Super Micro Computers (SMCI, Financials), a partner of Nvidia (NVDA, Financials), is notable for its decline following a change in auditors and removal from the Nasdaq 100 Index. Shares fell 11.8% on last look in pre-market trading.
The Nasdaq Stock Exchange will remove Super Micro Computers from the Nasdaq 100 Index on December 23rd. This index changes regularly and highlights the largest non-financial companies active in the market.
Apart from index exclusion, accounting policies for super microcomputers are also being considered. In October, auditor Ernst & Young resigned over concerns over internal controls and governance. Following the appointment of BDO USA as auditor, the company asked Nasdaq to postpone its financial reporting. The company does not expect a financial restatement as senior management has not shown any wrongdoing, according to an independent review.
Despite these changes, supermicrocomputers have continued to develop, especially in the field of artificial intelligence. Shares of the leading supplier of high-performance AI servers soared earlier this year.
The company’s current issues have increased the stock’s volatility. Investors were concerned about governance and future prospects, causing the stock price to fall.
Super Microcomputer hopes to comply with this and maintain its listing on the Nasdaq. The company is strengthening its governance and appointing a new CFO to ease investor concerns.
This article first appeared on GuruFocus.
