia rose 4%, while Arm Holdings gained 2.6% after the results.
The company’s stock price has more than doubled since the start of the year, driven by a months-long rally in AI-related stocks as investors poured billions of dollars into genAI technology.
Trading will begin on a split-adjusted basis on October 1, 2024.
Super Micro is a major beneficiary of increased spending on advanced data center architecture that supports genAI’s complex processing needs.
Super Micro’s results could also help ease some concerns that the AI rally is running out of steam, after disappointing results from big cloud providers like Microsoft and weak macroeconomic data sparked a selloff in chip stocks last week.
The company expects net revenue of $6 billion to $7 billion for the first quarter, compared with analysts’ average estimate of $5.46 billion, according to LSEG data.
(Reporting by Arsheeya Bajwa in Bengaluru)
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