Key Stats for SMCI Stock
- Price change for SMCI stock: -33%
- $SMCI Share Price as of Mar. 20: $21
- 52-Week High: $62
- $SMCI Stock Price Target: $41
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What Happened?
Super Micro (SMCI) stock collapsed 33% after federal prosecutors unsealed an indictment charging three individuals — including Supermicro co-founder Yih-Shyan “Wally” Liaw — with smuggling AI servers packed with Nvidia chips into China, in violation of U.S. export control laws.
Liaw, who served as both a board member and senior vice president of business development, was arrested on Thursday. Two alleged co-conspirators were also charged: Ruei-Tsang “Steven” Chang, Supermicro’s Taiwan general manager, who remains a fugitive, and third-party contractor Ting-Wei “Willy” Sun, who was also taken into custody.
The scheme, according to the DOJ, ran from 2024 into 2025. The basic setup: Liaw and Chang allegedly directed an unnamed Southeast Asian company to place purchase orders with Supermicro, making it look like the servers were staying in Southeast Asia.
In reality, they were being repackaged and quietly shipped to China. The total value of servers allegedly diverted? About $2.5 billion. In just a three-week stretch in spring 2025, roughly $510 million worth of servers were sent through this pipeline.
To hide the operation, the defendants allegedly staged thousands of fake “dummy” servers at the Southeast Asian company’s warehouse.
Surveillance cameras reportedly caught one of the defendants using a hair dryer to remove and reapply serial number stickers. Those same fake servers were later used to pass a U.S. Department of Commerce audit.
Following the news, Liaw resigned from Supermicro’s board. The company placed both Liaw and Chang on administrative leave and terminated its relationship with Sun. Supermicro said it is cooperating with the government’s investigation and named a new acting chief compliance officer.
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What the Market Is Telling Us About SMCI Stock
SMCI stock was already carrying significant baggage before Thursday’s news. The company has a long history of governance problems.
In 2018, trading was suspended after SEC accounting concerns. In 2020, the company paid a $17.5 million penalty.
In 2024, its auditor Ernst & Young abruptly resigned, saying it could no longer rely on management’s representations. The company eventually replaced EY with BDO USA.
Liaw himself had previously resigned from all positions in 2018 following an internal investigation, and still managed to return to the board in late 2023. That context makes Thursday’s news land even harder.
SMCI stock is not without real business substance.
- Supermicro is a key player in the AI infrastructure buildout, supplying Nvidia GPU-based servers and proprietary liquid-cooling tech to major customers.
- The CEO has flagged $13 billion in orders for Nvidia’s Blackwell product line. But trust is the real problem here.
- When your co-founder is arrested for allegedly smuggling billions in your own products to a sanctioned destination, investors tend to ask what else they might have missed.
Each of the three defendants faces up to 20 years in prison on the most serious charge. Whether SMCI stock can stabilize will largely depend on how deep the government’s investigation goes — and whether it extends further into the company’s leadership.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
