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- 📈 Super Micro Dodges Delisting Bullet
📈 Super Micro Dodges Delisting Bullet
Tesla slumps more than 8%, Meta scores a win over Apple, Thermo Fisher buys Solventum filtration business for $4.1B, Workday beats estimates, Super Micro files financials just ahead of Nasdaq deadline
Evelio Silvera
February 26, 2025
In partnership with
Good morning.
⚡ The Fast Five → Tesla slumps more than 8%, Meta scores a win over Apple, Thermo Fisher buys Solventum filtration business for $4.1B, Workday beats estimates, Super Micro files financials just ahead of Nasdaq deadline
🔎 Market Trends → Wall Street ends mixed in the face of mounting uncertainties; US Futures Climb Ahead of Nvidia Earnings Report
And now…
⏱️ Your 5-minute briefing for Wednesday, February 26, 2025:
MARKET BRIEF
Before the Open
As of market close 02/25/2025.
Pre-Market
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Fear & Greed
Markets in Review
Stocks Slip as Consumer Confidence Wanes; Tesla Skids
The Nasdaq fell 1.4% to 19,026.4, while the S&P 500 lost 0.5% to 5,955.3. The Dow bucked the trend, rising 0.4% to 43,621.2 as defensive sectors led the way. Communication services slumped, while consumer staples and real estate outperformed.
The Big Picture:
Consumer sentiment is slipping. Confidence fell for a third straight month, marking the biggest drop since August 2021, according to the Conference Board. While Americans remain wary about future business conditions, the labor market remains strong, and home prices keep climbing.
Inflation concerns persist. Fed officials are signaling patience, with Richmond Fed President Tom Barkin saying policymakers remain "modestly restrictive" to ensure inflation cools to 2%.
Bond yields slid, with the 10-year Treasury falling 10 basis points to 4.29% and the 2-year yield dipping to 4.10%. Meanwhile, oil prices dropped, with WTI crude slipping 2.2% to $69.16 per barrel as demand concerns weighed on energy markets.
Market Movers:
Tesla (TSLA) fell 8.4%, among the worst S&P 500 performers, after reports showed European sales nearly halved in January. A long-awaited autopilot software update in China also disappointed.
Sempra (SRE) plunged 19%, the biggest S&P 500 decliner, after Q4 earnings missed estimates and the energy firm cut its 2025 outlook.
Solventum (SOLV) jumped 9.5% after Thermo Fisher (TMO) announced a $4.1 billion acquisition of its purification and filtration unit to expand bioprocessing.
Keurig Dr Pepper (KDP) rose 2.4% as the beverage giant posted strong Q4 results and issued a bullish 2025 forecast.
What They’re Saying:
"Tariffs remain top of mind, sparking a rise in consumer inflation expectations and complicating international relationships," Stifel noted.
WHAT WE’RE WATCHING
Events
There are no events scheduled for today.
Earnings Reports
Today: NVIDIA, Salesforce, Lowe’s, TJX Companies, Anheuser-Busch InBev, Monster Beverage, Stellantis, eBay
Tomorrow: Dell, Monster Energy, HP (Hewlett-Packard), Warner Bros. Discovery, Rocket Mortgage, Telefonica, Duolingo
MARKET BRIEF
Leading News
Super Micro (SMCI) Dodges Delisting Bullet, Shares Rocket 22% After-Hours
Photo Credit: Annabelle Chih | Bloomberg | Getty Images
Why it matters:
Super Micro's last-minute financial filing satisfies Nasdaq requirements, removing a significant overhang that had been weighing on this AI infrastructure darling's shares.
Zoom Out:
Super Micro (SMCI) filed its delayed financial statements just hours before Nasdaq's deadline, triggering a 22% after-hours rally. The server maker's auditor, BDO, delivered a clean opinion on the financials, stating they "present fairly" the company's position.
This eleventh-hour submission follows months of uncertainty after SMCI parted ways with Ernst & Young last year amid governance concerns. Despite these headwinds, the company's revenue more than doubled to $14.99 billion in fiscal 2024.
Key Insights:
Control issues acknowledged: Management disclosed "material weaknesses" in financial controls, including IT systems and manual journal entry documentation. Their remedy plan includes hiring additional accounting staff and upgrading systems.
AI tailwinds remain intact: Super Micro's business continues to benefit from soaring demand for Nvidia GPUs used in AI development. Elon Musk's xAI counts among its customers, underscoring its position in the AI infrastructure gold rush.
Risk profile evolving: The company faces lingering concerns from delayed financial reporting, including potential litigation and reputational harm, though immediate delisting fears have subsided.
Market Pulse:
"The Company has received correspondence from the Nasdaq staff that the Company has regained compliance with the filing requirements, and the matter is now closed," Super Micro stated in its release.
Bull’s Take:
Despite governance hiccups, Super Micro remains strategically positioned at the intersection of two powerful forces – enterprise AI adoption and infrastructure modernization. For investors with appropriate risk tolerance, this compliance milestone potentially clears the path for SMCI to resume its focus on capitalizing on the multi-year AI expansion.
Headlines
Meta just scored a small win in its feud with Apple (link)
Tesla’s market cap sinks below $1 trillion as stock slumps more than 8% (link)
Nvidia stock drops ahead of earnings as investors weigh potential Trump export rules, Blackwell delays (link)
Workday beats estimates for revenue and profit, stock jumps (link)
Krispy Kreme stock tumbles to all-time low as doughnut maker softens outlook (link)
Thermo Fisher buys Solventum's purification and filtration business for $4.1 billion (link)
CRYPTO
Fear & Greed
Headlines
DAILY SHARE
On the Socials
*Hat-tip to cryptosum_
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