Super Micro Computer, Inc. (NASDAQ:SMCI)

Second Quarter 2015 Results

• Quarterly net sales of $503.0 million, up 13.5% from the first quarter of fiscal year 2015 and up 41.2% from the same quarter of last year. Beat analyst revenue estimates of $467.8.
  

• non-GAAP net income for the second quarter was $33.5 million, or $0.65 per diluted share, compared to non-GAAP net income of $15.9 million, or $0.35 per diluted share, in the same quarter of the prior year. Beat analyst EPS estimates of $0.47
  

Business Outlook & Management Commentary

The Company expects net sales of $450 million to $500 million for the third quarter of fiscal year 2015 ending March 31, 2015. The Company expects non-GAAP earnings per diluted share of approximately $0.46 to $0.52 for the third quarter.

“Last quarter we achieved our fifth consecutive record high revenue which was 41.2% higher than last year and we reached our goal of $2 billion annual run rate for revenues in a quarter. Not only was this quarter outstanding from a revenue perspective, but we also continued to improve our operating margin. This performance was driven by a significant increase in our new Haswell product shipments in the first full quarter since its launch, and we are confident that a strong cycle of technology transition is underway. Strength in Storage and Cloud market verticals were part of a record for server systems revenue at 60.1%,” said Charles Liang, Chairman and Chief Executive of Supermicro. “Supermicro has the broadest product portfolio of application optimized server/storage technology in the industry featuring our Ultra line of servers as well as many choices for multi-node servers including our Twin architecture, Blades, MicroCloud and MicroBlade. We are well positioned for growth and market share gains.”

First Quarter 2015 Results

• Quarterly net sales of $443.3 million, up 3.6% from the fourth quarter of fiscal year 2014 and up 43.5% from the same quarter of last year.
• non-GAAP net income for the first quarter was $23.2 million, or $0.46 per diluted share, compared to non-GAAP net income of $9.9 million, or $0.22 per diluted share, in the same quarter of the prior year.

The Company expects net sales of $440 million to $480 million for the second quarter of fiscal year 2015 ending December 31, 2014. The Company expects non-GAAP earnings per diluted share of approximately $0.44 to $0.50 for the second quarter.

“We began fiscal 2015 with an exceptional first quarter of record revenue and profits. In the first quarter, we grew revenues 43.5% over last year and posted our fourth consecutive quarter of record results. This again outperformed multiple times the industry growth rate. With 57.7% of our revenue coming from systems based on our Storage, GPU/Xeon Phi, Twin, MicroCloud and Network Switches, we continue to improve margin through a mix of higher value system products," said Charles Liang, Chairman and CEO. “As we ship our latest X10 generation Haswell DP products, a brand new I/O optimized Ultra server architecture and industry-leading hot-swappable NVMe solutions, we are confident our technology innovation will continue to drive our growth momentum into the remainder fiscal 2015."

Fourth quarter 2014 Results

• Quarterly net sales of $428.1 million, up 14.5% from the third quarter of fiscal year 2014 and up 32.8% from the same quarter of last year.
• non-GAAP net income for the fourth quarter was $19.4 million, or $0.40 per diluted share, compared to non-GAAP net income of $11.3 million, or $0.26 per diluted share, in the same quarter of the prior year.

The Company expects net sales of $395 million to $435 million for the first quarter of fiscal year 2015 ending September 30, 2014. The Company expects non-GAAP earnings per diluted share of approximately $0.36 to $0.42 for the first quarter.

“In the fourth quarter, we achieved $428.1 million revenue or 32.8% growth over last year which marked the third straight quarter of record revenues and keeps us on a path to reach our goal of achieving $2 billion annual run rate in the coming fiscal year 2015. Revenue growth was driven by higher sales into virtualization and cloud applications to internet data centers totaling 17.8% of fourth quarter revenue or 150% higher than last year which helped us to achieve record revenue for system sales of 55.2% of revenue. With this strong revenue growth combined with operating expense leverage, we achieved record profits,” said Charles Liang, Chairman and CEO. “We are looking forward to the new fiscal year and we have been preparing to be a strong market leader in the upcoming technology refresh cycle related to the Intel Grantley (Haswell new processor) launch. We have created new X10 based product lines optimized for Grantley which includes our new Ultra server architecture, our new Data Center Optimized line, and our TwinPro line to just name a few of the many products that will lead the industry in innovation and time to market.”

Third Quarter Fiscal 2014 Results

• Quarterly net sales of $373.8 million, up 34.4% from the same quarter of last year.
• Non-GAAP EPS was $0.37 per diluted share, compared to $0.23 per diluted share in the same quarter of the prior year.

Business Outlook

The Company expects net sales of $370 million to $410 million for the fourth quarter of fiscal year 2014 ending June 30, 2014. The Company expects non-GAAP earnings per diluted share of approximately $0.35 to $0.41 for the fourth quarter.

“Supermicro’s third quarter was a second straight quarter of record highs for revenue and earnings. Revenues were 34.4% higher year over year with strong growth coming from North America and from internet data centers. We grew again in multiples of the industry growth rate, expanded market share, and continued to lead the industry in system innovation and time to market,” said Charles Liang, CEO and President of Super Micro. “As we extend our business model to provide more complete solutions including software and maintenance support together with our global operations, we are prepared to drive Supermicro to increased sales momentum in 2014.”

SAN JOSE, Calif., March 31, 2014 /PRNewswire/ -- Super Micro Computer, Inc. (NASDAQ: SMCI), a global leader in high-performance, high-efficiency server, storage technology and green computing is exhibiting its latest embedded building block solutions at EE|Live!, Embedded Systems Conference (ESC) 2014 in San Jose, California this week. Supermicro will highlight Battery Backup Power (BBP®) solutions for mission critical embedded applications alongside compact, low-power Intel® Atom™ based general purpose server, network security and communications embedded appliances. Compact 1U rack and BoxPC appliances for light workload server and mobile solutions and a range of compact, cost effective single and high-performance, feature rich dual processor motherboards will be on display. AMD Opteron™ 3300 (AM+) and 4300 (C32) based servers for communications and security applications will also be exhibited at ESC. 

"Supermicro brings Enterprise-class stability, performance and energy efficiency to our Embedded Solutions product lines," said Charles Liang, President and CEO of Supermicro. "Our new BBP solutions for mission critical embedded applications offer a graceful shutdown period for maximum protection against data loss in unexpected power outage events. With the industry's widest selection of embedded server building blocks, customers in engineering, manufacturing, infrastructure and security have more choice to design in solutions that meet the most demanding requirements while delivering maximum flexibility and reliability."

Second Quarter Fiscal 2014 Results

• Quarterly net sales of $356.4 million, up 22.3% from $291,487 in the same quarter of last year.
• The company reported non-GAAP EPS of $0.35, compared to $0.18 for the same quarter of last year.

Business Outlook

The Company expects net sales of $320 million to $350 million for the third quarter of fiscal year 2014 ending March 31, 2014. The Company expects non-GAAP earnings per diluted share of approximately $0.24 to $0.30 for the third quarter.

“Supermicro’s second quarter was a record high for revenue and earnings. We grew revenue 22.3% higher than last year with significant jump in Asia revenues to 23% of revenues. Our Twin family, especially the FatTwin, storage and GPU/Xeon Phi product lines were strong drivers to revenue growth,” said Charles Liang, CEO and President of Supermicro. “We are looking forward to strong growth in calendar 2014 because of our foundation in global capacity and in strong product innovation with upcoming launches of our TwinPro series with SAS 3 and NVMe and with MicroBlade, the industry’s densest low power server.”

It is currently expected that the outlook will not be updated until the Company’s next quarterly earnings announcement, notwithstanding subsequent developments. However, the Company may update the outlook or any portion thereof at any time. Such updates will take place only by way of a news release or other broadly disseminated disclosure available to all interested parties in accordance with Regulation FD.

First Quarter 2014 Results

• Net sales for the first quarter ended September 30, 2013 totaled $309.0 million, down 4.1% from $322.3 million in the fourth quarter of fiscal year 2013.
• Non-GAAP net income for the first quarter was $9.9 million, or $0.22 per diluted share, compared to non-GAAP net income of $3.1 million, or $0.07 per diluted share, in the same quarter of the prior year.

Business Outlook & Management Commentary 

The Company expects net sales of $320 million to $350 million for the second quarter of fiscal year 2014 ending December 31, 2013. The Company expects non-GAAP earnings per diluted share of approximately $0.25 to $0.31 for the second quarter.

“Our first quarter results continued our growth momentum for the start of this new fiscal year by growing revenue 14.2% year over year. Our FatTwin and MicroCloud solutions for data centers were in strong demand and our GPU, Xeon Phi and storage solutions continue to outperform the industry. We are pleased with our performance given the transition period ahead of new technology. We are also pleased that we are making good progress toward reaching our margin goals,” said Charles Liang, Chairman and CEO. “Looking ahead, we are again first to market with the broadest array of new Ivy Bridge solutions in the industry and we will use this position together with our global foundation to take full advantage of the market share opportunities.”

Fourth Quarter 2013 Results

• Quarterly net sales of $322.3 million, up 15.9% from the third quarter of fiscal year 2013 and up 16.8% from the same quarter of last year.
• Non-GAAP net income for the fourth quarter was $11.3 million, or $0.26 per diluted share, compared to non-GAAP net income of $8.1 million, or $0.18 per diluted share, in the same quarter of the prior year.

“The fourth quarter was a record high for Supermicro with growth at 16.8% higher year over year and which again outpaced the industry's growth rate. Virtually all market segments delivered strong growth from our rackmount servers and especially our FatTwin line of servers to our storage, blade, GPU, MicroCloud and switches,” said Charles Liang, CEO and Chairman. “We start a new fiscal year with the strongest product lines in our history and with our global operations ready for growth. We believe that with this strong foundation we will continue our growth trend in fiscal 2014.”

Outlook:

The Company expects net sales of $295 million to $315 million for the first quarter of fiscal year 2014 ending September 30, 2014. The Company expects non-GAAP earnings per diluted share of approximately $0.17 to $0.23 for the first quarter.

Second Quarter 2012 Results

• Quarterly net sales of $249.9 million, up 0.8% from the first quarter of fiscal year 2012 and up 3.8% from the same quarter of last year.
• Net income of $8.8 million, up 3.3% from the first quarter of fiscal year 2012 and down 24.2% from the same quarter of last year.
• Gross margin of 17.1%, up from 16.0% in the first quarter of fiscal year 2012 and up 0.4% from the same quarter of last year.
• Server Solutions accounted for 44.0% of net sales compared with 39.4% in the first quarter of fiscal year 2012 and 40.5% in the same quarter of last year.

The Company expects net sales of $240 million to $270 million for the third quarter of fiscal year 2012 ending March 31, 2012. The Company expects non-GAAP earnings per diluted share of approximately $0.19 to $0.27 for the third quarter.

"We've previously said that the third fiscal quarter was challenging principally due to impact on the hard disk drive supply chain resulting from the flooding in Thailand. We are continuing to work with our vendors to recover hard disk drive supplies that will help us meet the strong growing demand for our products," said Charles Liang, CEO of Supermicro. "2012 will be a significant year to us due to the coming launch of Sandy Bridge. During the quarter, we continued our R&D investment to be able to offer the broadest product offering in the industry for the Sandybridge launch. Also, we opened our new Taiwan facility which will increase our efficiency and lower the cost to deliver products to our customers. Backlog for our products is high. We are confident that our new product architectures including Fat Twin and full digital power subsystem and expansion of our production will provide broad opportunity for us in the coming quarters."

• Quarterly net sales of $247.9 million, down 4.8% from the fourth quarter of fiscal year 2011 and up 19.6% from the same quarter of last year.
• Gross margin of 16.0%, up from 15.4% in the fourth quarter of fiscal year 2011 and up 0.1% from the same quarter of last year.
• Server Solutions accounted for 39.4% of net sales compared with 40.4% in the fourth quarter of fiscal year 2011 and 35.7% in the same quarter of last year.
• Net income for the first quarter of fiscal year 2012 was $8.5 million or $0.19 per diluted share, an increase of 17.7% from the net income of $7.2 million, or $0.17 per diluted share in the same period a year ago. Included in net income for the quarter is $2.3 million of stock-based compensation expense (pre-tax).
• Excluding this item and the related tax effect, non-GAAP net income for the first quarter was $10.5 million, or $0.24 per diluted share, compared to non-GAAP net income of $9.3 million, or $0.22 per diluted share, in the same quarter of the prior year. On a sequential basis, non-GAAP net income decreased from the fourth quarter of fiscal year 2011 by $2.5 million or $0.05 per diluted share.

Business Outlook & Management Commentary

• The Company expects net sales of $260 million to $280 million for the second quarter of fiscal year 2012 ending December 31, 2011.
• The Company expects non-GAAP earnings per diluted share of approximately $0.27 to $0.33 for the second quarter.

“Supermicro had a strong beginning to our new fiscal year with first quarter revenues 19.6% higher than last year. We continued to have strong system business as our growing customers like total solutions from Supermicro,” said Charles Liang, Chairman and CEO. “This quarter was one of further developing our foundation by preparing our product lines for Sandy Bridge processor and by improving our production capacity and logistics as our Taiwan facility nears completion.”

It is currently expected that the outlook will not be updated until the Company’s next quarterly earnings announcement, notwithstanding subsequent developments. However, the Company may update the outlook or any portion thereof at any time. Such updates will take place only by way of a news release or other broadly disseminated disclosure available to all interested parties in accordance with Regulation FD.

Third Quarter Results:

• Net sales for the third quarter ended March 31, 2011 totaled $234.3 million, up 23.8% from $189.3 million in the third quarter of fiscal year 2010. No customer accounted for more than 10% of net sales during the quarter.
• non-GAAP net income for the third quarter was $12.3 million, or $0.28 per diluted share, compared to non-GAAP net income of $8.9 million, or $0.21 per diluted share, in the same quarter of the prior year
• The Company expects net sales of $245 million to $260 million for the fourth quarter of fiscal year 2011 ending June 30, 2011. The Company expects non-GAAP earnings per diluted share of approximately $0.28 to $0.30 for the fourth quarter.

"We are pleased that our third quarter revenues were 24% higher and earnings were 38% higher than last year. The growth momentum of our storage and blade product lines as well as our growth in Asia has delivered significant results in this quarter and over the last year," said Charles Liang, Chairman and CEO. "We are preparing for growth in the upcoming quarters with investments in our industry leading technology for upcoming launches. We are also continuing to invest in capacity in Asia in order to meet the significant demand for our products worldwide."

SMCI EPS grew 250.0% yet the stock was pummeled. In addition to only slightly exceeding analyst estimates, we believe that the problem might have to do with two reasons:

    -EPS guidance for its next quarter is one penny shy of estimates.
    -The company has commented it is not issuing guidance for 2011 yet.
   
Regardless, comments were strong.

The Company expects net sales of $192 million to $202 million for the fourth quarter of fiscal year 2010 ending June 30, 2010. This quarter we have a good boost because of the new product transition which started last quarter. In addition, this is historically a strong seasonal quarter; the Company expects non-GAAP earnings per diluted share of approximately $0.20 to $0.23 for the fourth quarter.

“We achieved another record high of quarterly revenues, which is the 4th straight quarter of increasing revenues, making the first 9 months of fiscal 2010 the strongest performance in our history. Supermicro has strong momentum going into the June quarter because of our growing brand strength, important OEM wins, new Westmere and G34 product launches, and growing revenue opportunities in Europe and Asia. Our global expansion to meet our worldwide demand now includes production capacity in Europe as well as our first production in Taiwan, which was added during the quarter. We expect our strong growth trend to continue into the June quarter and beyond,” said Charles Liang, CEO and President.

It is currently expected that the outlook will not be updated until the Company’s next quarterly earnings announcement, notwithstanding subsequent developments. The Company may update the outlook or any portion thereof at any time. Such updates will take place only by way of a news release or other broadly disseminated disclosure available to all interested parties in accordance with Regulation FD.