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Super Micro Computer (NASDAQ: SMCI), a retailer of high-performance servers and liquid-cooled AI racks, set the proverbial tongues wagging back in August when it delayed the disclosure of its requisite annual report just a day after a high-profile attack from the prolific short-seller Hindenburg Research. Now, after exhausting a statutory facility that allows for a 15-day extension, the company has to file its delayed annual report for its FY 2024 by today.
For the benefit of those who might not be aware, Hindenburg Research leveled three primary allegations against Super Micro Computer:
- SMCI sales team allegedly stuffs its distribution channel to the proverbial gills by pushing products to distributors based on artificially inflated demand forecasts. It also reportedly implements partial shipments to inflate the total shipment count, all in a bid to meet specific sales targets.
- After the SEC charged Super Micro Computer for "widespread accounting violations" in 2020, resulting in a $17.5 million settlement, the company re-hired top executives responsible for those violations within a three-month period. This then resulted in another lawsuit that was filed in April 2024, asserting that SMCI restarted its improper revenue recognition practices just three months after reaching a settlement with the SEC.
- SMCI has paid nearly a billion dollars over the past three years to non-arm's-length suppliers such as Ablecom and Compuware.
Shortly after Hindenburg published its hard-hitting report, Super Micro Computer announced that "it will not timely file its Annual Report on Form 10-K for the fiscal year ended June 30, 2024 ..."
The company noted that "additional time" was needed "to complete its assessment of the design and operating effectiveness of its internal controls over financial reporting as of June 30, 2024."
Aug 30 last filing date. 15 calendar day extension. It was the 14th. Saturday. Allowed to file on next working day.
This is X. It doesn't matter who you trust. On legal matters ask your legal counsel. I am just going by the rule. Who knows what else the SEC or NASDAQ may allow?
— Orca Fin (@theOrcaFin) September 16, 2024
This brings us to the crux of the matter. Super Micro Computer's fiscal year ended on the 30th of June, 2024. As such, it was required to file an annual report by the 30th of August. But, as mentioned earlier, the company chose to avail a statutory facility that allows for a 15-day extension in this deadline, presumably to review its internal control mechanisms. Even so, that facility expires today, which means SMCI has to publish its annual report on a Form 10-K with the SEC within the next few hours or face a probable fine from the apex financial regulator.
Of course, throughout this review period, Super Micro Computer has continued to maintain that it does not expect this ongoing exercise to result in "any material changes" in its fourth quarter or fiscal year 2024 financial results.
So, why does all of this brouhaha matter? Well, Super Micro Computer is NVIDIA's third-largest customer and carries the heft to rock the entire narrative around AI demand. We will update this post with pertinent details once SMCI's 10-K filing drops.
Update: No Filing From Super Micro Computer So Far
Super Micro Computer $SMCI failed to file their 10-k report today. https://t.co/7P110a9VVO
— Financelot (@FinanceLancelot) September 16, 2024
Super Micro Computer has so far failed to file its requisite annual report.
For the benefit of those who might not be aware, here are the SEC's requirements on the filing deadlines for the Form 10-K.
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