"Super Micro shares cratered 28.37% in Friday trading to $22.06, the steepest single-day drop in months, after the U.S. Justice Department unsealed an indictment charging co-founder Yih-Shyan 'Wally' Liaw and two others with conspiring to smuggle $2.5 billion worth of AI servers containing advanced Nvidia chips to China in violation of U.S. export controls."
"According to Cybernews, the operation involved shipping servers to Taiwan and Southeast Asia, placing them in unmarked boxes, and using hair dryers to swap labels between real AI servers and dummy servers before forwarding them to China."
"Wall Street's reaction reflects not just the legal news but the pattern behind it. One analyst cited by Yahoo Finance called the company 'uninvestable.'"
The Nasdaq composite dropped about 1% as Super Micro Computer's co-founder faced charges for conspiring to smuggle $2.5 billion in AI chips to China. Super Micro shares plummeted 28.37% following the indictment, marking a significant decline. The operation involved deceptive shipping practices to disguise the true destination of the AI servers. The company has a history of legal issues, including past SEC fraud charges and allegations of export violations, contributing to its current uninvestable status according to analysts.
Read at 24/7 Wall St.
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