Super Micro Computer, a leading AI server maker, has announced it will be selling 2 million shares, potentially raising around $2 billion. This news caused the company’s stock to drop by 11%. Despite the significant increase in the company’s shares since January, this move to sell equity is seen as a lucrative option to secure additional funds for Super Micro.
The rapid development of AI-optimized servers and proprietary liquid cooling technology has established Super Micro as a key data center supplier. The recent surge in the company’s market value even led to its inclusion in the S&P 500 index. However, investors are cautioned against buying shares after the recent rally, as there are concerns that Super Micro may struggle to meet the heightened expectations set by its impressive performance.
Following the announcement of the share sale, the company stands to raise approximately $1.8 billion. This capital is intended for various purposes such as purchasing inventory, expanding manufacturing capacity, increasing research and development investments, and other working capital needs. With the company’s outstanding shares set to increase after the offering, the underwriter, Goldman Sachs, has the option to purchase up to 300,000 additional shares within the next 30 days.