Dive Brief:
- AI server maker Super Micro Computer’s shares plunged 19% Wednesday after the company announced it expects to delay its 10-K filing for the fiscal year 2024 ended June 30, according to a release. It plans to file a notification of late filing on Aug. 30.
- “SMCI is unable to file its annual report within the prescribed time period without unreasonable effort or expense,” the company said in the release. “Additional time is needed for SMCI’s management to complete its assessment of the design and operating effectiveness of its internal controls over financial reporting as of June 30, 2024.”
- The announcement comes a day after Hindenburg Research released a highly critical report of the San Jose, California-based company asserting that an investigation found “glaring accounting red flags, evidence of undisclosed related party transactions, sanctions and export control failures, and customer issues.”
Dive Insight:
The report pits short-seller Hindenburg against Super Micro, which has been “one of the biggest winners of the generative artificial intelligence boom,” CNBC reported.
Analysts at JPMorgan pushed back against the short-seller’s allegations in a Tuesday note. “Net-net, we see the report as largely void of details around alleged wrong-doings from the company that change the medium-term outlook, and largely revisiting the already known areas for improvement in relation to corporate governance and transparency,” JPMorgan analysts said.
Super Micro isn’t alone in its tardiness: Early this year the number of public companies that filed late annual reports spiked 40% compared to 2023, according to a March report from Intelligize, which provides regulatory insights and analytics.
The accounting talent shortage and increased reporting requirements have pressured companies and created a “perfect storm” leading to more late SEC filings, the accounting firm UHY’s Ro Sokhi previously told CFO Dive.
Super Micro’s late filing announcement also came as investors were warily awaiting AI chip maker Nvidia’s earnings report after the close of trading Wednesday, with the options market indicating the results were expected to send the Santa Clara, California-based bellwether company’s shares 10% up or down, Bloomberg reported.
Super Micro and Hindenburg did not immediately respond to requests for comment.
