In the first quarter (Q1) of 2024, Super Micro Computer (NASDAQ: SMCI) proved a major challenger to Nvidia (NASDAQ: NVDA) as the year’s stock market superstar. Specifically, Supermicro equity soared 300% in Q1, while NVDA shares were up about 70% in the same time frame.
The period between March and August, however, shifted the situation, and SMCI began unraveling entirely with a damning report published in Q3 by the now-defunct activist short seller Hindenburg Research.
Still, after months of uncertainty and a collapse that eventually led Supermicro shares to $17.25 lows, the company slowly began picking up the pieces, securing a new auditor, regaining analyst – and investor – confidence, and moving to rebuild and further develop its business.
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SMCI stock gains ground in 2025 despite massive market turbulence
March 19, 2025, proved a particularly positive day for SMCI stock as it rallied 5.80% within a single session, Though the extended trading sent it 1.67% in the red and to its March 20 press time price of $39.63, it remains 30.02% in the green year-to-date (YTD).
Interestingly, the upward momentum ensured that Supermicro is one of the best-performing West-based artificial intelligence (AI) stocks of the year – for contrast, NVDA shares are down 15% in 2025, while China’s Alibaba (NYSE: BABA) soared 68.57%.
Why SMCI stock is rallying
SMCI’s latest surge owes much to the AI sector as it was driven in part by the news that the company has upgraded its platform with Nvidia’s Blackwell Ultra series while adding support for RTX PRO 6000 Server Edition GPUs.
The improvements are expected to significantly boost Supermicro’s capabilities while providing for more efficiency by cutting energy and cooling water consumption.
They have also been very timely as the AI sector is moving toward inference – reasoning capabilities, in a nutshell – which demand significantly more computing power.
Indeed, Nvidia’s Jensen Huang recently quoted the inference phase as one of the main reasons why DeepSeek’s new model will need substantially more power: reasoning AI is far more computing-intensive than non-reasoning AI.
Furthermore, DeepSeek was seen as bullish for Silicon Valley despite its reported low costs for some time, as it was seen as merely changing the use for the vast infrastructure being established in the West, not invalidating it.
Wall Street regains confidence in SMCI stock
Beyond the hardware developments, SMCI’s comeback can be attributed to a decent earnings report filed in February, greater financial compliance, and substantial analyst optimism.
As Finbold reported on March 12, there has been an increasing number of analysts willing to rate Supermicro shares as either ‘neutral’ or a ‘buy.’ At the time, Rosenblatt’s $60 price target was seen as especially bullish.
Lastly, Northland Securities proved even more bullish earlier in March when they opined that SMCI stock could rally as high as $70 in the coming 12 months.
Featured image via Shutterstock
