SMCI
Super Micro Computer, Inc.
Technology · Computer Hardware · United States · Stock
Score Breakdown
Scored for Aggressive Growth profile
Sub-scores are 0–20 each; Model Score is weighted by your selected investment goal. How it works →
Why Ranked Here
- The composite score of 46.7/100 reflects a mixed picture: strong revenue growth and an exceptionally clean balance sheet are offset by declining net income, thin margins, and no dividend income [growth.revenue.yoy, growth.net_income.yoy, financial_health.debt_to_equity, dividend.none].
- The absence of a dividend and a zero score on thematic assignment both contributed nothing to the composite, structurally limiting how high the total score could reach despite strong top-line performance [dividend.none, theme.assigned].
- Volatile but improving quarterly earnings produced a mid-range momentum score, as the sharp revenue pullback in 2026Q3 relative to 2026Q2 tempered an otherwise encouraging profitability recovery [momentum.revenue_quarterly, momentum.net_income_quarterly].
Why Not Higher
- Profitability metrics — a 4.8% net margin, 5.7% operating margin, and 7.5% return on assets — are below the levels typically associated with higher-scoring technology hardware peers, capping the profitability contribution to the score [profitability.net_margin_pct, profitability.operating_margin_pct, profitability.roa_pct].
- The simultaneous decline in net income (-9.0%) and diluted EPS (-12.5%) alongside revenue growth signals a quality-of-earnings concern that the model penalized, preventing a higher growth score [growth.net_income.yoy, growth.eps_diluted.yoy].
Data Confidence
8 / 10
High — most data fields present
Why This Score
Grounded in figures from this company's SEC EDGAR filings — not a restatement of the score itself.
Revenue grew from FY2024's $14,989,251,000 to FY2025's $21,972,042,000, a gain of +46.6%, but net income declined from FY2024's $1,152,666,000 to FY2025's $1,048,854,000 (-9.0%), and diluted EPS fell from FY2024's $1.92 to FY2025's $1.68 (-12.5%).
The model rewarded the substantial top-line expansion but penalized the simultaneous contraction in profitability and per-share earnings, producing a mid-range growth score that reflects the mixed quality of that expansion.
In FY2025, SMCI reported a net margin of 4.8%, an operating margin of 5.7%, and a return on assets of 7.5%.
These margins are relatively thin for a high-revenue technology hardware company, and the model's mid-range score reflects that while the business is profitable, its margin profile does not reach the levels typically associated with higher-scoring peers.
SMCI carried a debt-to-equity ratio of just 0.02 in FY2025, against total assets of $14,018,429,000 in FY2025.
An extremely low debt-to-equity ratio signals that the company is operating with minimal financial leverage relative to its equity base, which the model rewarded with a high financial health score.
Quarterly revenue dipped from 2025Q4's $5,756,911,000 to 2026Q1's $5,017,790,000 before surging to 2026Q2's $12,682,491,000 and then pulling back to 2026Q3's $10,243,014,000. Operating income followed a similar pattern, falling to 2026Q1's $182,256,000, then rising sharply to 2026Q2's $474,298,000 and further to 2026Q3's $625,868,000. Net income likewise recovered from 2026Q1's $168,285,000 to 2026Q3's $483,387,000.
The model sees a volatile but ultimately upward-trending earnings trajectory over the most recent quarters; the sharp revenue pullback in 2026Q3 relative to 2026Q2 tempers the momentum signal even as profitability continued to improve, producing a mid-range score.
Super Micro Computer does not currently pay a dividend; this is a genuine characteristic of the company, not a data limitation.
Because the model rewards dividend income and payout history, a confirmed non-payer receives the minimum score on this factor.
SMCI is assigned to the macro themes of AI Infrastructure and Data Centers & Cloud Infrastructure.
Although the company carries two high-profile thematic assignments, this assignment did not translate into a positive score under the model's current methodology; the thematic classification reflects the company's business focus but the scoring component did not award points in this instance.
Research Summary
AI-generated analysis reflects data and conditions as of the report date shown above. Verify any specific figures through primary sources before acting on this analysis.
Super Micro Computer delivered exceptional top-line growth of +46.6% year-over-year, with revenue rising from $14,989,251,000 in FY2024 to $21,972,042,000 in FY2025, but this expansion came alongside a -9.0% decline in net income and a -12.5% drop in diluted EPS, signaling that profitability did not keep pace with scale. Margins remain thin, with a net margin of 4.8% and an operating margin of 5.7% in FY2025, though the balance sheet is exceptionally clean with a debt-to-equity ratio of just 0.02. Recent quarterly results show a volatile but improving earnings trajectory, while the absence of a dividend and a zero score on thematic assignment weighed on the composite, producing a total model score of 46.7/100 and a 'Research Further' label.
Plain English
SMCI is growing its sales very fast — nearly 47% in one year — but it's actually making less profit per share than before, its margins are thin, and it doesn't pay any dividends, which is why the overall score lands in the middle of the range.
Bull Case vs. Bear Case
Bull Case
- Revenue surged +46.6% year-over-year to $21,972,042,000 in FY2025, demonstrating that demand for SMCI's products is scaling rapidly [growth.revenue.yoy].
- The balance sheet is extremely conservative, with a debt-to-equity ratio of just 0.02 against total assets of $14,018,429,000, giving the company significant financial flexibility [financial_health.debt_to_equity, financial_health.total_assets].
- Recent quarterly operating income has been on an upward trend, rising from $182,256,000 in 2026Q1 to $625,868,000 in 2026Q3, suggesting improving operational efficiency even amid revenue volatility [momentum.operating_income_quarterly].
Bear Case
- Despite strong revenue growth, net income fell -9.0% and diluted EPS dropped -12.5% from FY2024 to FY2025, indicating that top-line expansion is not translating into better returns for shareholders [growth.net_income.yoy, growth.eps_diluted.yoy].
- Net and operating margins of 4.8% and 5.7% respectively in FY2025 are thin for a high-revenue technology hardware company, leaving little buffer against cost pressures or pricing headwinds [profitability.net_margin_pct, profitability.operating_margin_pct].
- Quarterly revenue swung sharply — from $5,017,790,000 in 2026Q1 up to $12,682,491,000 in 2026Q2 and then back down to $10,243,014,000 in 2026Q3 — reflecting a high degree of revenue volatility that complicates forward planning [momentum.revenue_quarterly].
What Could Change the Picture
Bullish Triggers
- A sustained improvement in net and operating margins alongside continued revenue growth would signal that SMCI is converting its scale into durable profitability [profitability.net_margin_pct, profitability.operating_margin_pct].
- If quarterly revenue stabilizes at or above the levels seen in 2026Q2 and operating income continues its upward trend, the momentum signal would strengthen considerably [momentum.revenue_quarterly, momentum.operating_income_quarterly].
Bearish Triggers
- A reversal in the recent operating income recovery — particularly if margins compress further from already-thin levels — would raise concerns about the sustainability of the business model [profitability.operating_margin_pct, momentum.operating_income_quarterly].
- Any meaningful increase in leverage from the current near-zero debt-to-equity ratio of 0.02 could erode the financial health advantage that currently supports the composite score [financial_health.debt_to_equity].
Red Flags
- ONE_TIME_REVIEW: 2022 OCF/NI ratio = -1.55 (OCF=-440,801,000, NI=285,163,000) — possible large one-time item
- ONE_TIME_REVIEW: 2024 OCF/NI ratio = -2.16 (OCF=-2,485,972,000, NI=1,152,666,000) — possible large one-time item
Risk Profile
Low RiskSMCI's financial risk profile is low, anchored by a debt-to-equity ratio of just 0.02 and total assets of $14,018,429,000, meaning the company carries minimal financial leverage. However, the high volatility in quarterly revenues — ranging from $5,017,790,000 to $12,682,491,000 across recent quarters — represents an operational risk that investors should monitor closely.
This report is for educational and research purposes only. It does not constitute financial, investment, legal, or tax advice — always conduct your own due diligence before making investment decisions.