Super Micro Computer, Inc. Q3 FY2025 earnings call

• Fiscal Q3 net revenue totaled $4.6 billion, lower than original forecast due to customers waiting for Blackwell GPUs. Non-GAAP EPS stood at $0.31 per share. - Successfully fulfilled commitment to regain financial regulatory compliance and delivered new generation AI products. - Launched Datacenter Building Block Solutions (DCBBS) featuring DLC-2 technology, which shortens datacenter build time, reduces cost, and improves performance. - DLC solutions have shipped 4,000 100kW AI racks, aiming to double volume next year. - Global operations expanding with new Malaysia campus, and U.S. domestic manufacturing capacities scaling up.

Fiscal Q3 2025 revenues were $4.6 billion, up 19% year-over-year and down 19% quarter-over-quarter. Server and Storage Systems comprised 97% of Q3 revenue and Subsystems and Accessories represented 3%. By vertical, the enterprise/channel vertical was $1.9 billion (42% of revenues) and the OEM appliance and large data center vertical was $2.6 billion (57% of Q3 revenues). By geography, the U.S. represented 60% of Q3 revenues, Asia 30%, Europe 6%, and Rest of World 4%. On a year-over-year basis, U.S. revenues increased 3%, Asia increased 77%, Europe decreased 3%, and Rest of World increased 83%. On a quarter-over-quarter basis, U.S. revenues decreased 28%, Asia increased 76%, Europe decreased 69%, and Rest of World increased 45%.

• Anticipates Q4 revenues of at least $6 billion. - For fiscal year 2025, expects revenues of $21.8 billion to $22.6 billion. - Q4 gross margins expected to be approximately 10%. - CapEx for Q4 expected to be in the range of $45 million to $55 million.

• Macroeconomic and market uncertainties making precise forecasting difficult. - Tariff impacts affecting business. - Challenges related to technology transition between GPU platforms impacting revenues and margins.

Q: Are customers pulling back orders or seeing changes in order trends due to macro?

A: Charles Liang says June will be strong, sees strong orders for June and September, and Blackwell in volume production will drive stronger next fiscal year.

Q: Change in pricing landscape for new products affecting gross margin?

A: Charles Liang states it's a combination of tariff concerns, conservatism, and impact from technology platform changeover from Hopper to Blackwell.

Q: Demand for HGX B200 and NVL72 racks?

A: Charles Liang says strong demand for GB200 NVL72 and B200 liquid cooling, but customer liquid cooling data center had some waiting, but schedule is getting exciting.

Q: Inventory reserve impact on margins?

A: David Wiegand says inventory reserve reduced margin by 220 basis points, mainly from older inventory products, and revenues expected in Q3 were platform decision based, leading to reserves and competitive pricing.