The Super Micro Computer logo was photographed at the world's largest computer and technology trade show in Taipei, Taiwan on May 30, 2023.
Anne Wang | Reuters
Super Micro Computer's stock fell on Tuesday after the company announced a new stock offering, joining one of the biggest stock gains associated with the artificial intelligence boom.
The company said in a Tuesday morning filing that it plans to sell an additional 2 million shares of its common stock, bringing the total number of outstanding shares to more than 58 million.
The stock price fell 10% during pre-market trading.
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Super Micro, 1 day use
“The primary purpose of this offering is to obtain additional capital to support our operations, including the purchase of inventory and other working capital purposes, expansion of manufacturing capacity, and increased research and development (“R&D”) investment. ”, the application states.
Goldman Sachs is the underwriter for the new stock issue. Goldman also has an option to buy up to 300,000 additional shares of Supermicrocomputer stock within the next 30 days.
Technology infrastructure companies have become one of the biggest winners of Wall Street's AI investment appetite. The company's stock had risen more than 900% over the past year before Tuesday's drop, outpacing even Nvidia.
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Super microcomputer, YTD
Recent advances in AI, including large-scale language models such as ChatGPT, require increased computing power and data storage. As a result, investors have begun to focus on chip makers such as Nvidia and server infrastructure companies such as Super Microcomputer as the beneficiaries of the first wave.
Super Micro Computers is a fast-growing company, but it's still relatively small compared to tech giants whose stock prices are also rising due to interest in AI. The company reported fourth-quarter net sales of $3.66 billion, an increase of more than 100% year over year. It generated nearly $300 million in net income.
Supermicrocomputers, in particular, has seen some insiders sell their shares in recent months. CEO Charles Liang sold about 1,000 shares belonging to his spouse in January. Director Daniel Fairfax has sold 900 shares in three days so far this year.
The sale of both Liang and Fairfax was part of a formal stock sale plan, according to VerityData and filings. However, other transactions, including the sale of 5,000 shares from director Sherman Tuan, do not appear to have been part of such a plan.
Director Shiu Leung Chan purchased 2,000 shares on February 1st, but resigned as director on March 11th. Supermicrocomputer said his resignation was to focus on family business projects and was unrelated to any disagreements with the company.