Super Micro (NASDAQ: SMCI) suddenly became one of Tuesday’s standout stocks after the server company gave investors a much better profit picture for the June quarter.

SMCI surged by 15% during Tuesday’s trading session after management said margins should land far above the range issued in May.

The company also reported a rush of new business, with more than $60 billion in orders booked during the fiscal fourth quarter.

The margin update mattered more than the revenue outlook, which stayed within the old range. Traders instead focused on how much more money Super Micro may keep from each dollar of sales, plus the unusually large volume of orders waiting to be filled.

Super Micro raises its margin forecast as AI server demand keeps growing

Super Micro now expects gross margin and adjusted gross margin of 15% to 17% for the quarter. In May, management had guided for only 8.2% to 8.4%. The company said the increase came “primarily due to a favorable customer and product mix.”

Revenue is still expected near the bottom of the earlier $11 billion to $12.5 billion range. Analysts surveyed by LSEG had forecast about $11.67 billion. The company’s fiscal 2026 ended June 30, and its remaining order book finished the year at a record level.

Demand has stayed high for machines built with Nvidia (NASDAQ: NVDA) graphics chips. Those processors power many AI training and inference systems.

The same spending wave has helped other server makers. Dell Technologies (NYSE: DELL) rose 5% after the closing bell, while Hewlett Packard Enterprise (NYSE: HPE) added 4%.

Chief Executive Charles Liang linked Super Micro to another huge data center project in June. Charles wrote on X that he was “proud to co-build another new Gigawatt AI datacenter for SpaceX and xAI within a year.”

SpaceX bought Elon Musk’s xAI through a stock-only deal in February. The combined business is now called SpaceXAI, and SpaceX also owns the X social network.

Chip stocks lead Wall Street while investors ignore tariffs and Red Sea risks

The Dow Jones Industrial Average added 385.38 points, or 0.74%, and closed at 52,224.64. The S&P 500 rose 0.89% to 7,509.20, while the Nasdaq Composite gained 1.29% to 25,837.21. Each index ended a three-session losing run.

Technology was the strongest S&P 500 sector, rising 2.35%. That left technology far ahead of every other sector. Nine of the index’s 11 groups finished higher. Consumer staples fell 1%, making it the weakest sector, while communication services dropped 0.85%.

Sandisk (NASDAQ: SNDK) led the S&P 500 with a 14.3% gain. Western Digital (NASDAQ: WDC) climbed 12.5%, and Micron Technology (NASDAQ: MU) rose 12.2%. The gains placed several memory and storage names near Super Micro on the day’s winner list.

Earnings also helped lift stocks. 3M (NYSE: MMM) jumped more than 7% after its second-quarter profit came in above forecasts. General Motors (NYSE: GM) gained almost 5% after beating estimates for both sales and earnings.

FactSet data showed that about 88% of the roughly 66 S&P 500 companies that had reported results topped profit estimates. Alphabet (NASDAQ: GOOGL), IBM (NYSE: IBM) and Tesla (NASDAQ: TSLA) are due to report later this week.

Investors paid little attention to Trump’s new 50% tariffs on a broad group of Canadian imports. Oil still finished 2% higher after reaching its highest level in five weeks.

Two tankers carrying Saudi crude toward Asia turned back in the Red Sea after Yemen’s Iran-backed Houthis threatened commercial vessels with a blockade. Trump said the United States would answer if the group carried out that threat.

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