SMCI · Super Micro Computer, Inc.
10-K filed 2026-08-31 period 2026-06-30
59 Caution
confidence high · source filing on SEC.gov ↗
- Massive working capital requirements led to a deeply negative operating cash flow of -$6.81B, driven by an $8.88B inventory build and a $3.92B increase in accounts receivable.
- To fund its rapid growth, the company raised substantial capital, including $4.23B from Series A Mandatory Convertible Preferred Stock and expanding credit facilities, resulting in total debt of $8.72B.
- BDO USA, P.C. issued an adverse opinion on the company's internal control over financial reporting as of June 30, 2026, highlighting persistent material weaknesses.
vs. prior filing (10-Q filed 2026-05-11)
FHS 53 → 59 (+6) · Caution -> Caution
Profitability +0Balance sheet +15Cash generation +5Risk flags +15Mgmt signal -5
Filing Health Score pillars
Profitability 25%
85
Revenue grew 77.8% to $39.1B and net income more than doubled to $2.23B in FY2026, though gross margin compressed slightly to 10.8% from 11.1% in FY2025 (Consolidated Statements of Operations).
Balance sheet 20%
70
While cash increased to $7.52B, total debt rose to $8.72B, and the company experienced dilution from a 10.6% increase in common shares outstanding and the issuance of $4.23B in Series A Preferred Stock (Consolidated Balance Sheets).
Cash generation 20%
30
Operating cash flow was deeply negative at -$6.81B due to massive working capital requirements, including an $8.88B inventory build and a $3.92B increase in accounts receivable (Consolidated Statements of Cash Flows).
Risk flags 20%
45
The company received an adverse audit opinion on internal controls over financial reporting as of June 30, 2026, and faces risks from past delinquent filings and high customer concentration (Report of Independent Registered Public Accounting Firm & Risk Factors).
Mgmt signal 15%
60
Management highlights strong AI-driven demand momentum but expresses caution regarding supply chain constraints, component pricing volatility, and the heavy reliance on external credit facilities to fund growth (Risk Factors).
Key metrics (FY2026 (ended June 30, 2026))
period: FY2026 (ended June 30, 2026)
operating cash flow: -$6,809,886 thousand
total debt: $8,720,287 thousand
cash and equivalents: $7,521,474 thousand
net income: $2,230,453 thousand
shares outstanding: 656,882,499
revenue: $39,063,072 thousand
Gemma triage notes (pre-analysis, second opinion)
risk_factors
Here’s a terse bullet-point analysis of the SEC filing’s risk factors, categorized for clarity: **Notable Changes:** * **AI Dependence:** Significant reliance on the AI industry, creating volatility risks. * **Delinquent Filings:** Past SEC reporting delays increased risk of enforcement. * **Material Weaknesses:** Previously identified internal control weaknesses remain a concern. **Red Flags:** * **Going Concern:** Fluctuating operating results and potential for stock price decline. * **Customer Concentration:** Heavy reliance on a few large customers creates vulnerability. * **Control Weaknesses:** Persistent material weaknesses in internal controls. * **Litigation Risk:** Ongoing lawsuits and legal proceedings pose a significant threat. * **Financing Risk:** Difficulty securing favorable financing, potential dilution. **Overall Tone:** * **Cautious & Defensive:** The filing is heavily focused on potential risks and uncertainties, employing numerous caveats and warnings. * **Reactive:** The document largely addresses past issues (delinquent filings, material weaknesses) and highlights ongoing vulnerabilities.
Automated research summaries derived from SEC filings. Not investment advice.