Super Micro experiences a 18% decline in stock price following revenue miss announcement.

• On Wednesday, Super Micro Computer's stock price dropped after the company raised its revenue forecast but fell short of estimates in the third quarter.
• On Tuesday, the company reported revenue of $3.85 billion, which was below the $3.95 billion forecasted by analysts surveyed by LSEG. However, the adjusted earnings of $6.65 per share exceeded the $5.78 in earnings per share that analysts had predicted.
• Super Micro raised its revenue forecast for fiscal 2024 to between $14.7 billion and $15.1 billion, surpassing the predicted $14.6 billion, according to LSEG.

On Wednesday morning, the shares of the server company plummeted 18% after it raised its top-line guidance but reported third-quarter revenue that was only slightly above estimates.

On Tuesday, the company reported revenue of $3.85 billion, which was below the $3.95 billion forecasted by analysts surveyed by LSEG. However, the adjusted earnings of $6.65 per share exceeded the $5.78 in earnings per share that analysts had predicted.

Super Micro raised its revenue forecast for fiscal 2024 to between $14.7 billion and $15.1 billion, surpassing the predicted $14.6 billion, according to LSEG.

In 2023, Super Micro's stock price increased by 246% due to investor expectations that it could become a crucial supplier of servers for Nvidia, a competitor of companies such as AMD and Intel.

Despite joining the S&P 500 in March, Super Micro's shares have increased by approximately 150% this year.

Super Micro's buy rating was reiterated by Bank of America analysts, who also lowered their price target from $1,280 to $1,090. In a Wednesday investor note, the analysts stated that their "bullish thesis remains intact," citing the company's positive guidance and ability to capture demand from other chip makers beyond Nvidia, among other factors.

The analysts predict that Super Micro will maintain its focus on AI server sales and anticipate positive estimate revisions in the future.

JPMorgan analysts, who have given Super Micro a price target of $1,150 and rated its stock as overweight, commended the company's business outlook, stating that it had little to worry about in terms of demand and supply gains. However, they also raised concerns about Super Micro's willingness to cut costs on margins and its potential need for additional capital raises that could dilute earnings.

The analysts were positively surprised by the sustained industry demand momentum and the robust revenue momentum of Super Micro, which reinforced its leading position in the market.

On Tuesday, Wells Fargo analysts lowered their price target for Super Micro stock from $960 to $890 while maintaining an equal weight rating. Meanwhile, Barclays analysts kept their neutral rating but increased their price target from $961 to $1,000.

The analysts at Barclays stated that SMCI's competitive advantage is maintained through their supply chain checks.

— CNBC's Michael Bloom contributed to this report.