Super Micro Computer, Inc. Successfully Closes $2.3 Billion Convertible Senior Notes Offering

SAN JOSE, Calif. – June 26, 2025 – Super Micro Computer, Inc. (NASDAQ: SMCI), a global leader in high-performance server technology and a Total IT Solution Manufacturer for AI, Cloud, Storage, and 5G/Edge, today announced the successful closing of its previously announced private offering of $2.3 billion aggregate principal amount of convertible senior notes due 2030 (the 'notes'). This significant financial maneuver included the full exercise of the option granted to the initial purchasers to acquire an additional $300.0 million aggregate principal amount of notes, underscoring strong investor confidence in Supermicro's growth trajectory and strategic vision.

Details of the Offering

The offering, which initially targeted a smaller principal amount, was upsized due to robust demand from institutional investors. The notes are unsecured, senior obligations of Supermicro, and will bear interest at a rate yet to be fully disclosed but typical for such instruments, payable semi-annually. The conversion features of these notes allow holders to convert them into shares of Supermicro's common stock under certain conditions, providing a potential upside linked to the company's stock performance while offering the safety of a fixed-income instrument.

Strategic Rationale and Use of Proceeds

Supermicro intends to use the net proceeds from this offering for general corporate purposes, which may include working capital, capital expenditures, and potential acquisitions of complementary businesses, products, or technologies. This capital infusion is strategically timed to support Supermicro's aggressive expansion plans, particularly in the burgeoning artificial intelligence (AI) and accelerated computing markets. As demand for AI infrastructure continues to surge, Supermicro's ability to provide scalable and energy-efficient server and storage solutions positions it at the forefront of this technological revolution.

Market Context and Implications

The successful closing of this substantial convertible notes offering reflects several key market dynamics. Firstly, it highlights the strong investor appetite for companies positioned to benefit from the AI boom. Supermicro has been a significant beneficiary of this trend, with its stock experiencing substantial growth over the past year. Secondly, issuing convertible notes allows Supermicro to raise capital at a potentially lower cost than traditional debt, while also deferring potential equity dilution until conversion, if at all. This structure is often attractive to growth companies seeking flexible financing options.

This offering also signals Supermicro's proactive approach to managing its capital structure and ensuring it has ample resources to capitalize on future opportunities. The company's continued innovation in liquid cooling technologies, modular server designs, and comprehensive rack-scale solutions is critical for hyperscale data centers and enterprises deploying advanced AI workloads. The additional capital will likely accelerate research and development efforts, enhance manufacturing capabilities, and expand global market reach.

Investment Insights for Shareholders

For current and prospective investors, this financing event carries several implications:

• Growth Capital: The $2.3 billion infusion provides Supermicro with significant dry powder to fund its ambitious growth initiatives, particularly in the high-growth AI server market. This could translate into accelerated product development and market share gains.
• Dilution Management: While convertible notes carry the potential for future dilution if converted, the terms are typically structured to minimize immediate impact. Investors should monitor the conversion price and conditions, but the immediate benefit is capital without outright equity issuance at current prices.
• Confidence Signal: The oversubscription and full exercise of the initial purchasers' option indicate strong institutional confidence in Supermicro's business model, management, and long-term prospects.
• Financial Flexibility: This offering enhances Supermicro's financial flexibility, allowing it to pursue strategic investments and navigate potential market fluctuations more effectively.

Supermicro's ability to secure such a significant amount of capital through convertible notes underscores its robust market position and the perceived value of its contributions to the rapidly evolving IT infrastructure landscape. The company's focus on delivering optimized solutions for AI, cloud, and 5G/Edge computing continues to drive its success and attract investor interest.