SuperMicro at KeyBanc Forum: Innovation and Growth Strategy

On Monday, 11 August 2025, SuperMicro (NASDAQ:SMCI) participated in the KeyBanc Capital Markets Technology Leadership Forum, where Michael Stager, Senior Vice President of Corporate Development, outlined the company’s strategic growth plans. The discussion highlighted SuperMicro’s impressive market share gains and robust financial health, while also addressing challenges such as inventory management and supply chain dynamics.

Key Takeaways

• SuperMicro aims to capture a 33% market share, significantly up from 3.5% in 2021.
• The company targets over $33 billion in revenue by fiscal year 2026, reflecting more than 50% growth.
• SuperMicro holds approximately $7 billion in liquidity, supporting future growth initiatives.
• Innovation in liquid cooling and data center solutions positions SuperMicro as a leader in the enterprise market.
• The company is focused on expanding its customer base, planning to add 2 to 4 scale customers by 2026.

Financial Results

• Full-year growth reached 47%, with market share rising progressively to 22%.
• Revenue is projected to exceed $33 billion in fiscal year 2026, with a focus on achieving 15-17% gross margins.
• Liquidity stands strong with $5.2 billion in cash and $1.79 billion available from an AR credit facility.

Operational Updates

• SuperMicro is enhancing its Data Center Building Block Solutions (DCBBS) to offer comprehensive data center solutions.
• The company is innovating in liquid cooling technology with DLC2, improving efficiency and reliability.
• A significant opportunity is seen in sovereign cloud infrastructure, with a potential $20 billion deal for Databol.

Future Outlook

• SuperMicro is poised for substantial growth, targeting a market-leading position.
• The company plans to leverage its strong liquidity to support expansion and innovation.
• A strategic focus on the enterprise market aims to capture technology-forward customers.

Q&A Highlights

• SuperMicro is actively managing its capital needs, ensuring liquidity is sufficient for growth without unnecessary dilution.
• The enterprise market remains a priority, with solutions tailored to different industry verticals for higher margins.

In conclusion, SuperMicro’s participation at the KeyBanc Forum underscored its commitment to innovation and strategic growth. For more detailed insights, readers are encouraged to refer to the full transcript below.

Full transcript - KeyBanc Capital Markets Technology Leadership Forum:

Brandon Nispel, IT hardware coverage, KeyBank: It’s still good morning everybody. Welcome to the KeyBank Technology Leadership Forum. My name is Brandon Nispel. I cover IT hardware among many other sectors for KeyBank. Thanks all for being here.

This is a twenty five minute fireside chat. We have Michael Stager, Senior Vice President of Corporate Development with SuperMicro. Michael, thank you for being here.

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: Hey, thanks for having us. Thank you to KeyBank and thank you for your coverage. Just want to like highlight please refer to our website regarding cautionary statements regarding forward looking statements, the standard legal disclaimer.

Brandon Nispel, IT hardware coverage, KeyBank: Well done. Let’s just start. You guys reported earnings last week. Why don’t you give us a quick recap of the fourth quarter?

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: Well, I mean, without getting into too many details, we think we had a pretty good quarter. We’re within range. We grew for the full year, we grew 47%. We have lots of new customers coming into the fold. We talked about where we grew one customer to scale customer in 2024, four in 2025 and we expect to add two to four more in fiscal twenty twenty six.

Brandon Nispel, IT hardware coverage, KeyBank: Got it. You know one of the things that’s come up and I think it’s sort of unclear what exactly is but a lot of answers to the questions was around data center building block solutions, right? Can you help us understand what that is for Supermicro?

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: Yeah. From that perspective, you really have to, like, look at what’s going on in the industry, what’s happening. AI is obviously on everyone’s minds. You everyone’s hearing about hyperscaler CapEx, and hyperscalers are, like, building out like crazy, building out like mad. We have a whole host of customers that are following suit, Neo Cloud, Sovereign Enterprises, right?

So from that perspective, the hyperscalers have the manpower, the staff internally to develop systems across the the full scale to offer these services. Many customers don’t have that capability. So we’re moving beyond just supplying the system or the rack to the customer to the full suite of solutions for the customers so that they can get up and running in fast time so they can offer the services to those customers. And those customers on a DCBBS, whether it’s retrofitting air cooled to liquid for a data center that might not be ready and adding different componentry, different services, integration services, support, cabling and get full suites because those customers don’t have those capabilities. And we’re providing them for them as opposed to just being in a competitive situation where it’s rack to rack, where there’s a lot of noise on that front where some of the larger customers are just trying to build as fast as they can, give me as many racks as you can.

And like I said, these other customers are like, can you please help us get those racks on the on the floor.

Brandon Nispel, IT hardware coverage, KeyBank: You you sort of alluded to it, but how does this different, sort of change how you guys operate and do business? Is this a big strategic lift or is it sort of a little bit more simple from an operational standpoint?

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: I wouldn’t call it a big lift. What I would call it is is that we’ve always been focused on performance, density, systems design, engineering, etcetera, and getting the best lowest cost per compute per watt for a customer. This just happens to be in our DNA, so innovating on a platform. And as we move forward, these platforms are getting more complicated. So our ability to innovate and scale those innovations is starting to expand is expanding.

And so from a competitive perspective, our focus is innovation. So we’re a serial innovator. So if you think forward, what will things look like? There’s some announcements today about the RTX 6,000, you know, for inference, right? So the market’s focused on the AI platforms, like language models are getting built out.

Like, if you think about the context windows, they’re too small, Right? So as they expand, the training models are gonna get bigger, but at the same time, you’ll have more users on the inferencing side. So we look at it in a holistic approach where we will deliver the best, most complete training platform, if you want to call it, with our partners. And at the same time, we’ll have innovation that goes around that on the inferencing side. So we have a full set of solutions for the customer to optimize for the application.

Those applications are starting to expand in use. And we heard this morning at your conference to a couple of users where one or two could peg one of the services by running a couple of models. Like that much capacity by one user, like, gives you an idea that the core AI systems are not built out yet or the training models aren’t built out yet. There’s a whole ecosystem, and we’re focused on building to that ecosystem.

Brandon Nispel, IT hardware coverage, KeyBank: Can you talk about sort of the higher value add services within the what is it DB? DCBBS. DCBBS, thank you. Like software services, how do you sort of implement more higher value added services And then talk weave in there how you expect that to translate into like gross margins, profitability for you guys? So from our perspective, like I said, as we look at a customer

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: and the customer is focused on trying to get up and running, We are trying to put together the pieces that they need so that they can don’t have to rely on multiple vendors to bring that data center up. So it’s a complete suite for the data center. In many instances, we’re working with other ISVs, like we’ll take storage, for example, and we’ll do a special purpose built back end, whether it’s flash based or disk based storage system with the partner. And if we can deliver that at the same time with the platform itself, along with some of the cooling elements, whether it’s a sidecar, whether it’s the rear door heat exchange, etcetera, whatever that customer needs, we’ll put that on the floor for them in record time and encapsulate services on that, so it’s ongoing support. So when we do that, we won’t be in a position where it’s rack for rack pricing competition.

So that will lift our margins up to the ranges that we talked about in the longer term.

Brandon Nispel, IT hardware coverage, KeyBank: Got it. Let’s talk about revenue growth. Super Micro has been an industry leader outpacing the industry from a growth standpoint. Just help us unpack sort of where you think you are from a market share standpoint, how you’ve grown over the years and ultimately taking market share.

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: So if you look at the historical element there, what 3.5% in ’twenty one to 5.2% to 7.2% to 15% to ’twenty two percent, and then we guided to 33%. Clearly, there’s something there that is a huge value. Like the growth rates are strong because we’re innovating for the customers. We’re delivering the best platform for those customers and we’re giving the best cost per compute per watt. And then the extension of that will be to wrap around not just the core of that, but we’ll wrap around more product into that and continue to expand our growth.

We feel like we’re at early stages. And on a comparative basis, what we’re doing is innovation as opposed to like can you just deliver a rack to us and people are trying to be fast followers. Those innovations and the generations in our partners’ product sets, which keep changing year to year, we’re staying in pace with that. We have the capability of delivering it. We design we do the design, engineering, we do the manufacturing.

All these are in house. We control all these elements, right? So we’re able to flex faster. Not only that, but the learnings from the prior platform will bring them to the next platform. And so people are focused on the reference architectures from our partners, But we’re focused on not just the reference architecture, making that work the best, but we’re focused on the reference architecture.

How can we take the reference architecture and advance it so it benefits our customer so that we have a differentiated product and so that we carry that product forward. So it’s kind of right now, we’re in a land and expand kind of mode, and we’ve proven our mettle. And by the fact that we’ve had large scale customers that are relying on us for very important builds as we move forward, The enterprises and the smaller customers are like, wait a minute, Super Micro has these capabilities and I know some of the other players out there aren’t innovating. So I can get the best solution, the best for the application that I want to deploy, so I get the best bang for my buck and deliver to my end customers. So we’re trying to help our customers do that and it all comes around serial innovation, being at the forefront and controlling all these elements and keeping them in house.

So I think if you look at it that way and you look long term, like, you know, we could potentially be like the largest supplier in industry, and that’s the, know, that’s the long term goal of our CEOFounder.

Brandon Nispel, IT hardware coverage, KeyBank: Got it. You alluded to it. The company recently guided to greater than $33,000,000,000 in revenue in fiscal twenty twenty six. It’s over a 50% growth rate, an acceleration year over year. Can you help us understand sort of what you guys are seeing and what data points you can share that can help us get some confidence in that growth reacceleration?

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: So I think the historical pattern of what we’ve done is like should give people confidence that like the growth is there, right? The second element of that is if we had one scale customer in 2024, now we have four in 2025, we said that there would be we expect those customers to grow with us into 2026, and two to four more would come into the fold at least in 2026. So that gives you the framework of like the expanse of what we’re doing. So that’s a pretty good understanding without being like, you know, Wall Street specific of like who, what, why and when. So we feel pretty confident that the at least 33% is a great number and an indication of where

Brandon Nispel, IT hardware coverage, KeyBank: we’re So help me bridge from a modeling standpoint because you also guided to your fiscal first quarter 26% to about 10% growth at the Is this a stair function higher throughout the year? Should we just step it up right away in 2Q? How do you want us to think about like

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: the 20 So we didn’t provide any specific linearity with respect to like how the Street would model the 26%. What I can say is that with new customers coming into the fold, with the fact that we have, you know, neo clouds, there are more that are emerging, the fact that sovereigns are emerging, those builds, you know, and then parse that back with supply, timing, bill, etcetera. If they all come in at the same time, the numbers could move faster. So it’s a timing element. And so when we think about our business, obviously, we have to guide to the quarters from a Street perspective, but we really think about it in terms of like long term and the visibility that we have with the markets.

And so the at least 33%, so how that works out it remains to be seen. You’ve seen variance in the quarter to quarter. Larger customers have a greater impact on things moving around. We talked about where we had a new scale customer or potential scale customer come back to us and say, hey, look, we need to rearchitect this design to fit this one particular data center, which kind of altered the flow of revenues in the prior quarter. So those things, you know, can flex the business model, makes it a little bit of a challenge.

But if you think more along the lines of like where’s the long term direction going of, one, the industry, two, the fact that we’re like the leading technology innovators in that industry, where we will be in ’twenty six, ’twenty seven, ’twenty eight is going to be in a different place than it is today. I think it’ll be a much, much larger.

Brandon Nispel, IT hardware coverage, KeyBank: Sovereign seems like maybe the biggest incremental opportunity because you you have some deal clouds as as customers today. How do you sort of characterize what the demand outlook or opportunity is around Sovereign? And and you did announce a deal, you know, for up to $20,000,000,000 for Databol. Help us understand sort of what the sovereign opportunity is.

Unidentified speaker: Well,

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: as we’ve indicated in the past, we had numerous, numerous entities approaching us. So as you think about that customer set and what they’re trying to do inter country to leverage AI to be more efficient, whether it’s at the government level or through their, you know, whatever industries they own, whether it’s telecom, they’ve been coming to us and and when they take a look at Super Micro, they’re not looking at Super Micro like how many racks can you give me today, right? They’re looking at us and saying, hey, can you carry me through the product transitions that we’ve heard about into the future and support us? And can you help us set up an architected data center which rolls back to the DCBBS? So these and these customers also as well are fairly well funded as being government entities, right?

So it’s a little bit of a deeper partnership. We’ve seen we have business in some of these particular pockets, and we expect some of those to turn on to be much larger. So it’s an opportunity set that our partners are talking about. We’re in the process of realizing those opportunities and developing products around to really help them out, which rolls back to DCBBS. There’ll be more product elements to DCBBS that will be announced later on in the year.

So I think it’s all coming coming together, and it looks pretty promising from our perspective, which rolls us back to, we think, that in the two to four additional large scale customers, it’s likely that there’ll be a sovereign entity And in that

Brandon Nispel, IT hardware coverage, KeyBank: that should build over time outside of fiscal ’twenty six into ’twenty seven and ’twenty eight as other sovereigns sort of developed their AI strategies.

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: And so, yes, so you would think about where we are right now, it’s like land and expand. Obviously, there’s a lot of competition, but at the same time, and expand and innovate at the same time, like that’s an arc of like pretty takes a high degree of intellect to do that in the engineering level. And roughly half the force is engineers and they’re focused on multiple different SKUs and products to bring this together to take advantage of of the our partners’ technology so that we can serve the customer base. And the customer base is going to be much larger in the future. And the current customers that we have, the repeat nature of the customer, we’re engaged with them, is very high.

So we’re pretty comfortable on a long term scale like where we’re going relative to some of the things that some of the sell siders might be saying. Not you, not you, what I’m just saying?

Brandon Nispel, IT hardware coverage, KeyBank: Let’s shift gears. Let’s talk about gross margins a little bit. You guys just reported about a 10% just shy of 10% gross margins. The company continues to sort of put out expectations to return to a 15% I think to 17% gross margin. Data center building blocks part of that solution.

What have been sort of the factors that have got us from the traditional level of gross margins back to today? And then how do you see that playing out sort of in the future to get back to the normalized rate?

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: So from that perspective, there’s been a tremendous rush to try to put something on the floor, right? And everyone’s saying and claiming that they can do X, Y, Z or they can deliver racks. We think over time that those claims maybe tail off a little bit. We’re focused more on the full suite for the customer and doing the best for the customer. So we’re a customer focused company or innovation focused company.

So from those perspectives, the innovation element, if we can bring an advancement in any one of these reference architectures that’s significant and unique, that’s an instantaneous margin enhancement profile. We think we’ll be able to keep gaining ground in that area. So in the short term, there’s been some pressure to satisfy some customers and customer builds. We think that will ease over time. We’re not saying it’s going to ease immediately, but the focus of the company is to get back to these levels.

I think even Charles mentioned like, hey, if we wanted to, we could grow faster, but they were lower margin levels. No, the focus is to have a very profitable business as we move forward and serve our customer base and expand our footprint. So that’s a land and expand mode right now where we’re at right now.

Brandon Nispel, IT hardware coverage, KeyBank: What are you seeing from your main competitors? Like are they becoming more aggressive from a pricing standpoint? They you know, how would you sort of characterize competitive environment and then impact in gross margin?

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: It’s the competitive environment has always been aggressive. Like everyone knows that it’s a competitive environment. What I think the disconnect is that they’re not valuing the innovation element that is rapidly happening under the covers. So if you have to support legacy products, legacy applications, legacy software, you don’t control the engineering, you don’t control the design, you don’t control the production, there’s a disadvantage in that in the long term element sort of that business. So, this platform business, AI business is going to evolve is evolving, and we will be we’re very well positioned to take advantage of that switch and change.

Brandon Nispel, IT hardware coverage, KeyBank: You’re clearly trying to make some progress on gross margins operationally with DCBBS. One of the arguments that we’ve made is margins are sort of structurally moving lower. And it’s almost just like a mathematical equation where the bill of materials in the overall server rack contains a higher cost of GPU and so margins sort of just structurally move lower. What you think of that type of thesis?

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: I mean, it’s a thesis that feels sort of evident in the numbers today. But what again, it is missing is what can we do to wrap around this core platform that brings that margin level to where we’re comfortable more comfortable operating. And right now, as we garner and grab the confidence of these particular customers, as we move forward, our builds, our reliability, our systems designs are the best. And when we add into the other products, we have already seen this by learnings. We think that we’ll be in an even better position downstream.

And so those factors will kind of wash themselves out.

Brandon Nispel, IT hardware coverage, KeyBank: Got it. The technology is changing so fast too. Mean the video comes up with a new GPU every year it seems. How do you think about sort of the company’s inventory position in terms of, you know, you’ve had some inventory write downs. How do think the inventory position is?

And how does that sort of speed of technology change play a role?

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: So I’ll hit on the speed of technology first because in the speed of technology and the changes, literally, like, a quarter to quarter builds are are are they’re not all the same. Right? So the product is, like, we’re we’re delivering might not always be the same. So, you know, it’s easy. The platitude is, you’re you’re making a widget, widget costs X and P times Q, right?

It’s way more complicated than that. So we are managing through that. We’re managing through the inventory element as well so that we have the right balance for the customer at the time because we don’t want to be stuck with parts that we can’t use. But at the same time, we’re trying to be expansive to be able to offer the solutions to a broad base of customers. And if you look forward and we think that there’ll be some inference platform that becomes more standardized than a volume production where we have the volume capacity to like be very cost efficient, manage that inventory for that particular product and have that product line be super successful whereas people might not even have it on the floor available yet, we’ll wrap that around with the DCBBS.

So it’s a complicated challenge, but we’ve been dealing with this for many, many years and been very proficient at it. And so we have our eye on this, and we are expecting to manage that successfully into the future.

Brandon Nispel, IT hardware coverage, KeyBank: Any questions from the audience? Yes.

Unidentified speaker: When you talk about cooling solutions as a special purpose built when you work with ISVs, but overall, how are your cooling solutions being adopted by your customers? Is there anything specific you can tell us about kind of how it evolves? And then also, is it like any vertical kind of specialties with those?

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: All right. Yes. So from that perspective, on the liquid cooling front, we believe we continue to lead the march there. Every system that we look at that needs a liquid cooling, like, literally will have some sort of change element to it. We’re constantly we’ll have DLC2 that’s, I believe, we made an announcement with the HCX platform where we’ll be able to bring a much more efficient cooling element to platform.

There’s no impedance on the dielectric fluid that we’re going to be using that will increase the confidence rate of customers that are not willing to like use liquid cooling because they’re nervous about some element of reliability. So we have super reliable systems. We’re making them even better. So we continue to innovate, like I said before, and the liquid cooling element of our solution is encapsulated in basically what the core of the platform is. We’re core compute in the data center, right?

And so we’ll expand upon that, but the liquid cooling is an element of the core compute. So when a customer comes to us, it’s like, well, give us the compute platform and we’re going to go get the cooling somewhere else. They want it all wrapped up and together and integrated. So our ability to innovate and integrate the liquid cooling solution using DLC two and advancement where we’re taking all the heat out of the system, whereas before, we’re just taking heat out of the chips is more efficient. So a customer can get more watts on the floor whether they’re whether it’s retrofit, air cooled, liquid cooled solution or whether it’s just pure liquid cooled.

So we’re constantly making advancements in this front.

Brandon Nispel, IT hardware coverage, KeyBank: Got it. Another question.

Unidentified speaker: If you had two or four more large scale customers, will you need to do another capital raise? Or are those behind you?

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: Well, that’s a great question because we ran the business the prior year. We got to 22,000,000,000 roughly $2,000,000,000 capital base. So we have $5,200,000,000 in cash. We have access to $1,790,000,000 from the AR credit facility. So $7,000,000,000 roughly of liquidity should support future growth, and we’re very mindful Charles is very mindful of dilution, and we’re going manage that quite effectively.

Part of that was in the convert, 2,300,000,000.0 raise. We bought some shares in to limit the impact and the cap call conversion premium is like 81.78 to limit the dilution. So we have a strong eye on that and we have plenty of capital to address the needs of the customers as we move forward to support the ’33 and beyond.

Brandon Nispel, IT hardware coverage, KeyBank: Got it. Any other questions from the audience? And with one, we’ve talked a lot about sort of the neo clouds expansion of that customer set, right, and sovereigns. How do you think about the enterprise as a big channel for you?

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: So the enterprise is a focus. We mentioned that on the call. The enterprise customers are fantastic. They tend to be really nice repeat customers. The ones that are technology forward happen to be our favorites because we can build to their needs.

Like Tesla is an enterprise customer. There’s lots of others under the covers. We have a lot of the enterprise customers are using the neo cloud services to test out, right? So they know under the covers that Super Micro is powering a lot of these things. So by virtue of our success with some of our neo cloud customers and some of the other enterprise customers, we’re well known.

We’re getting more opportunities, chances to bid. So we’re scaling up the go to market strategy for the enterprise to offer those customers the solutions that we have. We give them the greatest choice. So one solution is no longer like a nest like serial compute. Yes, sure.

It’s super commoditized, right? As we move forward, it will be a little bit different. Each industry vertical has a different kind of use case. I think our largest partner suggested that. So whether it be digital twins, whether it be in the bio industry, drug discovery, there are lots of different use cases, and we’re optimizing for each one of those.

And we think there’s a lot of opportunity. And those customers will need the DCBS support that we talked about. At the same time, they don’t quite have the scale purchasing power that some of the handful scale customers will have. So the pricing environment should be should balance itself out.

Brandon Nispel, IT hardware coverage, KeyBank: Margin, more margin accretive?

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: Yes, more we should be margin accretive, yes, absolutely. Well,

Brandon Nispel, IT hardware coverage, KeyBank: with that, we’re just about out of time. So Michael, thank you very much for being here. And everybody, thanks for your participation.

Michael Stager, Senior Vice President of Corporate Development, SuperMicro: Yes. Thank you.

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