Super Micro Stock Surges on Decision to Maintain Nasdaq Listing

Shares of Super Micro Computer (SMCI) surged 31% on Tuesday, November 19, following the appointment of BDO as its new auditor, investors are optimistic that this move signals the company is taking crucial steps to maintain its listing on the Nasdaq Exchange.

SMCI stock has increased by more than 50% in the past two trading days, yet it is still significantly below its all-time high of $122.90.

Super Micro's shares soared more than 20 times their value between early 2022 and their peak in March, when the stock was added to the S&P 500 index. However, the share price has since suffered due to concerns over potential delisting from the Nasdaq related to its accounting practices. Let’s take a closer look at SMCI’s recent gains.

Super Micro’s New Plan

On Monday, November 18, Super Micro's stock rose approximately 16% after the company, a partner with Nvidia (NVDA) in providing advanced servers powered by AI chips and a recent supplier for Elon Musk's xAI, met a deadline set by the U.S. SEC. This deadline allowed Super Micro six weeks to submit a compliance plan.

Super Micro stated that its plan highlights progress toward submitting overdue filings to the SEC, aiming to regain compliance with its periodic reporting obligations within the timeframe permitted by Nasdaq.

Timeline of Events: Super Micro Computer

Following a series of significant events in 2024, the question remains: can Super Micro maintain its status as an AI darling on Wall Street?

July: Ernst & Young (EY) raises concerns regarding Super Micro's governance, transparency, and internal controls over financial reporting.
August 27: Hindenburg Research discloses a short position, alleging "accounting manipulation" by Super Micro.
September 17: Nasdaq notifies Super Micro of non-compliance with listing rules, granting the company 60 days to file its annual report or present a compliance plan.
October 30: EY resigns as Super Micro's auditor, leading to a 55% drop in the stock price.
November 5: Super Micro, based in San Jose, California, revises its sales targets for the September and December quarters in a business update.
Early November: A special committee investigating EY's concerns finds no evidence of fraud.
November 13: Super Micro announces a delay in filing its financial report for the September quarter as it works to appoint a new auditor and evaluate internal controls for the fiscal year ending June 30, 2024.

Conclusion: Will Super Micro Stay Listed on the Nasdaq?

With a new auditor now appointed, Super Micro is positioned to submit its Form 10-K annual report for the fiscal year ending June 30 and its Form 10-Q quarterly report for the first quarter ending September 30.

This development has alleviated some investor concerns about the company’s future, as reflected in this week's stock price increase.

However, it remains uncertain whether Super Micro can regain the trust lost due to its late filings and the allegations of accounting manipulation raised by Hindenburg. Only time will tell.

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Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be construed to be investment advice.