Shares of Super Micro Computer (NASDAQ:SMCI) fell about 5% on Friday after the company cautioned that weaknesses in its controls related to financial disclosures may, if not remedied, hamper its ability to report results “in a timely and accurate manner.”
“We have identified material weaknesses in our internal control over financial reporting, which could, if not remediated, adversely affect our ability to report our financial condition and results of operations in a timely and accurate manner,” said Super Micro in a 10-K regulatory filing with the U.S. Securities and Exchange Commission.
Last year, Super Micro missed an August 2024 deadline to file its annual financial report, and its auditor Ernst & Young resigned in October. However, earlier this year, the company filed its “delinquent” financial reports to the U.S. SEC just ahead of its deadline.
“We have concluded that our internal control over financial reporting was not effective as of June 30, 2025 due to the existence of material weaknesses in such controls,” said the server and storage solutions’ provider in the 10-K filing on Thursday.
The company added that “we have also concluded that our disclosure controls and procedures were not effective as of June 30, 2025 due to material weaknesses in our internal control over financial reporting.”
Super Micro noted that while it has started remediation measures to address the identified material weaknesses, it cannot provide assurance that the efforts will be adequate to allow it to conclude that such controls will be effective in the future.
“We also cannot assure you that additional material weaknesses in our internal control over financial reporting will not arise or be identified in the future,” said the company in the filing.
Super Micro did not immediately respond to a request for comment from Seeking Alpha.