Super Micro Computer, Inc. (NASDAQ: SMCI) shares surged more than 6% in after-hours trading on Tuesday after the AI infrastructure provider reported fiscal fourth-quarter earnings that significantly exceeded Wall Street expectations and issued a stronger-than-expected outlook for fiscal 2027. The stock climbed approximately 6.7% following the release of the results.

The San Jose-based company, a leading manufacturer of high-performance and high-efficiency server technology, has been a key beneficiary of the generative AI buildout, supplying rack-scale GPU-optimized systems to hyperscalers, enterprises, and cloud providers racing to expand compute capacity. Chief Executive Officer Charles Liang has positioned Supermicro as a faster, more customizable alternative to larger rivals such as Dell Technologies and Hewlett Packard Enterprise, leveraging close technical collaboration with Nvidia and other silicon partners.

The company reported adjusted earnings of $1.70 per share, well above the 92 cents analysts had expected. Net income reached $1.18 billion, compared with $195 million in the same quarter a year earlier. Diluted GAAP earnings rose to $1.62 per share from $0.31 in the prior-year period.

Revenue nearly doubled year over year, reaching $11.1 billion from $5.8 billion, though it fell short of the approximately $11.6 billion that Wall Street had anticipated. The revenue miss, however, was overshadowed by a dramatic improvement in profitability, as pricing pressures and supply chain costs that had compressed margins in prior quarters eased considerably.

Profitability metrics improved markedly. Gross margin expanded to 17.5% from 9.5% a year earlier, while adjusted gross margin reached 17.6%. Adjusted EBITDA climbed to $1.67 billion, up from $332 million in the comparable quarter last year. The margin recovery is notable given that Supermicro operates in a category where aggressive pricing has historically squeezed hardware vendors, and it signals the company's ability to capture value from higher-margin liquid-cooled and full rack-scale AI platforms.

Liang said Supermicro added several hundred enterprise and other customers over the past year, generated more than $60 billion in new orders, and entered fiscal 2027 with a record backlog. The order book underscores the depth of AI infrastructure demand, which shows little sign of abating as major cloud providers and enterprises continue committing tens of billions of dollars to data center capacity.

For the first quarter of fiscal 2027, the company guided revenue between $14.5 billion and $15.5 billion, substantially above the roughly $11.8 billion analysts had projected. Adjusted earnings per share are expected to range from $1.01 to $1.10, compared with a Wall Street estimate of approximately $0.72.

For the full fiscal year 2027, Supermicro projected revenue between $65 billion and $72 billion, well above the approximately $53 billion analysts had forecast. The guidance reflects management's confidence that GPU supply constraints, which had limited shipments throughout much of fiscal 2026, are easing and that production capacity can scale to meet demand.

Full-year fiscal 2026 revenue reached $39.1 billion, up from $22 billion in fiscal 2025, while net income more than doubled to $2.2 billion from $1 billion.