Super Micro Computer (SMCI) Risk Factor Changes

We do not anticipate that we will pay any cash dividends in the foreseeable future, except for the 7.00% dividend on our Mandatory Convertible Preferred Stock.

We do not expect to pay any cash dividends in the foreseeable future, except for the 7.00% dividend on our Mandatory Convertible Preferred Stock.

The conversion of some or all of our shares of Mandatory Convertible Preferred Stock or Depositary Shares, the payment of dividends on our Mandatory Convertible Preferred Stock in the form of common stock or the conve…

Provisions in our 2029 Convertible Notes Indenture, the 2028 Convertible Notes Indenture, and the 2030 Convertible Notes Indenture, the conversion of our Mandatory Convertible Preferred Stock or Depositary Shares, or…

Additionally, we plan to continue making significant investments to support our business growth and may require additional funds to address business challenges.

As of June 30, 2026, we had approximately $8.7 billion of consolidated indebtedness, including $2.0 billion of outstanding borrowings under our Revolving Credit Facility with JP Morgan, $1,763.5 million outstanding bo…

As of July 31, 2026, our executive officers and directors together beneficially owned 12.5% of our common stock.

The concentration of our capital stock ownership may limit your ability to influence corporate matters.

Our certificate of incorporation and bylaws contain provisions that could delay or prevent a change of control of our company.

Provisions of our certificate of incorporation and bylaws and Delaware law and provisions in our governing documents could delay or prevent a change of control of our company.

Because our products and services may store, process and use data, some of which contains personal information, we are subject to complex and evolving domestic and international laws and regulations regarding privacy,…

Although we attempt to ensure that we, our customers, suppliers, resellers, and partners comply with the applicable import, export, and sanctions laws, we cannot guarantee full compliance by all.

Import and export controls could disrupt our supply chain and distribution channels, negatively impacting our ability to serve demand, including in markets outside China.

Such restrictions could include additional unilateral or multilateral import and export controls on certain products or technology, including but not limited to AI technologies and high-performance computing.

We have business relationships with companies in China, in Eastern Europe, and elsewhere who have been, or may in the future be, added to a restricted party list.

If we fail to meet our contractual commitments or otherwise fail to comply with our contractual obligations, then we could be subject to breach of contract or other claims.

We previously 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 i…

We expect to continue to face many of the risks and challenges related to previously being delinquent in our SEC reporting obligations, including the following:

We market and sell our systems and subsystems and accessories both inside and outside the United States.

Our employees, contractors, consultants, service providers or other members of our workforce have used and may continue to use internal or third-party AI tools and other machine learning technologies, including public…

In addition, most of our competitors have longer operating histories, significantly greater resources, greater name recognition, or deeper market penetration.

Harm to our reputation has in the past, and may in the future, arise from many other sources, including employee misconduct, such as in connection with the alleged conduct described in the Indictment involving individ…

Negative publicity about us or our products, even if inaccurate or untrue, could adversely affect our reputation and confidence in our products, which could harm our business and operating results.

In October 2023, Ablecom and Compuware acquired an approximate 30% interest in Leadtek Research Inc.

In addition, a sibling of Yih-Shyan (Wally) Liaw, former Senior Vice President, Business Development and director on our Board, owns approximately 11.7% of Ablecom’s capital stock and 8.7% of Compuware’s capital stock.

We use Ablecom, a related party, for contract design and manufacturing coordination support and warehousing, and Compuware, also a related party and an affiliate of Ablecom, for distribution, contract manufacturing an…

To remain competitive and successfully execute our business strategy, we must attract, retain, and motivate our executives and key employees, as well as recruit and develop exceptional and diverse talent.

Despite our implementation of security measures, our systems and those of our third-party service providers are vulnerable to damage from these or other types of attacks, errors or acts of omissions.

Like other companies, we are subject to ongoing attempts by malicious actors, including through hacking, malware, ransomware, denial-of-service attacks, social engineering, exploitation of internet-connected devices,…

We had net income of $2,230.5 million, $1,048.9 million, and $1,152.7 million in fiscal years 2026, 2025, and 2024, respectively.

We may be unable to secure additional financing on favorable terms, or at all, which in turn could impair the rate of our growth, and any financing that we do obtain may dilute our stockholders, restrict our growth, o…

Moreover, customers may hesitate to purchase, or not continue to purchase, our products due to ongoing reputational harm, negative publicity or other concerns related to our previously late filings of our Annual Repor…

•We do not expect to pay any cash dividends in the foreseeable future, except for the 7.00% dividend on our Mandatory Convertible Preferred Stock.

•Provisions in our 2029 Convertible Notes Indenture, the 2028 Convertible Notes Indenture, and the 2030 Convertible Notes Indenture, the conversion of our Mandatory Convertible Preferred Stock or Depositary Shares, or…

•Provisions of our certificate of incorporation and bylaws and Delaware law and provisions in our governing documents could delay or prevent a change of control of our company;

•Because our products and services may store, process and use data, some of which contains personal information, we are subject to complex and evolving domestic and international laws and regulations regarding privacy…

•We previously 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…

•We may be unable to secure additional financing on favorable terms, or at all, which in turn could impair the rate of our growth, and any financing that we do obtain may dilute our stockholders, restrict our growth,…

Our business involves significant risks, some of which are described below.

Many governments, regulators, investors, employees, customers and other stakeholders are increasingly focused on environmental, social and governance considerations relating to businesses, including climate change and…

Expectations and evolving laws and regulations relating to environmental, social and governance considerations expose us to potential liabilities, reputational harm and other unforeseen adverse effects on our business.

Our ability to create energy saving products will be a part of climate change mitigation, and we believe it is one of the keys to our business success.

Our products may not be viewed as supporting climate change mitigation in the IT sector.

We derive significant tax benefits from non‑U.S.

Our future effective income tax rates could be affected by changes in the relative mix of our operations, our relative income among different geographic regions and domestic and foreign income tax laws, which could af…

Our operations are impacted by complex laws, rules and regulations related to import and export controls to which our business is subject, and rapid changes in such laws, rules, and regulations as well as political an…

In October 2018, our Chief Executive Officer, Charles Liang, personally borrowed approximately $12.9 million from Chien-Tsun Chang, the spouse of Steve Liang.

Any failure, disruption or security breach or incident of or impacting our information technology infrastructure or information management systems could have an adverse impact on our business and operations.

These and other geopolitical tensions, political or economic uncertainty can disrupt supply chains and increase the cost of our and our partners’ products, and have a negative impact on consumer confidence, which coul…

While recently moderating, inflation in the U.S.

Our business depends on the overall demand for accelerated compute platforms.

Global events may present challenges and risks to us.

Our business is subject to risks generally associated with doing business abroad, such as U.S.

Changes in U.S.

We have been and could continue to be the subject of negative publicity focused on the matters underlying the circumstances discussed in Item 9.

Matters relating to or arising from the circumstances discussed in Item 9.

We have devoted and expect to continue to devote substantial internal and external resources towards remediation efforts relating to the circumstances discussed in Item 9.

We have incurred and expect to continue to incur significant expenses related to the circumstances discussed in Item 9.

Due to the circumstances discussed in Item 9.

We face risks related to previously being delinquent in our SEC reporting obligations.

Risks Related to Previous Delinquent SEC Reporting Obligations

•Expectations and evolving laws and regulations relating to environmental, social and governance considerations expose us to potential liabilities, reputational harm and other unforeseen adverse effects on our business.

•Our products may not be viewed as supporting climate change mitigation in the IT sector;

•Our future effective income tax rates could be affected by changes in the relative mix of our operations, our relative income among different geographic regions, and domestic and foreign income tax laws, which could…

•Our operations are impacted by complex laws, rules and regulations related to export control to which our business is subject, and rapid changes in such laws, rules, and regulations as well as political and other act…

•Changes in U.S.

•Matters relating to or arising from the circumstances discussed in Item 9.

•We have incurred and expect to continue to incur significant expenses related to the circumstances discussed in Item 9.

•We face risks related to previously being delinquent in our SEC reporting obligations;

Risks Related to Previously being Delinquent in SEC Reporting Obligations

In the U.S., the One Big Beautiful Bill Act (“OBBBA”), enacted on July 4, 2025, permanently extends certain Tax Cuts and Jobs Act provisions, modifies the international tax framework, and restores favorable business t…

We derive significant tax benefits from non‑U.S.

Our operating results may be adversely impacted by additional tax liabilities, higher than expected tax rates, changes in tax laws, and other tax-related factors.

The market price of our common stock could become more volatile and could be depressed by: (1) investors’ anticipation of the potential resale in the market of a substantial number of additional shares of common stock…

Import and export controls targeting products containing GPUs and semiconductors associated with AI, which have been imposed and are increasingly likely to be further tightened, would further restrict our ability to e…

For example, we have received multiple subpoenas from the OEE of BIS (the “BIS Inquiries”), including at least two subpoenas and one informal request relating to a certain customer implicated by the facts and circumst…

We are subject to U.S.

We are subject to complex laws, rules, regulations, and political and other actions, including restrictions on the export of our products, which may adversely impact our business.

In connection with the indictment of three former associates, the Company completed an independent investigation, which was jointly led by our Lead Independent Director and the Chair of the Board’s Audit Committee.

The Company also received a grand jury subpoena from the U.S.

For example, the Company received a subpoena from the SEC requesting the production of documents relating to certain customers, including one customer that is the subject of the allegations in the Indictment, and the…

In addition, the circumstances underlying the legal proceeding related matters discussed continue to create the risk of additional litigation and claims by investors and examinations, investigations, proceedings and o…

We have been, are currently, and may in the future be subject to various lawsuits, stockholder derivative actions, class action lawsuits, individual or mass arbitration proceedings, and other types of legal proceeding…

•We may be subject to increased audit fees and additional compliance costs, heightened regulatory scrutiny and potential operational disruptions as management and personnel incur significant time and resources to reme…

We were delinquent in certain SEC reporting obligations in prior fiscal years, which may increase the risk of SEC enforcement actions, damage investor confidence, and require significant resources to correct.

Stakeholder groups may find us insufficiently responsive to the implications of climate change, and therefore we may face legal action or reputational harm.

Our business and those of our suppliers and customers are subject to sustainability-related laws, regulations and lawsuits.

Climate change may have an increasingly adverse impact on our business and on our customers, partners and vendors.

Climate change may have a long-term impact on our business.

Furthermore, laws and regulations focused on the use and provision of AI or machine learning technologies may impose certain obligations on us and could result in monetary penalties or other regulatory actions.

AI or machine learning technologies usage by our service providers in their business activities, whether or not known to us, could also expose us to risks.

On March 19, 2026, the U.S.

•Our operating results may be adversely impacted by additional tax liabilities, higher than expected tax rates, changes in tax laws, and other tax-related factors;

•We are subject to complex laws, rules, regulations, and political and other actions, including restrictions on the export of our products, which may adversely impact our business;

•We were delinquent in certain SEC reporting obligations in prior fiscal years, which may increase the risk of SEC enforcement actions, damage investor confidence, and require significant resources to correct.

•Climate change may have a long-term impact on our business;