• Super Micro Computer stock plunged 27% Wednesday after delaying its annual 10-K financial filing.

• The delay follows a report by Hindenburg Research citing poor internal accounting controls.

• The sharp sell-off weighed on other AI stocks in Wednesay's session.

Super Micro Computer stock plunged as much as 27% on Wednesday after the company delayed its annual 10-K financial filing.

The sharp decline knocked nearly $150 off Super Micro Computer's stock price to around $400, its lowest level since January. The stock is down 67% from its record high reached in March.

In a press release, the AI chip stack supplier said it could not file its annual report for the fiscal year ended June 30 "without unreasonable effort or expense."

"Additional time is needed for SMCI's management to complete its assessment of the design and operating effectiveness of its internal controls over financial reporting as of June 30, 2024," the company said.

Super Micro Computer stressed that despite the 10-K filing delay, it did not update its fiscal year financial results or alter its forward-looking guidance.

The sharp stock-price decline in Super Micro Computer comes just one day after famed short-seller Hindenburg Research released a scathing report on the company.

Part of Hindenburg's bearish thesis was based on an investigation that found poor internal controls for its accounting practices.

"Our 3-month investigation, which included interviews with former senior employees and industry experts as well as a review of litigation records, international corporate and customs records, found glaring accounting red flags, evidence of undisclosed related party transactions, sanctions and export control failures, and customer issues," Hindenburg wrote in its report.

Hindenburg also highlighted that Super Micro Computer paid a $17.5 million fine to the SEC due to "widespread accounting violations."

"All told, we believe Super Micro is a serial recidivist. It benefitted as an early mover but still faces significant accounting, governance, and compliance issues and offers an inferior product and service now being eroded away by more credible competition," Hindenburg Research said.

The sharp sell-off in Super Micro Computer on Wednesday weighed on sentiment for other AI stocks.

Shares of AMD and Dell saw modest losses of about 3% on Wednesday.

Shares of Nvidia dropped as much as 4% in Wednesday trades ahead of its highly anticipated earnings report before paring losses to about 2%.

According to data from Bloomberg, Super Micro Computer is Nvidia's third largest customer, representing almost 9% of its revenue.