Super Micro Computer (SMCI) Q2 2025 earnings summary

Executive summary

• Q2 FY25 net sales rose 54.9% year-over-year to $5.68B, driven by strong AI demand, new customer wins, and robust GPU server sales, especially in the U.S. and Europe.

• AI-related platforms contributed over 70% of Q2 revenue, with significant momentum in enterprise and cloud service provider markets.

• Transition from Hopper to Blackwell GPU platforms underway, with volume shipments of new NVIDIA Blackwell systems beginning.

• Net income increased to $320.6M from $296.0M year-over-year; diluted EPS was $0.51, flat year-over-year; non-GAAP EPS at $0.58–$0.60, up 5%.

• Company completed a 10-for-1 stock split effective September 30, 2024.

Financial highlights

• Q2 FY25 revenue was $5.68B, up from $3.66B year-over-year; six-month revenue was $11.62B.

• GAAP and non-GAAP gross margin for Q2 was 11.8%–11.9%, down from 15.4% year-over-year.

• Operating margin for Q2 was 6.5%–7.9%, down from 10.1% prior year.

• Net income for Q2 was $320.6M–$325M; non-GAAP net income at $375M–$392M.

• Cash and equivalents at $1.4B as of Dec 31, 2024; total debt at $1.9B.

Outlook and guidance

• FY25 revenue guidance lowered to $23.5B–$25B from prior $26B–$30B, reflecting technology transition and 10-K delay impacts.

• Q3 FY25 revenue expected at $5B–$6B; GAAP and non-GAAP gross margin projected at ~12%.

• FY26 revenue target set at $40B, implying at least 65% year-over-year growth, supported by strong product pipeline and customer commitments.

• Capital expenditures for the remainder of FY25 projected at $76–86M, focused on manufacturing and facilities expansion.

• Liquidity expected to remain strong, with sufficient cash, credit, and operating cash flows to support business needs.