Shares of Super Micro Computer Inc. experienced a remarkable surge of approximately 40% in after-hours trading on The Nasdaq Stock Market. This significant jump followed the announcement that the beleaguered server manufacturer had appointed a new auditor and submitted a compliance plan to the stock exchange in an effort to prevent its delisting.
The compliance plan was designed to bolster Supermicro's appeal for additional time to meet Nasdaq's continued listing specifications. Consequently, the company's securities will remain listed while Nasdaq evaluates the proposed plan.
In a company statement, Supermicro, known for providing comprehensive IT solutions across AI, Cloud, Storage, and 5G/Edge technologies, declared that its board's Audit Committee has engaged BDO USA, P.C., a BDO International member firm, as its independent auditor, with immediate effect.
The delay in filing its 2024 year-end report with the U.S. Securities and Exchange Commission has been a point of concern for Super Micro. The delay followed the resignation of its previous auditor, Ernst & Young, in October. EY's departure was attributed to concerns over governance, transparency, and communication completeness, prompting a significant decline in the company's share value.
Earlier in the month, Supermicro revealed its intent to appoint a new auditor to facilitate the completion of its Annual Report filing. In its compliance plan submitted to Nasdaq, the company assured it could file its annual report on Form 10-K for the fiscal year ending June 30 and its quarterly report on Form 10-Q for the quarter ending September 30. Furthermore, Supermicro projects it will align with its routine reporting obligations within the discretionary timeframe available for Nasdaq staff approval.
Charles Liang, President and CEO of Supermicro, emphasized, "BDO is a highly regarded accounting firm with global capabilities. This marks a crucial step towards updating our financial statements, which we approach with both diligence and urgency."
The company, capitalizing on the ongoing AI boom, has partnered with AI chipmaker Nvidia to introduce products featuring Nvidia's advanced AI chip, Blackwell. In recognition of its swiftly expanding business and stock price growth, Supermicro was incorporated into the S&P 500 in March, replacing Whirlpool Corp.
However, in August, Supermicro announced it would not timely submit its annual report to the SEC. This period coincided with a short seller, Hindenburg Research, disclosing a short position in the company while alleging evidence of "accounting manipulation."
Subsequently, reports indicated the Department of Justice was initiating an investigation into Supermicro. Amid these challenges, on September 20, Supermicro disclosed it had received a notification from Nasdaq regarding non-compliance with Nasdaq's listing requirements mandating timely report filings.
Under Nasdaq's rules, the company faced a Monday deadline to either file its reports or present a plan to re-establish compliance within 60 days.
On Monday, Supermicro's shares increased by roughly 16% during regular trading, closing at $21.54. In extended trading, the shares soared by 39.8%, reaching $30.11.
