Sharp Decline in Super Micro Computer Inc.'s Shares

Super Micro Computer Inc. (SMCI) experienced a significant drop in its share price on Wednesday, following the company's announcement of reduced third-quarter revenue and earnings forecasts. This news led to an early trading sell-off of nearly 20%.

Revised Financial Forecasts

The server manufacturer now anticipates revenue to be in the range of $4.5 billion to $4.6 billion, a considerable decrease from its previous estimate of $5 billion to $6 billion. Similarly, adjusted earnings per share are projected to be between $0.29 and $0.31, down from the earlier forecast of $0.46 to $0.62.

Reasons Behind the Shortfall

Super Micro attributed the disappointing figures to delayed customer orders and higher inventory costs, highlighting the challenges the company faces in the current market environment.

Market Reaction

By 9:36 am ET, the company's shares had fallen by 19.13%, trading at $29.12, reflecting the market's immediate response to the revised forecasts.