Supermicro prices $7 billion equity financing to fund AI server orders

Super Micro Computer (NASDAQ: SMCI) announced pricing for equity and equity-linked financing transactions totaling up to $7 billion in potential gross proceeds, including a $1.25 billion at-the-market offering program.

The company priced concurrent public offerings of 45.5 million common shares at $27.50 per share and 75 million depositary shares at $50 per share. Each depositary share represents a 1/20th interest in newly issued 7.0% series A mandatory convertible preferred stock. Underwriters received options to purchase additional shares in both offerings.

The common stock offering is expected to close June 12, 2026, while the depositary shares offering is scheduled to close June 15, 2026. The closings are not contingent on each other. The at-the-market program sales are not expected to begin until the third quarter of 2026.

Net proceeds from the common stock offering will be approximately $1.22 billion, while the depositary shares offering will generate approximately $3.68 billion, after deducting underwriting discounts and expenses.

Supermicro stated it will use proceeds to fund component purchases for approximately $39 billion in orders for advanced AI servers received from more than 20 customers in recent weeks. The company plans to fulfill these orders in future quarters. Additional proceeds may be used for general corporate purposes including debt repayment, working capital, and capital expenditures.

The mandatory convertible preferred stock will pay dividends at 7.0% annually on a $1,000 liquidation preference per share. Dividends will be payable quarterly starting September 1, 2026. Unless converted earlier, each preferred share will automatically convert into between 30.3040 and 36.3640 common shares on June 1, 2029, based on the stock's volume-weighted average price.

J.P. Morgan, Goldman Sachs, and Citigroup are serving as lead joint bookrunning managers for the offerings.

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