Photo: Carl Lender / CC BY 2.0 (archive)
Super Micro Computer and Arista Networks reported strong sales Tuesday after the close, offering two more readings on the AI infrastructure buildout: the servers that run computing workloads and the networks that connect them. Both stocks rose in extended trading.
Supermicro posted $19.9 billion in revenue for its fiscal first quarter ended September 30, while Arista’s third-quarter revenue rose 58.5% to $3.66 billion. Their reporting periods cover the same September quarter but sit in different fiscal calendars.
Supermicro shares traded at $33.11 at 4:30pm Eastern, up $1.72, or 5.47%, from the $31.39 regular-session close, according to CNBC’s extended-hours quote. Arista traded at $181.83 at 4:29pm, up $11.92, or 7.02%, from its $169.91 close, according to CNBC’s Arista quote. These are timestamped early reactions, not final after-hours prices.
Supermicro’s sales surge, with cash flow a watch point
Supermicro’s results release showed fiscal first-quarter sales of $19.9 billion, compared with $5.0 billion a year earlier and $11.1 billion in the preceding quarter. Standard-accounting earnings were $1.75 a diluted share, versus 26 cents a year earlier; adjusted earnings were $1.81, versus 35 cents.
CEO Charles Liang attributed the record sales to the company’s expansion as a provider of complete AI and information-technology data-center systems. The company sells infrastructure intended to help customers deploy computing capacity rather than simply buying individual components.
The gross margin was 12.7%, up from 9.3% a year earlier but down from 17.5% in the June quarter. That mixed comparison matters because higher revenue does not necessarily mean each dollar of sales produces more profit.
Supermicro used $434 million of cash in operations during the quarter. It ended September with $6.9 billion in cash and cash equivalents and $8.6 billion in bank debt and convertible notes, according to the release.
For its fiscal second quarter ending December 31, the company forecast revenue of $19.5 billion to $21.5 billion, with adjusted earnings of $1.66 to $1.90 a share. Its fiscal 2027 revenue outlook is $72 billion to $82 billion. Those figures are management forecasts, not completed sales.
Arista beats its own outlook as network demand rises
Arista’s results release put revenue at $3.66 billion, up 20.5% from the preceding quarter and above its own $3.3 billion guidance. CEO Jayshree Ullal described the 58.5% annual increase as the company’s fastest year-over-year revenue growth since its initial public offering.
Adjusted earnings were $1.20 a diluted share, above the $1.08 analyst estimate reported by Investing.com. Standard-accounting earnings were $1.22 a share, compared with 67 cents a year earlier. The adjusted and standard-accounting measures use different treatments of expenses and tax items.
Arista forecast fourth-quarter revenue of $3.9 billion to $4.0 billion, adjusted earnings of $1.26 to $1.30 a share and an adjusted operating margin of 48% to 49%.
The company builds networking equipment for AI, data-center, campus and routing environments. Its quarterly update included open Ethernet rack-scale architectures developed with partners including AMD, Arm, Broadcom, Meta, Microsoft and Qualcomm.
For investors, the two reports show demand across different layers of AI infrastructure rather than only at the chip level. The next question is how much of that demand converts into cash and lasting profits as customers expand capacity. Supermicro’s operating cash outflow and changing margins, alongside Arista’s next-quarter outlook, offer specific measures to track.
JBizNews Desk | New York
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