Super Micro Computer (NASDAQ:SMCI) shares fell 10% on Thursday following reports that the company lost a sizable contract with Oracle involving Nvidia (NASDAQ:NVDA) GB300 NVL72 server racks.
Contract cancellation worth over $1 billion
According to Bluefin Research, Oracle canceled between 300 and 400 racks previously ordered from Super Micro, with each unit valued at roughly $3.5 million. This implies a total contract value loss estimated between $1.1 billion and $1.4 billion.
The report also suggested that Super Micro had already delivered between 100 and 200 racks before the cancellation occurred.
Cancellation linked to legal concerns
Industry sources cited by Bluefin indicated that the decision may be tied to the indictment of a Super Micro co-founder over allegations of illegally exporting AI GPUs to China.
The research note added that Taiwanese manufacturer Wiwynn is believed to have taken over the rack business following the cancellation.
Slowing demand and product transition challenges
Bluefin also pointed to a slowdown in Super Micro’s xAI-related business after completing shipments of GB300 racks for the Colossus 2 data center earlier this year, with the next-generation Rubin platform still months away from launch.
Inventory concerns weigh on outlook
Additional concerns were raised about excess inventory of B200 GPUs. Supply chain sources described stock levels as “considerable,” according to the report.
The inventory buildup was originally intended for xAI HGX AI server deployments, but demand shifted toward GB200 NVL72 systems as rack adoption accelerated in mid-2025. Those contracts were ultimately awarded to Dell and Hewlett Packard Enterprise.
While Super Micro later secured GB300 NVL72 rack orders from xAI in the second half of 2025, it has reportedly struggled to clear older B200 inventory, according to Bluefin.