Shares of Super Micro Computer (NASDAQ:SMCI) soared on Wednesday after the server hardware provider reported its fiscal first-quarter results. While sales were down, the company produced solid guidance and announced a share buyback program. The stock was up about 22% at 12:45 p.m. EST.
Super Micro reported first-quarter revenue of $762 million, down about 4.8% year over year but nearly $5 million ahead of the average analyst estimate. The company saw some of its enterprise customers slow their spending during the quarter, but a few "high-profile" customers increased their spending. Adjusted earnings per share came in at $0.55, down from $0.68 in the prior-year period.
Super Micro announced a $50 million share repurchase program along with its results. The program will run through Oct. 31 of next year. "We are currently taking an opportunistic approach to our stock repurchases while we continue to refine our longer-term capital allocation strategy," said Super Micro CEO Charles Liang.
Super Micro expects to return to sequential revenue growth in the second quarter, driven by "a recent improvement in business trends." The company expects revenue between $780 million and $880 million, and adjusted EPS between $0.35 and $0.58. Those ranges compare to analyst expectations of $757.4 million and $0.16, respectively.
Super Micro's revenue and earnings declined in the first quarter, but a strong outlook and a new share buyback program was enough to light a fire under the stock.