Shares of Super Micro Computer (SMCI) experienced a decline on Tuesday following the release of a report by short-seller Hindenburg Research, which accused the company of “accounting manipulation, sibling self-dealing, and sanctions evasion.” The report, which alleges undisclosed related-party transactions and a failure to adhere to export controls, has caused significant concern among investors. In premarket trading, the company’s stock fell sharply, recently showing a decline of nearly 3%.
Hindenburg Research’s report, based on a three-month investigation that included interviews with former senior employees, points to major accounting irregularities and non-compliance issues. The company has yet to respond to these allegations.
Super Micro Computer, a key player in server technology and hardware for data centers, has been significantly impacted by the AI boom. As a partner of Nvidia (NVDA), Super Micro has benefited from the surge in demand for AI-related technology, including hardware used by notable companies like Elon Musk’s xAI.
Despite a remarkable increase in its stock price this year, which has nearly doubled in 2024, Super Micro’s shares have more than halved since their peak in March. The company’s recent fiscal fourth-quarter earnings report fell short of analysts’ expectations, and it also announced a 10-for-1 stock split earlier this month.
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