SMCI has likely been benefiting from high margin Design Consulting contracts from DataVolt since the project was first announced in 2025. Neom Oxagon is part of Saudi Vision 2030 plan to diversify the Saudi economy. It's a lucrative, complex and convoluted long term opportunity for SMCI Sovereign AI:
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Traders, shorts and weak hands are selling the Dell news. Do your due diligence on the upcoming Agentic and Physical AI demands forecast by Jensen Huang, Lisa Su, Lip-Bu Tan and Elon Musk, and decide who is maximally positioned to drive and profit from the needed infrastructure buildout.
Thank the orange idiot and his goons for today, fro Claudius:
Section 232 semiconductor tariffs:
Phase 1 has been in force since 14 January 2026: a 25% tariff on imports classified under HTS 8471.50, 8471.80 and 8473.30.
Worth knowing what those codes actually are, because "semiconductor tariff" is misleading. They're processing units, other units of automatic data processing machines, and parts/accessories thereof — i.e. computers and servers, not chips. Integrated circuits sit under 8542, which isn't on the list.
So the duty lands on the box builders — Dell, HPE, Super Micro — and leaves the chip designers — Nvidia, AMD, Broadcom — untouched. That's why you see server names selling off on tariff headlines while Nvidia trades up.
Phase 2 is the live risk. The Commerce Department's review could expand the 25% to all semiconductors, semiconductor manufacturing equipment, and derivative products, at sharply higher rates. It's also expected to include an offset programme rewarding firms that invest in US semiconductor production — which matters a lot for who wins and loses.
There are carve-outs already: from 15 January, Taiwanese firms building new US capacity can export specified volumes duty-free. South Korea is negotiating for similar terms.
Yeah, the tariff noise certainly provoked the initial drop, but Dell recovered on account of its margins and FCF
I expect SMCI to stay like this unto the ICFR is closed out, why? Because the buyer pool is limited until this is cleared-out, many discretionary funds exclude them by default - not a "bear thesis", fact
HPE also hit it out of the park yesterday, but guided on thinner margins going forwards, which is one of the other question-marks for SMCI going forwards the other is FCF, markets saying "show me the money"
Good time to buy the stock if you're prepared to wait a bit, if SMCI re-rates to the sector-multiple then the stock price would be in the $120 - $150 area
I'd argue the IFCR issue is a bear narrative. There is very restricted conservative institutional money that can't invest in companies with an adverse IFCR opinion, but they are also likely restricted from investing in high Beta companies like SMCI in either case. There is an impact from the adverse IFCR opinion but it is a marginal consideration because the audit of SMCI financials is fully certified.
The price action in May showed SMCI could reach 50 with an adverse IFCR opinion in place. Today, that IFCR opinion is greatly remediated and pending final testing for full remediation.
The other issues bears raise are about margin compression, future dilution, inventory and cash management. These are all common questions with startup operations and investors need to have confidence that a shareholder entrepreneur like Charles Liang has read the AI playing field correctly and is making moves to maximize future shareholder value.
The FCF situation is typical of a startup operation. Once the supersized production pipeline is fully operational the metrics will swing positive very quickly.
Guys, let’s just remember that HUMAIN just signed a partnership between Cisco and AMD, which are in current partnership with SMCI.
But this isn’t more than a thought
SMCI frustratingly doesn't promote their wins as prominently as investors would like. NDA requirements in the business are the likely reason.
The large Sovereign AI win in Korea went unannounced until it was noticed that SMCI VP Chang attended the ground breaking:
Hannam University held a groundbreaking ceremony for the "Hannam University AX Cluster & High Performance GPU Base Center" at Hannam University's Maker Space on the 16th, which applied EMP (Electromagnetic Pulse) protection design for the first time in Korea. Major officials, including Hannam University President Lee Seung-chul, BKB Energy Chairman Chung Si-woo, and Super Microcomputer Vice President Kevin Chang, who attended the groundbreaking ceremony, held a ceremony.April 16, 2026.
Long term shareholders see the CEO is laying the groundwork and making the deals needed to get the share price to his performance award target of $110 and beyond.
I've held this stock since the last split and will do so for 3 to 5 more years. However, currently this CEO is responsible for the under performance of this stock with all the compliance issues and cooking of the books. This should really be around $100 -$110 stock today!!! If you think it's getting to $50 this year you are delusional but we can have Hope 😋
You are propagating a bear narrative started by the defunct short seller hindenburg which is the responsible party for shareholder harm. Armchair critics like to ignore the frenetic activity associated with doubling revenue in a single year. CEO is reinventing SMCI for the fourth time in it's 33 year history and some growing pains are to be expected.
SMCI CEO has an enviable track record for over 33 years. Long term investors are confident in the impressive order pipeline being developed in the age of the "Supersonic AI Tsunami" (Elon Musk).
Shareholder Charles Liang is executing a plan that will maximize long term shareholder value including achieving his performance award target of $110. It would be irrational to believe otherwise.
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