On October 31st, there were significant fluctuations in the AI sector of the overnight US stock market. AI giants such as supercomputers and AMD encountered a "black swan", with AMD plummeting by over 34% and AI chip giant AMD's stock price dropping by over 10%.
On October 30th local time, according to the latest SEC filing submitted by Supermicro Computer, Ernst&Young has resigned from its audit position for the struggling server manufacturer Supermicro Computer, citing concerns about the company's governance and transparency. Supermicro added in the statement that the company has started searching for a new accounting firm.
In the resignation letter, Ernst&Young stated, "We have decided to resign due to recent information that has made it impossible for us to continue relying on statements from management and the audit committee, nor do we wish to have any further association with financial statements prepared by management. We have ultimately concluded that we are unable to continue providing audit services in compliance with relevant laws or professional obligations
This news caused Supermicro Computer to plummet by 38% before Wednesday's trading session, with a maximum drop of over 34% after opening and a closing drop of 32.68%. Supermicro announced in August that it would postpone the submission of annual financial documents, while a special committee is evaluating the internal control of financial reporting.
Last month, there were media reports that the US Department of Justice launched an investigation into allegations made by a former employee of Supermicro that the company had violated accounting rules. Hindenburg Research, a short selling firm, subsequently cited allegations from the former employee in a research report on Supermicro, stating that the company had evidence of "obvious accounting fraud, undisclosed related party transactions, sanctions and export control errors, and customer issues".
Supermicro computers sell high-performance servers for AI data centers, and the demand for their products has grown rapidly driven by the artificial intelligence boom. AMD's clients include important players in the AI field such as Nvidia, AMD, and Intel.
Another AI giant stock, AMD, also fell sharply. Due to the unsatisfactory fourth quarter revenue guidance for investors, the stock price of chip giant AMD fell by over 10%. Although the company now expects to generate over $5 billion in revenue from so-called AI accelerators this year, higher than the previously expected $4.5 billion, some investors had expected even greater growth.
AMD is catching up with Nvidia in this lucrative chip market, where chips are used to develop and operate AI services. Although AMD has now achieved billions of dollars in revenue from such products, a rapid increase compared to last year, this level is still far below its competitor Nvidia's tens of billions of dollars in revenue. During the conference call after the performance announcement, CEO Su Zifeng responded to concerns about AMD's insufficient growth. She stated that the company is accelerating production and gradually gaining the trust of large data center companies that rely on AI accelerators.