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Supermicro Stock Jumps After Probe Finds No Accounting Wrongdoing
Key Takeaways
Shares of Super Micro Computer ( SMCI ), or Supermicro, soared roughly 20% to lead S&P 500 gainers Monday after the troubled computer server maker announced an investigation found no misconduct in the company's accounting practices. It also said it will be replacing its finance chief.
The San Jose, Calif.-based firm said its independent special committee had finished its probe and its findings "did not raise any substantial concerns about the integrity of Supermicro's senior management or Audit Committee, or their commitment to ensuring that the Company's financial statements are materially accurate."
The accounting issues came to light when the company announced earlier this year it wasn't able to file its Form 10-K for fiscal 2024 because of the accounting questions. That led to the Nasdaq threatening to delist the firm for not adhering to market requirements. In addition, Supermicro's auditor, EY, resigned, saying that it was "unwilling to be associated with the financial statements prepared by management."
Supermicro Does Not Expect Having To Restate Results
Supermicro explained that the independent special committee concluded that EY's reasons for leaving "were not supported by the facts examined in the Review." It added that it "does not anticipate any restatements of its quarterly reports for the fiscal year 2024 ended June 30, 2024, or for prior fiscal years."
Per the panel's recommendations, Chief Financial Officer (CFO) David Weigand will be replaced as soon as a new CFO is appointed. The company noted the board has begun the process to fill that role.
The accounting concerns have sent Supermicro shares on a roller-coaster ride. They fell to their lowest level since May 2023 last month before rallying, and are now up nearly 40% year-to-date.
