On April 18, the IT and computing solutions provider, Super Micro Computer Inc. (SMCI) stock had a bright late trading session with gains of over 15%. This spike in the stock came after the company declared raised guidance for the Q3 fiscal 2022.
Consequently, the stock surged up to $42.14 a share in the after-hours while the earlier session closed at $36.61 apiece.
SMCI’s Hiked Guidance
On Monday, the computer hardware maker provided preliminary financial information for the quarter that ended on March 31, 2022.
The company is now looking forward to net sales of $1.3 billion to $1.35 billion, while it previously expected sales between $1.1 and $1.2 billion. Moreover, the revised sales also beat the street consensus estimates of $1.14 billion for the quarter.
Not just sales, SMCI also raised its diluted earnings per share (non-GAAP) to $1.40-$1.50 for the third quarter of fiscal 2022. In contrast, the company previously forecasted diluted earnings of $0.70 to $0.90 a share. The street estimate for the quarter’s earnings is $0.80 per share.
Thus, the latest earnings and sales outlook beat both the company’s own guidance as well as the street consensus estimates for the quarter. According to the company, the reason for this upbeat outlook is customer demand growth on top of its total IT solution value.
Additionally, the complete Q3 fiscal 2022 financials would be released on Tuesday, May 3, 2022, after the market bell. A webcast for discussing the results will be held at 2:00 p.m. Pacific Time.
Huge Market & Bullish Rating
IT and computing solutions are the undeniable crucial elements of today’s world. With the technological advancements, today’s world is increasingly becoming dependent on computing, data storage, networking solutions, and green computing.
The global cloud computing revenue alone is expected to reach $519 billion by 2027, registering a CAGR of 23.7%.
Additionally, the global computer hardware market is also expected to grow at a CAGR of 6.6% by 2026.
SMCI has a differentiated line of server and storage systems hardware. On top of this, the company’s Total IT System portfolio delivers industry-leading edge-to-cloud solutions to growing 5G and related markets. Its edge-to-cloud systems are optimized for 5G workloads. The company has proven its solutions value and potential through the recent upbeat growth in Q3 2022.
Beating its own forecast as well as the Street estimates, SMCI hiked its outlook for the recently ended quarter. Hence, the stock rallied big in the post-market session after the news was shared.