Nucor earnings beat by $0.08, revenue fell short of estimates
Wednesday, Super Micro Computer (NASDAQ:SMCI), a $19.66 billion technology hardware company, received a boost as Needham analysts resumed coverage with a positive outlook. The firm issued a Buy rating and set a price target of $39.00, marking a renewed interest after a period of suspended coverage due to financial uncertainties surrounding the company. According to InvestingPro data, SMCI has demonstrated remarkable revenue growth of 125% over the last twelve months.
The coverage reinstatement follows Super Micro’s announcement of third-quarter fiscal year 2025 revenue and non-GAAP gross margin, which aligned with preliminary figures but fell short of previous expectations. Needham analysts pointed to product transitions and tariff uncertainties as factors contributing to the company’s recent performance challenges. InvestingPro analysis reveals that the company currently faces weak gross profit margins of 12.44%, though it maintains a strong financial health score.
Despite these short-term obstacles, analysts at Needham expressed a growing confidence in Super Micro’s prospects. The company’s completion of its fiscal year 2024 Form 10-K and quarterly filings for the first and second quarters of fiscal year 2025 were cited as positive developments. Additionally, enhancements to the management team were viewed favorably. With analysts forecasting 59% revenue growth for fiscal year 2025, the company’s growth trajectory remains strong.
Needham’s analysts highlighted Super Micro’s positioning in markets for artificial intelligence and high-performance computing, as well as its leadership in liquid-cooled data center technology. These factors, combined with the resolution of filing risks and what Needham considers an "extremely attractive" valuation, contributed to the decision to issue a Buy rating.
The $39.00 price target is based on a 10 times price-to-earnings multiple applied to Needham’s calendar year 2026 non-GAAP earnings per share estimate of $3.90 for Super Micro. This target reflects the firm’s expectations for the company’s financial performance over the next 12 months.
In other recent news, Super Micro Computer reported mixed results for Q3 2025. The company announced a non-GAAP earnings per share (EPS) of $0.31, slightly surpassing the forecast of $0.30, but its revenue of $4.6 billion fell short of the expected $5.05 billion. Despite the revenue miss, the company anticipates recognizing approximately $1 billion in delayed revenue in the June and September quarters due to delays in shipments related to NVIDIA (NASDAQ:NVDA)’s Blackwell GPU platforms. Looking ahead, Super Micro Computer has set a Q4 2025 revenue guidance between $5.6 billion and $6.4 billion. Analyst firms have reacted to these developments; Rosenblatt Securities maintained a Buy rating on the company’s stock but reduced the price target from $55.00 to $50.00, while Citi lowered its target from $39.00 to $37.00, maintaining a Neutral stance. Rosenblatt’s adjustment reflects expectations of strong growth driven by demand for new systems, despite geopolitical challenges. Meanwhile, Citi’s analysis indicates that revenue delays may persist, impacting future forecasts.
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