Super Micro Computer stock price remains in a bear market this year as concerns about the AI industry remains. SMCI was trading at $42 on Friday, down by about 37% from its highest point this year and 65% from its highest point in 2024. So, what next for the Supermicro share price this year after forming a megaphone pattern?
Supermicro growth is continuing
Super Micro Computer, a popular technology company, is doing well as demand for artificial intelligence (AI) servers remain.
Its top products include the likes of rackmount, blade, and tower servers that are built for AI, high-performance computing, and cloud services. These servers are usually optimized for chips made by company like AMD and NVIDIA.
Supermicro is also a big player in industries like storage systems, workstations, and server management solutions.
The soaring demand for AI solutions has pushed its revenue substantially in the past few years. Its annual revenue rose from over $3.3 billion in 2020 to $15 billion last year. This growth is expected to continue growing as many large companies are expected to spend billions of dollars in the next few years.
The challenge, however, is coming from China where companies are building advanced AI models using local solutions. A good example of this is DeepSeek, whose technology has disrupted the AI industry. Ant Financial, a company owned by Alibaba also launched new AI models this week.
The most recent preliminary quarterly results show that Super Micro Computer’s business continued growing in the fourth quarter. These results showed that its net sales for the second fiscal quarter will be between $5.6 billion and $5.7 billion, representing a 54% annual growth rate.
Super Micro Computer anticipates that the gross margin will be 11.9%, while its EPS will be about $0.60. In a note, Charles Liang, the founder, said:
“With our leading direct-liquid cooling (DLC) technology and over 30% of new data centers expected to adopt it in the next 12 months, Supermicro is well positioned to grow AI infrastructure designs wins based on NVIDIA Blackwell and more.”
JPMorgan analysts upgrade SMCI
The most recent catalyst for the SMCI stock price was an upgrade from analysts at JPMorgan, who lifted its target from $35 to $45. The analyst cited the company’s recent filing of its annual report, which helped to prevent a delisting. This filing also reduced the uncertainty that was surrounding its operations.
JPMorgan anticipates that Supermicro’s annual revenue will be $39 billion, a big increase from the previous $34 billion. It attributed this growth forecast to the ramp-up of NVIDIA’s Blackwell chips.
JPMorgan’s 2026 revenue forecast is higher than what other analysts anticipate. The average 2026 revenue guidance among Wall Street analysts is $33.60 billion, with its earnings per share expected to be $3.8, higher than the $2.6 it made a year earlier.
The main risk that the Super Micro Computer stock price faces is the potential AI bubble burst, which will affect most companies in the industry.
Super Micro Computer stock price analysis
SMCI stock price chart | Source: TradingView
The daily chart shows that the SMCI share price has been in a slow upward trend in the past few months. It has soared from the December low of $16.45 in December to the current $42.
The stock has remained above the ascending trendline that connects the lowest swing since November. It has moved to the 23.6% Fibonacci Retracement point.
Supermicro stock price has also formed a broadening wedge pattern, a popular bullish sign. This pattern is also known as a broadening wedge, is one of the most bullish signs in the market. Therefore, the stock will likely continue rising as bulls target the next key support point at $70, the 50% retracement point, up by 65% from the current level.
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