Supermicro Computer (NASDAQ:SMCI) shares surged on Wednesday, 22 July 2026, after the AI-server and data-centre systems company released a much stronger gross-margin forecast and disclosed more than US$60 billion in new quarterly orders.
SMCI stock closed 19.84% higher at US$30.56. The rally appears to have reflected the sharp improvement in expected profitability and the company’s record backlog, even though its revenue outlook remained near the lower end of guidance.
Gross-Margin Outlook Jumps Sharply
Supermicro Computer expects both GAAP and non-GAAP gross margins of 15% to 17% for its fiscal fourth quarter, which ended on 30 June 2026. That is far above its previous guidance of 8.2% to 8.4%.
Management said the improvement mainly came from a more favourable mix of customers and products.
Gross margin is the percentage of sales left after paying the direct costs of producing and delivering products. A higher margin means Supermicro may keep more from each dollar of revenue before operating expenses, interest and taxes are counted.
This was the most important part of the update. Investors had been concerned that competition, expensive components and large customer deals were placing pressure on Supermicro’s profitability. The new forecast suggests those pressures eased significantly during the quarter.
New Orders Exceed US$60 Billion
Supermicro Computer said it received more than US$60 billion in new orders during the fiscal fourth quarter. Its backlog also reached a record level at the end of fiscal 2026, with the company expecting those orders to be delivered over future quarters.
The figures point to strong demand for Supermicro’s systems, including its AI, cloud, storage and data-centre infrastructure products.
However, investors should not treat the entire US$60 billion as guaranteed revenue. Supermicro warned that some orders may not be firm commitments and could be delayed or cancelled. The company must still build and deliver the systems before the orders can be recognised as revenue.
Revenue Outlook Remains a Weak Point
The update was not completely positive. Supermicro expects fourth-quarter revenue to be near the lower end of its previous guidance range of US$11 billion to US$12.5 billion.
Normally, a softer revenue outlook could place pressure on a stock. In this case, the market appeared to focus more heavily on margins because stronger profitability can have a large effect on earnings, even when sales come in below the middle of the forecast range.
The figures are also preliminary and unaudited. Supermicro said its final results could change as it completes its financial closing process.
What Should SMCI Investors Watch Next?
Supermicro Computer is scheduled to report its complete fourth-quarter and fiscal-year results on 11 August 2026.
Investors will want to see whether the final gross margin stays within the new 15% to 17% range and how quickly the company can convert its record backlog into revenue and cash flow.
They should also watch whether the margin improvement can continue. A favourable customer and product mix can support one strong quarter, but profitability could weaken if component costs rise, competition increases or major customers negotiate lower prices.
The 20% rally reflects a major improvement in market expectations. Supermicro must now prove that its stronger margins and huge order pipeline can produce dependable earnings over more than one quarter.
