As Investors Panic Over a Last Oracle Contract, Should You Buy, Sell, or Hold Super Micro Computer Stock?

The troubles for AI infrastructure company Super Micro Computer (SMCI) seem to show no signs of abating. After accounting issues led to its delisting and auditors handing in their resignations, the company found itself in murky waters again when it was accused of smuggling Nvidia (NVDA) chips to China. While a co-founder and a contractor face prosecution, there has been some dire but not unexpected fallout.

Cloud giant Oracle (ORCL) has supposedly suspended a contract with the company, which entailed Super Micro delivering Nvidia's GB300 NVL72 racks to the company. At an estimated price of $3.5 million per rack, the revenue hit is expected to be around $1.1 and $1.4 billion. For context, Super Micro's net sales for the latest quarter were at $12.7 billion, which implies a blow of 10%.