Super Micro Computer (NASDAQ: SMCI) just announced a blowout quarter. Sort of. Super Micro's fast-growing sales increased 5% sequentially from the previous quarter but exploded by more than 200% compared to the prior-year period.

That's because Super Micro is in the business of providing server and storage system components to data centers building artificial intelligence (AI) capacity. And its bottom-line earnings expanded even more than sales in the quarter. But investors sold the stock in droves anyway today for a couple of reasons.

One big reason the stock tanked after earnings is that it had already soared by more than 700% over the last year as investors anticipated the huge jump in sales. Another is that the costs to generate those growing sales are increasing even faster.

Continue reading

Source Fool.com