Supermicro's quarter is $4 billion above its guidance at 12% margins; Micron's Taiwan workers strike Thursday
Supermicro pre-announced a September quarter about $4 billion above its own guidance and its shares jumped after hours, but at roughly 12% gross margin most of that revenue is paid onward to the component makers. Micron's Taiwan workers strike on Thursday for a share of the profit collecting at the memory base.
Richard Tang · 4 min read
Supermicro+7.79% — Supermicro, up 7.79 percent today told investors tonight that the quarter ended September 30, 2026, will land at $18.5–19.5 billion of revenue, against the $14.5–15.5 billion it had guided 1. Gross margin will come in at 12.0–12.5% rather than the planned 10.4–10.8% 1. The shares of the San Jose server builder, run by founder-chairman Charles Liang, jumped more than 10% after hours 2. The full print follows on November 3, 2026 1.
What tonight adds to a month of Supermicro legal news
What is new after our reporting on the indictment of a Supermicro co-founder and the lawsuit against its board is the number itself. A former Supermicro contractor pleaded guilty on October 8, 2026, in a scheme to divert about $2.5 billion of Nvidia+1.57% — Nvidia, up 1.57 percent today-powered servers to China 3. Tonight's update adds a fact those stories could not: by the company's account, demand for its AI platforms outran its own plan 1.
Supermicro's preliminary September quarter is its largest in three years
- Estimate
Data
| Value | Range | |
|---|---|---|
| Q4 '24 | $5.68B | — |
| Q1 '25 | $4.6B | — |
| Q2 '25 | $5.76B | — |
| Q3 '25 | $5.02B | — |
| Q4 '25 | $12.68B | — |
| Q1 '26 | $10.24B | — |
| Q2 '26 | $11.12B | — |
| Q3 '26 (preliminary) (estimate) | $19B | $18.5–19.5B |
At assembler margins, most of the surprise is paid onward
An assembler, a firm that builds servers from bought parts, keeps its gross margin and pays the rest onward. Supermicro's is about 12% 1. About $4 billion of the September quarter's revenue was not in the company's plan 1. At the pre-announced margins, that surprise keeps roughly $480 million as gross profit, and the rest goes to the companies that make the chips and memory 1.
Jabil+0.78% — Jabil, up 0.78 percent today, which builds many of the same AI racks, expects its AI revenue to reach about $22.1 billion in its fiscal 2027 5. Micron+0.48% — Micron, up 0.48 percent today shows the other side of the trade: its latest quarterly gross margin was 87% 6. The firms that turn scarce parts into working data centers are paid in volume, and the makers of the scarce parts are paid in margin.
Barclays' question is what happens when memory prices normalize
Barclays+1.43% — Barclays, up 1.43 percent today analyst Tim Long raised the sharper question on October 14, 2026, when he downgraded Dell, Hewlett Packard Enterprise and NetApp. He said Dell's rally reflects "how well the company has offset memory cost inflation by raising prices," and he expects "a meaningful deceleration in growth over the next two years and memory price normalize and potentially decline" 7. His note argued Dell's revenue boom owes more to rising memory prices than to enterprise AI demand 8.
Supermicro's quarter arrives days after that note, and it holds up the side Long credits at Dell. Gross margin widened versus the company's own guidance in a quarter of dearer components 18, which suggests pricing power rather than simple absorption of inflated parts. The path is less clean: the September estimate sits below the 17.5% of the quarter ended June 30, 2026 4. Whether Long's deceleration call is right turns on memory prices 7.
September's margin beats Supermicro's guidance while falling from the June quarter
- Gross margin
- Estimate
Data
| Gross margin | |
|---|---|
| Q3 '24 | 13.1% |
| Q4 '24 | 11.8% |
| Q1 '25 | 9.6% |
| Q2 '25 | 9.5% |
| Q3 '25 | 9.3% |
| Q4 '25 | 6.3% |
| Q1 '26 | 9.9% |
| Q2 '26 | 17.5% |
| Q3 '26 (preliminary) (estimate) | 12.25% (12.0–12.5%) |
Micron's workers are organizing for a share of the profit
The profit is collecting at the memory base, and the people who work there know it. Micron's Taoyuan union in Taiwan will strike on Thursday, October 22, 2026, backing a second union that meets Micron that day for mediation at Taichung, where the company runs its largest facility in Taiwan 96. Taiwan is where Micron makes the dynamic random-access memory (DRAM) and high-bandwidth memory (HBM) that go into AI servers 96.
The unions want Micron to tie quarterly bonuses to 15% of its operating profit, as Korean rivals Samsung and SK hynix+0.36% — SK hynix, up 0.36 percent today already do 9. Micron has offered its Taiwan staff benefits worth 35 to 68 months of pay and says the offer is separate from the dispute 9. With more than 75% of its 2027 output already committed 6, Micron's results suggest the pool has room for the bonuses being bargained over.
The November print and Thursday's mediation decide what comes next
For anyone holding these names, the watch list is short. The question is whether the 12.0–12.5% margin holds into the November 3, 2026, print 1, and whether Thursday's strike and the Taichung mediation move the memory prices Barclays expects to normalize 79. If the margin holds while the shortage lasts, Supermicro's pricing power is real; if memory prices roll over first, the deceleration Long forecasts lands on assembler revenue.
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