Super Micro Computer Stock Falls After Hindenburg Research Accuses Firm of “Accounting Manipulation”

The renowned short-seller Hindenburg Research has set its sights on Super Micro Computer, accusing the tech firm of “accounting manipulation” in a scathing report that sent the company’s stock tumbling on Tuesday. Despite the stock falling more than 5%, Super Micro shares are still up 89% for the year.

Hindenburg’s three-month investigation into Super Micro revealed alarming red flags, including ongoing bookkeeping issues and undisclosed related party transactions. The report also highlighted concerns about the company’s high sales quotas, which allegedly led to the shipment of defective products to meet targets.

Furthermore, Hindenburg pointed out that Super Micro’s business relationships appeared to be “oddly circular,” with some partners primarily doing business with the company. The report also raised questions about the company’s compliance with sanctions, noting an increase in exports to Russia after the invasion of Ukraine.

In response to the report, Super Micro has not commented on the allegations. The company’s stock has experienced significant volatility in recent months, with a 20% selloff following a missed earnings estimate in its last quarterly report.

Despite the challenges facing Super Micro, Hindenburg remains critical of the company, describing it as a “serial recidivist” with significant accounting, governance, and compliance issues. The research firm believes that Super Micro’s inferior product and service are being eroded by more credible competition.

As the story continues to unfold, investors and industry experts will be closely watching how Super Micro responds to these allegations and navigates the fallout from Hindenburg’s report.