Shares of server solutions provider Super Micro (NASDAQ: SMCI) fell 4.8% in the afternoon trading session after Taiwanese prosecutors indicted nine individuals connected to an alleged illegal AI server export operation targeting China.
Prosecutors in Keelung announced on August 24, 2026, that eight defendants were charged with breach of trust and document forgery, including two Super Micro employees and one employee of Nvidia (NASDAQ: NVDA).
A ninth individual faced separate charges tied to siphoning distributor funds, according to Reuters, which first reported the indictments out of Taiwan.
The indictments targeted individuals only, with neither Super Micro nor Nvidia charged as a corporate entity in connection with the alleged scheme.
Officials stated that the defendants were fully aware of existing internal compliance controls and colluded for personal profit, suggesting deliberate circumvention of established safeguards.
After the initial selloff, the stock partially recovered, settling at $35.59 per share, representing a decline of 4.4% from the previous close.
Super Micro shares have demonstrated extreme volatility over the past year, recording 62 moves greater than 5%, which places today’s drop within a broader pattern of sharp price swings.
Eleven days prior, SMCI surged 11.2% following a cooler-than-expected wholesale inflation report that reinforced Federal Reserve rate cut expectations and amplified momentum from a strong earnings release.
The company had reported fiscal fourth-quarter revenue of $11.12 billion, adjusted earnings per share of $1.70, and adjusted EBITDA of $1.67 billion, with gross margins climbing to 17.6%.
Super Micro also disclosed it secured over $60 billion in new orders during that quarter, pushing its backlog to record levels and underpinning exceptional forward guidance.
The company issued a fiscal 2027 revenue target of between $65 billion and $72 billion, reflecting strong demand for its direct liquid cooling solutions within the broader AI infrastructure buildout.
Despite today’s losses, SMCI remains up 14.9% since the start of the year, though the stock continues to trade 39.4% below its 52-week high of $58.68, reached in October 2025.
Investors who purchased $1,000 worth of Super Micro shares five years ago would now hold a position valued at $10,027, illustrating the stock’s significant long-term appreciation despite its persistent volatility.
