Supermicro Surges as Gross Margin Outlook Rises Amid $60B Backlog

Shares of Supermicro (SMCI) jumped roughly 15% in premarket trading Wednesday, fueled by a robust update following Tuesday's market close. The AI server and data center equipment maker revealed it expects to nearly double its gross margins in upcoming quarters.

The company highlighted a staggering new order intake of more than $60 billion in the fourth quarter of fiscal 2026, pushing its backlog to an all-time high. Such volume underscores strong demand for Supermicro's customized server solutions amid the ongoing AI hardware surge.

Previously, Supermicro forecasted gross margins in the range of 8.2% to 8.4%. Now, it's aiming for 15% to 17%, citing favorable shifts in customer and product mix that should boost profitability significantly. This jump could signal a better pricing environment or improved operational efficiencies.

Supermicro's servers integrate chips from industry heavyweights like Nvidia, Intel, and AMD. The company recently teased big projects, including a new gigawatt-scale AI data center for SpaceX and XAI, highlighting its role in powering next-generation AI infrastructure.

Despite these tailwinds, SMCI's stock hasn't been immune to volatility. Its shares have dipped almost 13% year to date, dragged down by a June announcement of an equity raise aimed at funding the massive component purchases needed to fulfill $39 billion in AI server orders.

Supermicro's ability to convert its massive backlog into revenue and maintain its elevated margin outlook will be critical to watch as the AI hardware arms race heats up. The company's performance stands as a bellwether for how hardware suppliers are faring in the current environment.

Can Supermicro sustain this momentum and translate its backlog into consistent profits? That's the question investors will be parsing as fiscal year 2027 unfolds.