Super Micro plunges 44% this week, erasing the stock’s gains for the year | Wilnesh News

Super Micro Investors continued to rush for the exits on Friday after the data center company lost its second auditor in less than two years, sending the stock down another 10%, bringing the week’s losses to 44%.

The company’s stock price fell to as low as $26.01, erasing all gains in 2024. S&P Dow Jones added the stock to the S&P 500 earlier that month, and Wall Street rallied on the company’s growth, driven by server sales. NVIDIA Artificial intelligence processor.

Super Micro’s stunning plunge since March has wiped out about $55 billion from its market value and put the company at risk of being delisted from Nasdaq. On Wednesday, AMD was having its second-worst day ever, as the stock was having its second-worst day ever. explain It will provide its latest quarterly “business update” on Tuesday (U.S. Election Day)

The company’s latest challenges date back to August, when AMD said it would not file its annual report with the SEC on time. Prominent short seller Hindenburg Research later disclosed the company’s short position, writing in a report that it had found “new evidence of accounting manipulation.” wall street journal Later reported The Justice Department is in the early stages of investigating the company.

Supermicro disclosed on Wednesday that Ernst & Young has resigned from the accounting firm just 17 months after taking over from Deloitte & Touche LLP. The auditor said it “is unwilling to have any connection with the financial statements prepared by management.”

An AMD spokesperson told CNBC that the company “disagrees with EY’s decision to resign and we are working to select a new auditor.” The representative said AMD does not expect the matters raised by EY to “result in its financial performance as of June 30, 2024.” any restatement of its quarterly financial results for the fiscal year or prior fiscal years.”

Analysts at Argus Research on Thursday downgraded the stock to a mid-term rating on the stock to hold, citing the Hindenburg report, the Justice Department investigation and the departure of Super Micro accounting firm, which analysts said was ” Serious problem”. Argus’ concerns go beyond accounting irregularities, with the company saying the company may be doing business with questionable entities.

“We believe the DOJ’s concerns are likely to be primarily related to related-party transactions and SMCI products ending up in the hands of sanctioned Russian companies,” the analysts wrote.

In September, one month after the delay in filing applications was announced, Chaowei said It received notification from Nasdaq that its delayed status meant the company was not in compliance with the exchange’s listing rules. Super Micro said Nasdaq’s rules allow the company 60 days to file a report or submit a plan to return to compliance. According to that timeline, the deadline is mid-November.

Although Super Micro has not filed financial reports with the SEC since May, the company said in its August earnings report Promotional meeting Revenue more than doubled for the third consecutive quarter. Analysts expect revenue to grow more than 200% in the first fiscal quarter ending in September, to $6.45 billion, according to LSEG. That’s up from $2.1 billion a year ago and $1.9 billion in the same fiscal quarter of 2023.