Server solutions provider Super Micro (NASDAQ: SMCI) reported calendar Q3 2026 (fiscal Q1 2027) results topping the market’s revenue expectations, with revenue up 298% year on year to $19.95 billion. In addition, next quarter’s revenue guidance ($20.5 billion at the midpoint) was surprisingly strong and 16.3% above analysts’ consensus estimates. Its non-GAAP profit of $1.81 per share was 46.6% above analysts’ consensus estimates.
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Super Micro (SMCI) Q3 CY2026 highlights:
- Revenue $19.95 billion vs S&P analysts’ consensus estimates of $16.81 billion (298% year-on-year growth, 18.6% beat)
- Adjusted EPS $1.81 vs S&P analysts’ consensus estimates of $1.23 (46.6% beat)
- Adjusted EBITDA $2.23 billion vs analysts’ consensus estimates of $1.55 billion (11.2% margin, 43.9% beat)
- Revenue guidance The company lifted its revenue guidance for the full year to $77 billion at the midpoint from $68.5 billion, a 12.4% increase
- Adjusted EPS guidance $1.78 at the midpoint for Q4 CY2026, above analysts’ consensus estimates of $1.14
- Operating margin 10.4%, up from 3.6% in the same quarter last year
- Free cash flow -$475.6 million compared to -$949.8 million in the same quarter last year
- Market capitalization $20 billion
“Supermicro’s transformation into a Total AI and IT Datacenter Solution provider continues to accelerate, delivering record revenue of $19.9 billion for the first quarter fiscal 2027,” said Charles Liang, Founder, President and CEO of Supermicro. “DCBBS is driving significant value for our customers—from gigawatt-scale datacenters down to single-container PODs—which, including our expanding software, proactive service, and networking solutions, is enhancing profitability and long-term shareholder value. Through key enterprise partnerships and expanding global production capacity, we are making AI infrastructure faster to deploy, superior up-time and more cost-effective for our customer base.”
Revenue growth
Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but many enduring ones grow for years.
With $53.99 billion in revenue over the past 12 months, Super Micro is a large company in the business services sector and benefits from economies of scale, giving it an edge in distribution. This also gives it more leverage on its fixed costs than smaller competitors and the flexibility to offer lower prices.
Super Micro grew its revenue at a strong 69.8% compounded annual growth rate over the last five years. This shows Super Micro’s demand was higher than that of many business services companies.
Long-term growth matters most, but within business services, a half-decade historical view may miss recent innovations or disruptive industry trends. Super Micro’s annualized revenue growth of 69.4% over the last two years aligns with its five-year trend, suggesting its demand was predictably strong. 
This quarter, Super Micro reported year-on-year revenue growth of 298%, and its $19.95 billion of revenue beat Wall Street’s consensus estimates by 18.6%. Management is guiding for a 61.6% year-on-year increase in revenue next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 38.6% over the next 12 months, according to S&P, a deceleration versus the last two years. Still, this projection is notable given its scale and indicates the market is forecasting success for its products and services.
Adjusted operating margin
Super Micro’s adjusted operating margin has risen over the last 12 months and averaged 8.9% over the last five years. Although its profitability is still mediocre, its strong revenue growth is giving it operating leverage as it scales. This could lead to higher long-term profits if it can keep expanding.
Looking at the trend in its profitability, Super Micro’s adjusted operating margin might have fluctuated slightly but has generally stayed the same over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability.
In Q3, Super Micro generated an adjusted operating margin of 10.9%, up 5.4 percentage points year on year. This increase was a positive development and shows it was more efficient.
Earnings per share
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth. For example, a company could inflate its revenue through excessive spending on advertising and promotions.
Super Micro’s EPS grew at an 82.1% compounded annual growth rate over the last five years, higher than its 69.8% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
As with revenue, examining EPS over a more recent period can provide insight into an emerging theme or development for the business.
For Super Micro, its two-year annual EPS growth of 39.5% was lower than its five-year trend. Growth remained good despite the slowdown.
In Q3, Super Micro reported adjusted EPS of $1.81, up from $0.35 in the same quarter last year. This comfortably beat analysts’ consensus estimates, a positive result for shareholders. Over the next 12 months, Wall Street expects Super Micro’s full-year EPS to stay about the same, moving from $5.04 to $5.02, according to S&P.
Key takeaways from Super Micro’s Q3 results
Super Micro’s EPS beat and next-quarter earnings outlook were key positives this quarter. EPS topped analysts’ consensus estimates, and guidance for next quarter cleared Wall Street’s consensus by a wide margin. Shares surged 7.5% to $33.80 immediately after the results.
Super Micro had a solid quarter, but the investment case depends on more than the latest results. What happened in the latest quarter matters, but not as much as longer-term business quality and valuation when deciding whether to invest in this stock. For more on these factors, read our full research report here (it’s free).
