01—Abstract
Summary
Summary of the 10-Q filed May 11, 2026. Cited figures are marked; the original filing is the authoritative source.
Super Micro Computer, Inc. reported a sharply higher third quarter of fiscal 2026 (three months ended March 31, 2026), with net sales of $10.24 billiona versus $4.60 billion a year earlier and net income of $483.4 million versus $108.8 million.
Gross profit rose to $1.02 billionb from $440.2 million, and income from operations reached $625.9 million versus $146.8 million. For the nine months, net sales were $27.94 billion versus $16.22 billion and net income was $1.05 billion versus $853.7 million. The filing attributes the growth primarily to fulfillment of orders supporting customers' data center deployments, including large design wins from a few customers, with AI GPU related product sales up $5.16 billion year over year in the quarter.
Cash flow and balance sheet trends warrant close attention. Net cash used in operating activities was $7.56 billionc for the nine months, compared with $795.9 million provided a year earlier, driven by higher inventories ($11.10 billion versus $4.68 billion at June 30, 2025), accounts receivable ($8.41 billion versus $2.20 billion) and working capital needs. Cash and cash equivalents fell to $1.29 billion from $5.17 billion.
Lines of credit and term loans totaled $4.11 billiond, including a $2.00 billion JPMorgan revolving facility and $1.76 billion outstanding under CTBC revolving facilities, and convertible notes were carried at $4.66 billion. The filing discloses that management concluded disclosure controls and procedures were not effective as of March 31, 2026, due to material weaknesses in internal control over financial reporting that remain unremediated.
Legal and regulatory matters are significant: multiple securities class actions and derivative lawsuits are pending, an SEC subpoena was received, and a March 19, 2026 indictment by the U.S. Attorney's Office for the Southern District of New York concerns three individuals formerly or previously associated with the Company. The Company is not named as a defendant in the indictment, and it has launched an independent investigation, with no conclusion reached.
02—Key points
Key Highlights
- Net sales of $10.24 billion for the quarter, up from $4.60 billion, and $27.94 billion for the nine months, up from $16.22 billion; AI GPU related product sales rose $5.16 billion (150.5%) in the quarter.
- Net income of $483.4 million for the quarter (diluted EPS $0.72) versus $108.8 million (diluted EPS $0.17); nine-month net income of $1.05 billion versus $853.7 million.
- Gross margin was 9.9% for the quarter versus 9.6% a year earlier, while nine-month gross margin declined to 8.2% from 11.6%, reflecting product and customer mix, expedite costs, tariffs and inventory write-downs of $239.3 million.
- Net cash used in operating activities was $7.56 billion for the nine months, compared with $795.9 million provided a year earlier, as inventories rose to $11.10 billion and accounts receivable to $8.41 billion.
- Total lines of credit and term loans were $4.11 billion at March 31, 2026 (versus $112.5 million at June 30, 2025), including $2.00 billion under a JPMorgan revolving facility and $1.76 billion under CTBC revolving facilities.
- Management concluded disclosure controls were not effective as of March 31, 2026, due to material weaknesses in internal control over financial reporting that remain unremediated.
- Pending securities class actions, derivative litigation, an SEC subpoena received November 2024 and another on April 28, 2026, and an independent investigation following the March 19, 2026 indictment all remain unresolved, with the Company unable to estimate possible losses.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2026, Super Micro Computer kept $0.05.
- Revenue$10.24B100.0%
- Cost of revenue−$9.22B90.1%
- Gross profit$1.02B9.9%
- Operating costs−$392.8M3.8%
- Operating income$625.9M6.1%
- Interest, other & tax−$142.5M1.4%
- Net income$483.4M4.7%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2026filed May 11, 2026Financial Statements
Q3 FY2026 against Q3 FY2025
| Line item | Q3 FY2026Q3 FY2025 | Change |
|---|---|---|
| Revenue | $10.24B$4.60B | +122.7% |
| Cost of Revenue | $9.22B$4.16B | +121.8% |
| Gross Profit | $1.02B$440.22M | +131.4% |
| R&D Expenses | $215.66M$162.86M | +32.4% |
| Operating Expenses | $392.81M$293.44M | +33.9% |
| Operating Income | $625.87M$146.78M | +326.4% |
| Net Income | $483.39M$108.78M | +344.4% |
| EPS (Basic) | $0.81$0.18 | +350.0% |
| EPS (Diluted) | $0.72$0.17 | +323.5% |
| Shares Outstanding (Basic) | 600.21M595.04M | +0.9% |
| Shares Outstanding (Diluted) | 692.19M621.81M | +11.3% |
05—Questions
Frequently Asked Questions
How much did Super Micro's revenue and profit grow in the latest quarter?
Net sales for the three months ended March 31, 2026 were $10.24 billion, compared with $4.60 billion a year earlier, an increase of $5.64 billion (122.7%). Net income rose to $483.4 million from $108.8 million, and diluted EPS was $0.72 versus $0.17.
What drove the increase in net sales?
The filing attributes the increase primarily to fulfillment and shipment of orders supporting customers' data center deployments, including large design wins from a few customers. AI GPU related product sales increased $5.16 billion, or 150.5%, year over year in the quarter, and a higher average selling price contributed modestly through product mix.
Why is operating cash flow negative?
Net cash used in operating activities was $7.56 billion for the nine months ended March 31, 2026, versus $795.9 million provided in the prior-year period. The filing cites increased inventory purchases, higher accounts receivable from customers and increased operational spending, with inventories at $11.10 billion and accounts receivable at $8.41 billion at March 31, 2026.
How is the company funding its working capital needs?
Lines of credit and term loans increased to $4.11 billion at March 31, 2026, from $112.5 million at June 30, 2025, including a $2.00 billion JPMorgan revolving credit facility and $1.76 billion outstanding under CTBC revolving credit facilities. The company also sold trade receivables of $831.7 million under its Receivables Purchase Agreement during the period. Cash and cash equivalents fell to $1.29 billion.
What are the main risks highlighted in this filing?
The filing discloses material weaknesses in internal control over financial reporting, leaving disclosure controls not effective as of March 31, 2026. It also describes pending securities class actions and derivative lawsuits, an SEC enforcement subpoena, and the March 19, 2026 indictment of three individuals associated with the Company, which the Company says it is not named in and is investigating independently. Export control restrictions on AI-related products are also flagged as a risk to future results.
06—Continue