Data center server maker Super Micro Computer Inc. seems to be back in Wall Street’s good graces after delivering an impressive earnings beat in its fourth quarter reported today.

The company surprisingly missed expectations on revenue, but the big beat on its bottom line, combined with strong guidance for the current quarter, helped its stock gain more than 7% in extended trading.

Supermicro reported adjusted earnings of $1.70 per share, smashing Wall Street’s target of just 92 cents per share. Revenue for the period came to $11.1 billion, up 91%, but it wasn’t enough to beat the Street’s consensus estimate of $11.6 billion. Nonetheless, it also reported a big jump in profitability, ending the quarter with net income of $1.18 billion, up from $483 million in the prior quarter and $195 million in the same period one year ago.

Investors were also sold on the company’s growing order backlog. Chief Executive Charles Liang (pictured) revealed that the company booked more than $60 billion worth of new orders over the past year. “Our total AI/IT solutions strategy continues to deliver results, we added several hundred enterprise and other customers in the past year,” he told analysts.

Supermicro’s strong order pipeline illustrates the insatiable demand enterprises have for high-performance computer servers that can power artificial intelligence workloads, which many are finding increasingly difficult to source due to supply chain challenges. The momentum comes amid an unprecedented global surge in data center infrastructure spending. Cloud infrastructure providers and enterprises are racing to expand their data centers to support AI workloads, and the demand for high-density server configurations is currently outstripping available supply. Because of this, Supermicro has considerable pricing power, which has helped to boost its margins.

Indeed, the company said that its gross margin in the quarter rose to 17.6%, higher than the 15% to 17% forecast it provided last month when it announced its preliminary earnings results. Supermicro had previously forecast a range of just 8.2% to 8.4%.

The good news for Supermicro’s investors is that it sees no end to this demand. For the first quarter of fiscal 2027, it’s eying revenue of $14.5 billion to $15.5 billion, which would mean a gain of between 189% and 209% from the same period one year earlier. That range is well ahead of Wall Street’s target of $11.8 billion. For fiscal 2027 as a whole, Supermicro is targeting revenue of between $65 billion and $72 billion versus the Street’s forecast of $53 billion.

The after-hours jump in Supermicro’s share price means that its stock is now up 8% in the year to date.

Photo: Supermicro