Super Micro Computer Inc at Raymond James TMT and Consumer Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Simon Leopold - Raymond James - Analyst : So I want to talk a little bit about your take on the AI demand environment and I think part of the reason I think this question's not as obvious as maybe it first appears is press reports in the last couple of months about the idea that there's an AI bubble and it's not sustainable. I'm in print, so people know I'm an AI [bulb], so I'm not going to hide that. My biases are not to be hidden, but when you encounter any kind of challenges, how do you -- how would you describe your take on the not just the current environment, but the durability?

Question: Simon Leopold - Raymond James - Analyst : -- you talking your fiscal year end (multiple speakers)--

Question: Simon Leopold - Raymond James - Analyst : And maybe double click a little bit in terms of who those customers are for Super Micro because so much of the I think headline are dominated by these hyperscalers and then we talk about terms like neo and sovereign and enterprise. Help us understand what that mix is and who those are. What are they doing?

Question: Simon Leopold - Raymond James - Analyst : Now, I guess we can accept the fact that there's going to be some lumpiness to the business because they're big projects. One of the transitions that seems to have been disruptive is going from NVIDIA's Hopper to Blackwell. Where are you through that transition and what lessons maybe did the company learn in terms of execution so that when we go through the next generation? How do you avoid that? What needs to happen?

Question: Simon Leopold - Raymond James - Analyst : Now there's another technological transition that maybe you can help explain this to an audience that might not appreciate the terminology, but you're shifting to more rack scale systems. We talk about the idea of nodes to rack scales. First explain to people what that means, and then my real question is, is that a risk? Is this a phase where it's another challenge that could have stumbling blocks?

Question: Simon Leopold - Raymond James - Analyst : And when you talk about retention or stickiness, what's the rationale? Is it essentially you're doing some customization or is there something unique or something differentiated? What creates that?

Question: Simon Leopold - Raymond James - Analyst : And the company's been growing its capacity fairly rapidly. Could you help folks understand maybe a little bit of where you've come from, what you've added, where we are today, and then where we're going. So how much more capacity do we need to add? How are we doing today?

Question: Simon Leopold - Raymond James - Analyst : But presumably we shouldn't build models assuming a 100% utilization all the time. So you've obviously given a full-year revenue forecast, but when we think about kind of the long-term business model, is there an optimized or rule of thumb of what's the appropriate utilization to think of?

Question: Simon Leopold - Raymond James - Analyst : Now, the other topic that the investors keep harping on, profits. So I guess it's great (laughter) that you can sell a lot of products, but the investors also like you to be profitable. Gross margins have naturally been under pressure in I think the whole space. I don't think it's unique to Super Micro, but I feel like it's always tomorrow, tomorrow, tomorrow. What do you see as the timeline and the outlook for improving margins?

Question: Simon Leopold - Raymond James - Analyst : Now the other aspect of I guess cost that's really been a hot topic is memory. In that, anytime you build an AI platform, you have to buy memory chips, high bandwidth memory, DRAM in particular. How have you managed through that? I just, as an aside, I think we've all been surprised watching some of the earnings reports. It hasn't been as bad as feared, but it's our nature to worry about what comes next. So with that.

Question: Simon Leopold - Raymond James - Analyst : Do you have ability to contractually pass these costs off? Can you --

Question: Simon Leopold - Raymond James - Analyst : You've got some flexibility.

Question: Simon Leopold - Raymond James - Analyst : So the other thing I think about how the company's been evolving is I always looked at it as somewhere between the white box vendors and your traditional OEMs and you've run me. You generally are a pretty efficient company, but as you're moving upmarket, moving more branded type behavior, do you see the business model, the operating model changing, either becoming more R&D heavy or more marketing heavy or you the culture is the culture and live with it.

Question: Simon Leopold - Raymond James - Analyst : So I'm going to ask a question and admit upfront it's a little bit unfair and so I'll preface it that way (multiple speakers) acknowledge it. In that, Super Micro hassle to enterprises in the past. That's the unfair part is to pretend you never did. But when I think about what the dominant branded IT companies spend on sales and marketing, it's insane. It's a lot more than you spend, so it feels like a big challenge. How does LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 08, 2025 / 6:40PM, SMCI.OQ - Super Micro Computer Inc at Raymond James TMT and Consumer Conference Super Micro become more and more competitive without the same kind of sales and marketing budget for the broader enterprise market or is that just not on the table for you?

Question: Simon Leopold - Raymond James - Analyst : Yeah, it's interesting in that when we -- at the time when we did the initiation of coverage. You were the leader among the branded products and chipping away at the white box. So I think I want to ask you about how you think about the competitive landscape and frame it in two dimensions because you are competing against the white box on one side and the branded on the other. How do you think about that? Do you fight on two fronts?

Question: Simon Leopold - Raymond James - Analyst : And then I guess we're thinking about other tools you can employ to grow into some new customers and things I wanted to check on is you don't have a financing arm, some companies do. Are there ways you can tackle that without maybe burdening your balance sheet or are there -- are you pursuing partnerships for expanding your market, working with other, I think you did a deal recently with Nokia as an example. LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 08, 2025 / 6:40PM, SMCI.OQ - Super Micro Computer Inc at Raymond James TMT and Consumer Conference

Question: Simon Leopold - Raymond James - Analyst :

Question: Simon Leopold - Raymond James - Analyst : And are there aspects of the value chain that maybe you'd want to either become somewhat more vertically integrated? Obviously, you're not going to become a GPU vendor, but technologies like cooling or the racks, it seems as if your core competency is the engineering and the manufacturing capacity, but so many companies go down this path of incorporating elements to improve margins, is that a logical part of the strategy?

Question: Simon Leopold - Raymond James - Analyst : And I want to talk a little bit about supply chain resilience, so please correct me if I get this wrong. You've got US, Taiwan, and Malaysia as your primary location.

Question: Simon Leopold - Raymond James - Analyst : Netherlands. And so if you think about your supply chain, what do you think are the risks? How do you see your ability to manage it, and what are the greatest sensitivities? What would be the choke points? What's your weak link here? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 08, 2025 / 6:40PM, SMCI.OQ - Super Micro Computer Inc at Raymond James TMT and Consumer Conference

Question: Simon Leopold - Raymond James - Analyst : So I guess maybe my constraint or sensitivity question was I feel like in the past it was just the allocation of GPUs was what we could point at. More recently, it sounds like it's high bandwidth memory is very tight. So what are the tightest parts of the supply chain? Maybe that's a different way to think about it.

Question: Simon Leopold - Raymond James - Analyst : So if we step back and think about kind of the vision of what Super Micro might look like five years from now and let's do this on the assumption that the CEOs of AMD and Broadcom and NVIDIA are all correct. Let's just accept that. In that world, where do you see Super Micro in five years?

Question: Simon Leopold - Raymond James - Analyst : So if you were encouraging an analyst who's monitoring your company. What metric or metrics to watch? Is it market share? Is it revenue growth? What should they be focused in? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 08, 2025 / 6:40PM, SMCI.OQ - Super Micro Computer Inc at Raymond James TMT and Consumer Conference

Question: Simon Leopold - Raymond James - Analyst : So I want to check with the audience, see if we've got any questions out there before we, so. The question I always like to close with is what do you think is either the most misunderstood or least appreciated aspect of the Super Micro story?

Question: Simon Leopold - Raymond James - Analyst : Well, great. Well, Michael, thank you very much for joining us today.