With tech shares booming and the potential of artificial intelligence (AI) helping to drive the market, a new name is about to hit the S&P 500. Super Micro Computer (SMCI) gained 13.5% on Friday following the announcement that its stock is to be added to the most popular Wall Street index.
Super Micro Computer shares rise as company added to S&P 500
SMCI’s arrival was announced in a press statement, which confirmed that the company and Deckers Outdoor Corp (DECK) will be replacing Zions Bancorporation (ZION) and Whirlpool Corp (WHR) in the S&P 500 with immediate effect.
SMCI sells AI-optimised computer services to businesses across the planet. It works closely with Nvidia (NVDA) to provide customisable data centre servers using Nvidia’s top-end AI chips. The company’s shares have been rising impressively so far in 2024 thanks to the wave of interest in AI.
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The SMCI share price has risen by more than 300% in the first couple of months of the year. Investors have recently bought up stock on the back of rumours that it was going to be added to the S&P 500 after its market capitalisation reached more than $50bn. Friday saw almost $10bn of the shares exchanged.
The management team aims to reach annual recurring revenue of $25bn. Its predicted revenue from Q3 could reach as high as $4.1bn, which would be a growth rate of more than 200%. For the moment, the company’s annual revenue of $3.67bn gives a year-on-year revenue growth rate of 103%.
