SMCI: Super Micro Computer Stock Drops 9% After Server Maker Files to Dump 2 Million Shares

Builder of Nvidia’s AI pieces of hardware caught investors off guard a day after it was added to the S&P 500 index.

Key Points:

• Super Micro nosedives 9% on share sale.
• Company builds servers for AI giant Nvidia.
• Server maker has pulled a 10X in one year.
• Super Micro Computer stock SMCI nosedived 9% on Tuesday after the company filed to dump 2 million shares. The decision was met with criticism by investors who feared it might dilute their stacks of shares and water down their value. Further, beyond the 2 million offering, Super Micro has put up an additional 300,000 shares for sale by investment bank Goldman Sachs GS as the underwriter.
• “The principal purposes of this offering are to obtain additional capital to support our operations, including for the purchase of inventory,” Super Micro said in the filing. The news broke a day after the company entered the broad club of 500 stocks packaged in the S&P 500. Super Micro replaced home appliance mainstay Whirlpool WHR.
• What is Super Micro? It’s the company building servers for AI powerhouse Nvidia NVDA and its shares have blasted off more than 10 times over the past twelve months. Boasting a valuation of about $50 billion today, it floated shares on the Nasdaq back in 2007 with a stock valued at $250 million, turning a $1,000 at IPO into $200,000 today.