WASHINGTON (AP) — Super Micro Computer lost a quarter of its value in morning trading Wednesday after the server technology company said it was delaying the filing of its annual report.
The company said in a regulatory filing that “additional time is needed for management to complete its assessment of the design and operating effectiveness of its internal controls over financial reporting as of June 30, 2024," which was the end of the company's fiscal year.
Super Micro Computer's announcement comes one day after short-selling firm Hindenburg Research said a three-month review turned up new evidence of accounting manipulation by the San Jose, California-based company. Hindenburg said it has taken a short position in the stock, meaning it's betting the price will drop.
The company's shares slid 25.2% in midday trading to $409.48. They hit an all-time high of $1,229 each on March 8 of this year.
Hindenburg accused Super Micro of rehiring top executives that were directly involved in an accounting scandal that resulted in the company being temporarily delisted by Nasdaq in 2018 for failing to file financial statements. The Securities and Exchange Commission in 2020 charged Super Micro with improper accounting for “prematurely recognizing revenue and understating expenses" beginning at least as early as fiscal 2015 to 2017. The company paid a $17.5 million civil penalty.
Super Micro has been among the technology companies recently riding a wave of enthusiasm over products and services related to artificial intelligence.
Super Micro's shares more than quadrupled in less than three months to start the year as it reported booming revenue. Earlier this month, Super Micro reported fourth-quarter revenue of $5.3 billion, a more than 143% increase over the $2.2 billion it reported in the same quarter of 2023.
Hindenburg said its investigation included interviews with former senior employees and industry experts and a review of records that “found glaring accounting red flags, evidence of undisclosed related party transactions, sanctions and export control failures, and customer issues.”
When asked for comment on the Hindenburg report, the company said in an email that it “does not comment on rumors and speculation.”
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