(Reuters) -Super Micro Computer on Monday named BDO USA as its auditor and said it has submitted a plan to the Nasdaq seeking additional time to regain compliance with the listing rules, sending its shares surging 25% in extended trading.
In the compliance plan, the AI server maker said it will be able to complete its annual report for the year ended June 30 and its quarterly report ended Sept. 30, but did not give a target date.
“BDO is a highly respected accounting firm with global capabilities. This is an important next step to bring our financial statements current, an effort we are pursuing with both diligence and urgency,” CEO Charles Liang said.
Super Micro’s listing came under threat after it failed to file its annual 10-K report by the August deadline, citing a need to assess “its internal controls over financial reporting” for the delay.
The move came a day after Hindenburg Research disclosed a short position and alleged “accounting manipulation”.
The company’s shares started 2024 on a high note, buoyed by Wall Street’s optimism over the AI-driven demand for its high-performance data center servers. This was reinforced by Super Micro’s inclusion in the prestigious S&P 500 index.
But since March, its shares have been squeezed by worries over competitive pricing and production ramp-ups that have hit profit margins. The selloff accelerated after the accounting issues, pushing the shares down more than 24% this year.
On Monday, Super Micro’s shares closed up nearly 16% after a report earlier in the day said the company intends on submitting a plan with the Nasdaq.
The Nasdaq regulations provided a grace period until mid-November to submit a remediation plan to regain compliance.
If approved, this could extend the deadline to February next year. However, analysts said the timeline appeared to be squeezed after EY resigned as Super Micro’s auditor in October.
Pending the review of Super Micro’s compliance plan, its shares will remain listed on the Nasdaq.
(Reporting by Akash Sriram and Zaheer Kachwala in Bengaluru; Editing by Arun Koyyur)
Comments