Unlock Editor's Digest at no cost
Roula Khalaf, editor of the FT, picks her favorite stories on this weekly newsletter.
Super Micro Computer said Tuesday that an independent investigation into concerns raised by former auditor EY found no evidence of fraud or misconduct by management or the board. However, the corporate's shares fell as the corporate said it was unsure when it will file its annual report with regulators.
The server maker's shares, which had soared on artificial intelligence hype, fell by a 3rd last week after EY announced it was stepping down as auditor.
In a filing on Tuesday Super Micro said an independent select committee tasked with reviewing EY's concerns found “no evidence of fraud or misconduct by senior management or the board.”
“The committee recommends a series of remedial measures for the corporate to strengthen its internal governance and oversight functions,” he added, saying the committee expects to submit a full report on its three-month investigation in the approaching days.
Super Micro added that it was still uncertain when it will give you the option to file its annual 10-K report with regulators, which was due in late August. Its shares lost around 16 percent in after-hours trading.
“We are within the strategy of hiring a brand new auditor,” Chief Executive Charles Liang told investors on an earnings conference call. “We are working hard to bring our financial reporting back up thus far.”
Super Micro also published preliminary quarterly results on Tuesday that were barely below expectations. The company expected revenue between $5.9 billion and $6 billion for the quarter ending September, which is on the low end of the corporate's previous forecast and below consensus estimates of $6.5 billion.
For the present quarter through the top of December, sales are expected to be between $5.5 billion and $6.1 billion, which is below Wall Street estimates of $6.8 billion.
Silicon Valley-based Super Micro, a key partner of $3.4 trillion artificial intelligence chip maker Nvidia, was a key beneficiary of booming investor enthusiasm for AI infrastructure, and its shares rose by more between the beginning of 2023 and their peak than 1,000 percent in March this yr.
But it has fallen sharply since then. In September, the Wall Street Journal reported that the U.S. Department of Justice was investigating the corporate after a brief seller reported accounting manipulation.
EY was hired by Super Micro in the midst of last yr and was conducting its first audit of the corporate. The resignation was “attributable to information that recently became known to us and which has resulted in us now not having the ability to depend on the representations of management and the audit committee,” it said. Super Micro said on the time that it disagreed with EY's decision but took its concerns seriously.
