SMCI Stock Rises Premarket: Four Taiwan Staff Detained In Illegal Nvidia Chip Export Case

Taiwanese prosecutors launched the first phase of the investigation in the case in May.

• Super Micro said it granted Taiwanese authorities access to the employees’ desks and electronic devices and immediately placed all four on administrative leave.
• The U.S. indicted Super Micro co-founder Yih-Shyan "Wally" Liaw and two individuals linked to the company for violating U.S. export controls in March.
• Stocktwits sentiment for SMCI was ‘bullish’ on Thursday.

Super Micro Computer, Inc. shares rose 0.4% in premarket trading on Thursday, after a report said that Taiwanese authorities have detained two staffers at its Taiwan unit as part of an investigation into the alleged illegal export of advanced AI servers containing Nvidia chips.

The servers in question are made by Super Micro and contain Nvidia chips, which are subject to U.S. export controls prohibiting export to ​China. The U.S. indicted Super Micro co-founder Yih-Shyan "Wally" Liaw and two individuals linked to the company for violating U.S. export controls in March.

Although Super Micro distanced itself from the controversy, saying it had no role to play and removing Liaw, its stock took a beating at the time and generated concerns that some customers might cancel orders anyway.

Four SMCI Staffers Detained

In a letter to customers issued in the U.S. on Wednesday, Super Micro Chief Revenue Officer Matthew Thauberger said the four employees had been questioned on June 29 in connection with what he described as a Taiwanese investigation ​regarding the company's sale of products to a technology company in Taiwan, Reuters reported.

Thauberger reportedly said the company gave Taiwanese authorities access to the employees’ desks and electronic devices and immediately placed all four employees on administrative leave while the investigation is underway.

In May, Taiwanese prosecutors launched the first phase of the investigation, detaining three individuals suspected of illegally exporting Super Micro’s high-end AI servers powered by Nvidia chips. Those three remain in custody.

SMCI Retail View, Stock Move

On Stocktwits, the retail sentiment for Super Micro remained ‘bullish,’ unchanged from the previous day, with traders maintaining that the investigation does not directly harm the company’s business.

“SMCI As stated before, SMCI is itself harmed by these 4 employees and is not under investigation as a complete company. It's the misbehavior of some employees, not a general thing of the company,” said a trader.

The development comes amid a sharp slide for the stock. SMCI shares have declined 45% from their recent high on June 2 and are now down 5.5% year to date.

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