It’s been a rough few months for Super Micro, and the spotlight hasn’t been on earnings as much as on the serious issues surrounding its financial reporting and compliance.
Back in August, short-seller Hindenburg Research published a report accusing Super Micro of “glaring accounting red flags, undisclosed related-party transactions, sanctions and export control failures, and customer issues.” Super Micro has since countered these claims, saying the report contains false information.
The situation escalated when, a day after the Hindenburg report, Super Micro announced it would delay its annual 10-K filing for the fiscal year ending June 30. By Sept. 20, the company received a letter from Nasdaq warning that it was out of compliance with listing rules due to delayed SEC filings.
Then on Oct. 30, Ernst & Young, Super Micro’s accounting firm, resigned, stating it was “unwilling to be associated with the financial statements prepared by management.” Super Micro disagreed with the decision, according to a recent filing.
Super Micro is up against the wall with a deadline looming on November 16. By then, the company needs to either file its overdue 10-K or submit a solid plan to Nasdaq to get back in compliance with listing rules.
With earnings due out, all eyes are on whether Super Micro can regain investor confidence or if this is just the beginning of a longer battle for stability.
submitted by /u/FXgram_
[link] [comments]