The supermicrocomputer is faltering amid a smuggling investigation against a member of its board of directors, which could benefit AI server competitors, according to Wall Street. According to Wall Street, Supermicro’s stock price is heading for its worst one-day decline since 2024 following reports that the company’s co-founders, managers and contractors have been indicted by the U.S. Attorney’s Office for the Southern District of New York on charges of smuggling Nvidia chips to China. The company itself is not named as a defendant. SMCI was last down more than 25%, and shares of chipmaker Nvidia were down about 1%. But analysts say Super Micro’s setback is an opportunity for Dell Technologies, another system builder in the AI ecosystem whose stock rose 4.5% on Friday. “What’s bad for SMCI is good for DELL only in terms of market share change,” Wells Fargo’s trading desk said in a note Friday morning. Wedbush analyst Matt Bryson said Dell is most likely to gain business from Supermicro as a leading replacement for similar AI servers. DELL YTD Mountain Dell, YTD “If SMCI’s operations are disrupted, Dell would likely be the most direct beneficiary, as it has emerged as a key supplier of AI servers/equipment to large non-hyperscale AI customers (neoclouds, sovereign entities, model builders).” The smuggling incident is the latest in a series of misfortunes for Supermicro, including a change in management and an accounting fiasco less than two years ago. And this could be Dell’s “biggest windfall ever,” said Melius Research’s Ben Reitzes. “With this China headline, another dark cloud looms over Supermicro, which should disproportionately help Dell sell these solutions,” he said. “Among the U.S. AI server resellers, Dell had the best relationship with Nvidia before this headline, and it’s going to get even better going forward.” Jeffries on Friday highlighted Dell’s strength in the backdrop of the smuggling scandal, and Mizuho’s Jordan Klein said, “If the market share changes, Dell will be the clear winner.” Bryson said other equipment makers looking to grow their AI businesses could also benefit from the smuggling scandal, highlighting Cisco and Hewlett-Packard Enterprise. He also noted that design manufacturers like Pegatron that want to expand their customer base could benefit. —CNBC’s Michael Bloom contributed reporting.
