As reported in a Form 8-K filing, Super Micro Computer (SMCI, Financials) terminated its loan arrangements with Bank of America (BAC, Financials) and Cathay Bank after completely fulfilling the obligations.
When the repayments were paid on November 20, the company revoked all agreements including all additions and modifications.
Mostly in reaction to accounting problems, Super Micro’s shares dropped 33.5% over the last month. However, a new agreement with Nvidia (NVDA, Financials) has given optimism as the company wants to benefit from the need for artificial intelligence infrastructure. Super Micro’s liquid-cooled SuperClusters for artificial intelligence data centers have helped to support its position in the competitive AI hardware space.
Hindenburg Research said in August that Super Micro’s reports included errors and that public sales of its products were not disclosed. This, they said, resulted in a late annual report for the business and notable stock price decline. The U.S. Department of Justice started a preliminary investigation on business financial practices since then.
Investors concerned with internal control and governance drove Ernst & Young to leave Super Micro in October 2024. Notwithstanding these challenges, the company’s alliances with Nvidia and Fujitsu to develop energy-efficient generative AI systems suggest that it is attempting to turn its attention back to fresh ideas.
This article first appeared on GuruFocus.
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