Super Micro hires new auditor to maintain Nasdaq listing; shares pop

Combat server maker Super micro computer said on Monday that it has hired BDO as its new auditor and submitted a plan to Nasdaq outlining its efforts to regain compliance with the exchange. Shares rose 23% in extended trading.

“This is an important next step in bringing our financial statements current, an effort we are pursuing with both diligence and urgency,” Super Micro CEO Charles Liang said in a declaration.

Super Micro is late filing its 2024 annual report with the SEC and said earlier this month that it was looking for a new auditor after its previous auditor, Ernst & Young, resigned in October. Ernst & Young was new to the job and had just replaced Deloitte & Touche as Super Micro’s audit firm in March 2023.

Super Micro said it told Nasdaq it believes it will be able to file its annual report for the year ended June 30 and the quarterly report for the period ended Sept. 30. The company said it will remain listed on Nasdaq pending the exchange’s “review of the compliance plan.”

Shares in Super Micro rose more than twenty times over a two-year period from early 2022 to their peak in March this year. But the stock has been hammered on troubling news about its Nasdaq compliance. Once valued at around $70 billion, the company’s market capitalization was $12.6 billion at the close on Monday, after rising 16% in regular trading.

Super Micro has been one of the primary beneficiaries of the artificial intelligence boom because of its relationship with Nvidia. Sales last fiscal year more than doubled to $15 billion.

On Monday, Super Micro announced that it is selling products with Nvidia’s next-generation AI chip called Blackwell. The company competes with suppliers such as Dell and Hewlett Packard Enterprise in packaging Nvidia AI chips that other companies can access.

Super Micro was added to the S&P 500 in March, reflecting its fast-growing business and then-rising stock price. Less than two weeks after the index changes were announced, Super Micro hit its closing high of $118.81.

The problems began within months. In August, Super Micro said it would not file its annual report with the SEC on time. Prominent short-seller Hindenburg Research then disclosed a short position in the company, saying in a report that it identified “new evidence of accounting manipulation.” The Wall Street Journal later reported that the Justice Department was in the early stages of an investigation into the company.

The month after announcing its report delay, Super Micro said it had received a notice from Nasdaq indicating that the delay in submitting the annual report meant the company was not in compliance with the exchange’s listing rules. Super Micro said Nasdaq rules allowed the company 60 days to file its report or submit a plan to regain compliance. Based on that time frame, the deadline was Monday.

CLOCK: Super Micro is a sale due to accounting irregularities