Wall Street Breakfast Podcast: Super Micro Gains On Preliminary Q2 Report

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Super Micro Computer (SMCI) offers up prelim Q2 results, $700M private placement. (00:26) Amazon (AMZN) to open first brick-and-mortar beauty, health store in Italy. (02:10) Netflix (NFLX) opens up a restaurant on the Las Vegas Strip. (02:53)

This is an abridged transcript.

Super Micro Computer (NASDAQ:SMCI) is up 6.5% premarket after the artificial intelligence server company reported preliminary second-quarter results and guidance for the coming period and offered an update into its ongoing financial investigation.

For the period ending Dec. 31, SMCI earned between $0.58 and $0.60 per share on an adjusted basis, as revenue rose 54% year-over-year to be between $5.6B and $5.7B. The company had previously expected adjusted earnings to fall within a range of $0.56 to $0.65 per share.

Looking to the next period, Super Micro expects to earn between $0.46 and $0.62 per share on an adjusted basis. Revenue is expected to fall within a range of $5B to $6B.

In addition, Super Micro said it hopes to have its 2024 annual report filed by Feb. 25, along with its quarterly reports for the September 2024 and December 2024 periods. The company had not filed the quarterly reports amid accusations of improper accounting that led to an internal review.

Super Micro also said it is cooperating with the Dept. of Justice and SEC on document requests related to the matter.

Seeking Alpha analyst Jeremy of Kumquat Research said the governance issues “appear to be having an impact on operating results.” They said, “The launch of [Nvidia’s (NVDA)] Blackwell should have provided the company with an opportunity for higher gross margins, but it appears this has not materialized, as ramping up production might have been hampered by the recent issues.”

Amazon (NASDAQ:AMZN) is trying out a new brick-and-mortar store, this time for health and beauty products in Milan, Italy.

Amazon Parafarmacia & Beauty, the company’s first physical retail store in Italy and will open on February 12. It’ll feature a wider range of beauty and personal care items, as well as over-the-counter medications and para-pharmaceutical products.

The beauty segment is among Amazon’s (AMZN) fastest-growing product categories. A recent Statista survey showed that Amazon is the leading online beauty retailer in the U.S.

Amazon’s (AMZN) prior brick-and-mortar forays included bookstores, pop-up shops, and apparel stores – all of which were shuttered due to lagging sales.

The new Netflix Bites Vegas restaurant is now open for walk-in customers at the MGM Grand Hotel & Casino on the Las Vegas Strip.

The pop-up restaurant features dishes and drinks inspired by some of Netflix’s (NASDAQ:NFLX) most popular productions.

A similar restaurant in Los Angeles in 2023 saw strong traffic and created viral buzz during its one-month run.

The Netflix Bites location at the MGM Grand is expected to stay open for a year.

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Catalyst watch:

• Notable investor events include Western Digital’s (WDC) Investor Day. The event takes place ahead of the planned separation of the company’s Flash business and will include a strategy update.

• Notable investor events also include Mama’s Creations’ (MAMA) Investor Day.

• Lockheed Martin (LMT), Rocket Lab USA (RKLB), and Archer Aviation (ACHR) are some of the notable companies due to participate in the three-day TD Cowen Aerospace and Defense Conference.

• Aureus Greenway (AGH) will begin trading after pricing its IPO.

Now let’s take a look at the markets ahead of the opening bell. Dow, S&P and Nasdaq futures are in mixed territory. Crude oil is down 1% at $72/barrel. Bitcoin is down 1.8% at $96,000.

In the world markets, the FTSE 100 is flat and the DAX is up 0.2%.

The biggest movers for the day premarket: Lyft (NASDAQ:LYFT) shares plunged nearly 11% despite posting a strong Q4 with record bookings and a double-digit rise in active riders, as investors reacted to softer-than-expected Q1 guidance.

On today’s economic calendar:

• 8:30 am Consumer Price Index

• 10:00 am Powell testifies before House Financial Services Committee

• 12:00 pm Atlanta Federal Reserve Bank President Raphael Bostic will speak on the economic outlook in a moderated conversation before the Atlanta chapter of the National Association of Corporate Directors.