Super Micro Computer Inc
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Earnings Call Q1 2027
November 3, 2026 - AI Summary
Q1 fiscal 2027 performance beat expectations (growth + profitability)
- Revenue: $19.9B, up 298% YoY and +79% sequentially—above guidance range ($14.5B–$15.5B) and above the company’s earlier preliminary range ($18.5B–$19.5B).
- Mix: AI solutions ~71% of Q1 revenue (vs 59% in Q4). AI backlog implies ~70%–80% of fiscal 2027 revenue.
- Gross margin: 12.8% non-GAAP (+330 bps YoY), and above guidance (10.4%–10.8%).
- But GAAP gross margin fell sequentially (12.7% GAAP, down from 17.6% in Q4)—management says this is largely timing/mix (AI large-deployment delivery order + deferred revenue recognition) rather than weak underlying AI margin.
- Outperformance drivers: healthier customer/product mix; increased contribution from higher-margin DCBBS (Data Center Building Block Solution) including hardware + software + services.
DCBBS / software orchestration + services are positioned as the “moat” (opportunity)
- CEO emphasized DCBBS as a rack-scale, factory-tested “plug-and-play” approach that improves TTD (time to delivery), TTO (time to online), uptime, and lower TCO.
- Software stack mentioned: SuperCloud Composer (SCM/SCC) for rack-scale orchestration, Datacenter Manager (SDM) for power/thermal control, and Operation Manager (SOM suite) for agentic AI/bare-metal and token-as-a-service operations.
- Service growth model: expanding global on-site deployment and telemetry-driven monitoring aimed at reducing downtime and driving recurring service revenue.
- Strategic momentum: early shipping of NVIDIA “Vera Rubin” NVL72 racks and expansion into Intel Xeon 6+ and Arm AGI solutions; more partnerships (Cisco, NetApp, Nutanix, etc.).
Working capital improved sharply; prepayments are funding growth (surprising “cash” strength)
- Cash conversion cycle improved from 149 days to 97 days (a 52-day improvement in a single quarter).
- Management said the improvement is meaningful financially: at the Q1 run-rate, the delta equates to roughly $10B of working capital that otherwise would have been needed.
- Key mechanics:
- Receivables DSO improved to 36 days (from 59).
- Customer prepayments drove much of the working capital support (deferred revenue up ~$3.1B during the quarter).
- Cash flow: used $434M from operations on $19.9B revenue; inventory increased to support the future ramp ($15.1B vs $12.9B).
- No material credit losses; DSOs and deposits/prepayments reduce delivery financing risk.
- Dividend/buyback: no buybacks mentioned. Dividends: the company highlighted a mandatory convertible preferred dividend of ~$75M per quarter (in the EPS mechanics discussion).
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$-40.45
250.6% downside
Current Fair Value
250.6% downsideOvervalued by 250.6% based on the discounted cash flow analysis.
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Share Statistics
| Market cap | $17.68 Billion |
|---|---|
| Enterprise Value | $23.76 Billion |
| Earnings per Share | $3.65 |
| Beta | 2.18 |
| Outstanding Shares | 658,128,000 |
Return
| Return on Equity | 22.75% |
|---|---|
| Return on Assets | 10.23% |
| Return on Invested Capital | 19.51% |
Valuation & Multiples
| P/E Ratio | 5.08 |
|---|---|
| PEG | 0.6 |
| Price to Sales | 0.33 |
| Price to Book Ratio | 1.12 |
| Enterprise Value to Revenue | 0.44 |
| Enterprise Value to EBIT | 4.94 |
| Enterprise Value to Net Income | 6 |
| Total Debt to Enterprise | 0.55 |
| Debt to Equity | 0.81 |
Revenue Sources
No data
Last Earnings Call
Report Date
November 3, 2026
EPS
$1.81
Est. $1.28Revenue
$19.95 B
Est. $16.29 BNext Earnings Call
Expected Date
February 2, 2027
EPS Estimate
$1.78
Consensus analyst estimateRevenue Estimate
$20.45 B
Consensus analyst estimateInstitutional Put/Call Ratio
Compares institutional put options with call options. At 0.91, the ratio is below 1, so institutions hold more calls than puts.
| Put/Call Ratio | 0.9111▼ 10.52% |
|---|---|
| Total Calls | 28,789,526▼ 65.51% |
| Total Puts | 26,229,996▼ 69.08% |
Institutional Ownership
Holdings and activity of institutional investors.
| Ownership % | 50.93%▼ 24.12% |
|---|---|
| Total Invested | $12.57B▼ 5.01% |
| Investors Holding | 777▼ 124.00% |
About Super Micro Computer Inc
6,238 employees
CEO: Charles Liang
Super Micro Computer, Inc. designs and manufactures advanced, high-performance server and storage solutions. These offerings leverage a modular and open architecture and are distributed globally, including across the United States, Europ...