Hindenburg Research goes after Super Micro
Super Micro Computer Inc. faces allegations of accounting manipulation, self-dealing, and export violations, alongside losing major clients due to reliability issues, raising concerns about governance and compliance.
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Super Micro Computer Inc., a $35 billion server manufacturer, is facing serious allegations of accounting manipulation, self-dealing, and sanctions evasion, according to a report by Hindenburg Research. The investigation revealed significant accounting irregularities, including undisclosed related party transactions and failures in export controls. Super Micro previously faced SEC charges for accounting violations, leading to a $17.5 million settlement. Despite this, the company reportedly resumed improper revenue recognition shortly after the settlement. The report highlights concerning relationships with related parties, particularly those controlled by CEO Charles Liang's brothers, which raise questions about revenue recognition and governance. Additionally, Super Micro has been implicated in potential violations of U.S. export bans, with a significant increase in exports to Russia since the Ukraine invasion. The company has also faced competition issues, losing major clients like Tesla and CoreWeave to competitors such as Dell. Former employees have criticized Super Micro's after-sales service and product reliability, describing it as a significant weakness. Overall, the report paints a picture of a company struggling with governance and compliance issues while facing increasing competition in the tech industry.
- Super Micro is accused of accounting manipulation and self-dealing involving related parties.
- The company has faced SEC charges and a settlement for prior accounting violations.
- Allegations include violations of U.S. export bans, particularly concerning sales to Russia.
- Super Micro is losing major clients to competitors due to reliability and service issues.
- Former employees report a persistent culture of malfeasance within the company.
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2 commentsHe said it was common for companies to pay extra for servers that had been burned in. But when they got them, it was obvious that they paid for nothing. The servers not only didn't boot, but they were missing parts and could never have booted.
On the other hand, I have friends who work in data centers and like their servers and rack them in large quantities.
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