Shares of SUPER MICRO COMPUTER INC experienced a significant consecutive decline following reports that its co-founder faces charges related to a smuggling case. The U.S. Department of Justice has formally indicted three senior individuals associated with the company. The charges, which include the Senior Vice President of Business Development, a sales manager in Taiwan, and a contractor, allege a conspiracy to violate the Export Control Reform Act by facilitating the smuggling of AI chip servers valued in the billions of dollars. The company's stock plummeted by 33% during the trading session.
On March 19, the U.S. Attorney's Office for the Southern District of New York filed charges alleging that the three individuals from SUPER MICRO COMPUTER INC engaged in schemes to illegally transfer servers worth billions of dollars, circumventing strict U.S. export controls. According to the U.S. allegations, this illegal smuggling channel generated approximately $2.5 billion in related sales since 2024. Notably, between late April and mid-May 2025, servers valued at $510 million were shipped to a Southeast Asian company that never obtained the necessary licenses from the U.S. Department of Commerce. The FBI stated that the case poses a threat to national security. Currently, the co-founder and one other individual have been arrested.
The indictment names the three accused individuals as Liao Yixian, Co-founder, Board Member, and Senior Vice President of Business Development at SUPER MICRO COMPUTER INC; Zhang Ruican, Sales Manager for the Taiwan region; and Sun Tingwei, a contractor collaborating with the company. FactSet data indicates that Liao Yixian holds shares in SUPER MICRO COMPUTER INC valued at $464 million. He has not yet responded to the charges.
The indictment further revealed that a Southeast Asian company acted as a key intermediary in the case. This company not only forged documents falsely claiming the servers were for its own use but also engaged third-party logistics firms to repackage the servers to conceal their true destination. To deceive SUPER MICRO COMPUTER INC's compliance team and U.S. export control officials, the defendants placed "dummy servers" in the Southeast Asian company's warehouse facility during inspections. They simultaneously pressured the compliance team to approve shipments, while the genuine servers equipped with NVIDIA chips were secretly diverted. In a particularly dramatic turn, investigators captured surveillance footage showing the individuals using hairdryers to heat and replace server serial number labels, providing concrete evidence of tampering with hardware traceability information. The individuals involved now face potential prison sentences of up to 30 years.
The news impacted several A-share companies, causing a sharp decline in their stock prices. During afternoon trading, the computing power sector collectively dropped: Xiechuang Data saw its shares approach a 20% drop limit during the session, ultimately closing nearly 15% lower; Chaoxun Communication hit the跌停 limit; Dawei Technology, Hongjing Technology, and Oriental Nations fell over 10%. Xiechuang Data promptly issued a clarification statement regarding investor concerns about server procurement compliance. The company stated that after careful verification, the matters involving certain overseas server manufacturers in illegal transactions are unrelated to the company. Xiechuang Data emphasized that its intelligent computing power products are procured through compliant commercial channels and its operations consistently adhere to market rules and laws. The company further noted it maintains a forward-looking strategic inventory and continues to optimize its diversified supply chain layout to drive steady development of its main business, with current production and operations proceeding normally.
When U.S. markets opened, shares of SUPER MICRO COMPUTER INC fell sharply, dropping over 30%. Conversely, Dell Technologies opened higher, rising over 7% at one point before closing up 0.58%. Dell and SUPER MICRO COMPUTER INC are direct competitors in the enterprise and AI infrastructure space, with their servers, storage, and other solutions being substitutable products. Investors perceive that Dell could capture some market demand shifting away from SUPER MICRO COMPUTER INC amid its legal and operational uncertainties.
In response to the incident, SUPER MICRO COMPUTER INC released a statement clarifying that the company itself is not a defendant in the case. It has suspended Liao Yixian and Zhang Ruican and terminated its relationship with contractor Sun Tingwei. The company stressed that the accused individuals' actions violated company policy and compliance controls, affirming that it maintains a robust compliance system and is committed to strictly adhering to all applicable U.S. export and re-export control laws and regulations.
SUPER MICRO COMPUTER INC is a leading global manufacturer of AI servers and a key partner of NVIDIA. In November 2025, the company disclosed that order bookings for its Blackwell Ultra product line exceeded $13 billion. On February 3, 2026, SUPER MICRO COMPUTER INC reported its financial results for the second quarter and first half of fiscal year 2026: revenue for the period from July 1, 2025, to December 31, 2025, was $17.70 billion, a 52.39% year-over-year increase, while net profit was $569 million, a 23.64% decrease compared to the same period last year.
Some market commentators suggest there is no need for panic, as the stock price may already reflect the worst-case scenario. They note that the U.S. court's charges are directed at individuals, with sentencing and the final investigation having limited direct impact on the company itself, primarily affecting its reputation. They also highlight SUPER MICRO COMPUTER INC's significant, arguably irreplaceable, role as a major U.S. company with thousands of employees in the AI hardware and computing industry.
Other observers indicate that the situation at SUPER MICRO COMPUTER INC could be negative for domestic computing power leasing providers, especially those serving large enterprises requiring high-end NVIDIA cards. However, it is seen as a positive development for domestic alternatives, reinforcing the necessity to support domestic supply chains regardless of performance comparisons.