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Can SMCI Gain From the Projected Rise in IT Spending in 2026?
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Key Takeaways
SMCI reported 122% YoY revenue growth in fiscal Q2 2026, driven by strong data center demand.
SMCI generated $10.7B from the OEM appliance and large data center segment, about 84% of total revenues.
SMCI is expanding capacity and expects DCBBS profit share to reach double digits by the end of 2026.
Super Micro Computer (SMCI - Free Report) has been delivering consistently strong revenue momentum over the past several quarters, underscoring the surging demand for its solutions. In the second quarter of fiscal 2026, SMCI’s top line surged an impressive 122% year over year, highlighting the company’s exceptional growth trajectory.
Gartner’s latest report shows that the worldwide IT spending will grow 10.8% in 2026, reaching $6.15 trillion. Among the many markets, the data center systems are expected to grow at the highest pace, i.e., 31.7%. SMCI is one of the largest players in this space, and the growth in data center systems is expected to act as a tailwind for the company.
In the second quarter of fiscal 2026, SMCI generated $10.7 billion in revenues from the OEM appliance and large data center segment, representing approximately 84% of the top line. This was achieved on the back of SMCI’s capability to comprehensively provide compute, cooling, power infrastructure, networking and management software solutions.
SMCI in its second-quarter fiscal 2026 reported that it scaled up to an internal power capacity of 63 megawatts and is on track to scale up its rack capacity to 6,000 racks per month, including 3,000 direct liquid cooling racks by the end of fiscal 2026 as the demand for these products rises to support AI and high performance computing workloads.
SMCI is now moving toward data center building block solutions under the SMCI 4.0 phase. The DCBBS accounted for 4% of SMCI’s profit in the last quarter, and the company expects the contribution to rise to double digits by the end of 2026. Adding to these, the company is already a partner with leading AI-chip companies like NVIDIA and Advanced Micro Devices, making it one of the most promising data center systems providers in 2026.
How Competitors Fare Against SMCI
Super Micro Computer competes with Dell Technologies (DELL - Free Report) and Hewlett Packard Enterprise (HPE - Free Report) in the AI and data center market. Dell Technologies is a major supplier of servers and storage systems, with a broad customer base across enterprises and cloud providers. Its scale, established distribution and service offerings give it an edge in winning large contracts. However, Dell Technologies has not grown as quickly as SMCI in AI-specific systems; its ability to bundle hardware with services makes it a strong rival.
Hewlett Packard Enterprise is also expanding aggressively into AI and high-performance computing. Its GreenLake platform provides customers with flexible, cloud-like consumption models, which can be attractive to enterprises. Hewlett Packard Enterprise’s focus on hybrid cloud and AI workloads positions it as a direct competitor in areas where SMCI is seeking growth through its DCBBS strategy.
SMCI’s Price Performance, Valuation and Estimates
Shares of Super Micro Computer have plunged 30% in the past 12 months against the Zacks Computer – Storage Devices industry’s growth of 396.1%.
SMCI 12-Month Performance Chart
Image Source: Zacks Investment Research
From a valuation standpoint, SMCI trades at a forward price-to-sales ratio of 0.30, lower than the industry’s average of 2.69.
SMCI Forward 12-Month (P/S) Valuation Chart
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Super Micro Computer’s fiscal 2026 and 2027 earnings implies a year-over-year increase of approximately 4.85% and 37.9%, respectively. Estimates for fiscal 2026 and 2027 earnings have been revised downward in the past 60 days.
View the Zacks #1 Rank List
Image: Bigstock
Can SMCI Gain From the Projected Rise in IT Spending in 2026?
Key Takeaways
Super Micro Computer (SMCI - Free Report) has been delivering consistently strong revenue momentum over the past several quarters, underscoring the surging demand for its solutions. In the second quarter of fiscal 2026, SMCI’s top line surged an impressive 122% year over year, highlighting the company’s exceptional growth trajectory.
Gartner’s latest report shows that the worldwide IT spending will grow 10.8% in 2026, reaching $6.15 trillion. Among the many markets, the data center systems are expected to grow at the highest pace, i.e., 31.7%. SMCI is one of the largest players in this space, and the growth in data center systems is expected to act as a tailwind for the company.
In the second quarter of fiscal 2026, SMCI generated $10.7 billion in revenues from the OEM appliance and large data center segment, representing approximately 84% of the top line. This was achieved on the back of SMCI’s capability to comprehensively provide compute, cooling, power infrastructure, networking and management software solutions.
SMCI in its second-quarter fiscal 2026 reported that it scaled up to an internal power capacity of 63 megawatts and is on track to scale up its rack capacity to 6,000 racks per month, including 3,000 direct liquid cooling racks by the end of fiscal 2026 as the demand for these products rises to support AI and high performance computing workloads.
SMCI is now moving toward data center building block solutions under the SMCI 4.0 phase. The DCBBS accounted for 4% of SMCI’s profit in the last quarter, and the company expects the contribution to rise to double digits by the end of 2026. Adding to these, the company is already a partner with leading AI-chip companies like NVIDIA and Advanced Micro Devices, making it one of the most promising data center systems providers in 2026.
How Competitors Fare Against SMCI
Super Micro Computer competes with Dell Technologies (DELL - Free Report) and Hewlett Packard Enterprise (HPE - Free Report) in the AI and data center market.
Dell Technologies is a major supplier of servers and storage systems, with a broad customer base across enterprises and cloud providers. Its scale, established distribution and service offerings give it an edge in winning large contracts. However, Dell Technologies has not grown as quickly as SMCI in AI-specific systems; its ability to bundle hardware with services makes it a strong rival.
Hewlett Packard Enterprise is also expanding aggressively into AI and high-performance computing. Its GreenLake platform provides customers with flexible, cloud-like consumption models, which can be attractive to enterprises. Hewlett Packard Enterprise’s focus on hybrid cloud and AI workloads positions it as a direct competitor in areas where SMCI is seeking growth through its DCBBS strategy.
SMCI’s Price Performance, Valuation and Estimates
Shares of Super Micro Computer have plunged 30% in the past 12 months against the Zacks Computer – Storage Devices industry’s growth of 396.1%.
SMCI 12-Month Performance Chart
Image Source: Zacks Investment Research
From a valuation standpoint, SMCI trades at a forward price-to-sales ratio of 0.30, lower than the industry’s average of 2.69.
SMCI Forward 12-Month (P/S) Valuation Chart
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Super Micro Computer’s fiscal 2026 and 2027 earnings implies a year-over-year increase of approximately 4.85% and 37.9%, respectively. Estimates for fiscal 2026 and 2027 earnings have been revised downward in the past 60 days.
Image Source: Zacks Investment Research
Super Micro Computer currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.