Just a Dude Who Invests
Retail Investor, Economics & Technology Commentary
Super Micro Computer looks like a fraud, and the earlier alarm raised on it is being borne out. x.comÂ
Super Micro Computer is not worth the risk regardless of its business or multiple, given early signs of sketchy business that have now escalated. Per @WOLF_Financial, its co-founder was charged with smuggling about $2.5B of servers with Nvidia AI chips to China via a Southeast Asian shell company, using fake paperwork and dummy servers to fool the compliance team. x.comÂ
Super Micro should benefit as data centers buy the servers that house Nvidia's AI chips. Its quarterly sales outlook rose from $15B to $19B; the stock is 36% below its high and trades at 8x next year's earnings. It is a double from here. x.com x.comÂ
Super Micro Computer is not to be trusted given its continued history of accounting fraud, and there are far better investments without that risk. The stock just dropped below $30 after smuggling $2.5B worth of Nvidia GPUs to China, which was no surprise. x.comÂ
Super Micro Computer faces governance risk as Taiwan's chip-smuggling probe reaches it. Per the Kobeissi Letter, the stock fell more than 9% after its Taiwan office was raided. The raid is unsurprising given that its CEO smuggled Nvidia products to China. x.comÂ
Super Micro's heavy capital spending should pay off, making it worth buying now. x.comÂ
Super Micro Computer has been rotten from the beginning, a stock to avoid when so many peers are available. Per @StockMKTNewz, citing CNBC, US prosecutors have charged a Super Micro co-founder, employee and contractor with smuggling Nvidia chips to China, yet the stock is only down about 3%. x.com x.comÂ
Super Micro Computer is an AI hardware company with a history of fraud and is likely committing some kind of fraud now, so a surprise guide of 15-17% Q4 gross margins versus 8% previously does not make it a credible long. x.comÂ
Super Micro Computer's nearly 40% drop over the past month is a market overreaction, since the allegations targeted a director, not the company, and found no company wrongdoing. Some of the pressure may have been competitor-driven or politically amplified. What matters is engineering strength: it builds roughly all of xAI's servers, is involved early in Terafab, and is often the first partner AI-chip startups such as d-Matrix turn to. It remains a long-term hold. x.comÂ
Super Micro Computer is a fraud risk that hasn't changed: per Bloomberg, relayed by @StockMKTNewz, its offices were raided as Taiwan expanded a chip-smuggling probe. Arm or other semiconductor names are the better holdings. x.comÂ