Supermicro’s sales grew 298% at a 13% margin; Arista’s grew 58% at 64%

01The line: growth sped up at all three

Arista, which sells data-centre switches and the software that runs them, grew 27–38% a year in each quarter from June 2025 to June 2026, then 58.5% in the September quarter. Its chief executive, Jayshree Ullal, called it “the highest year-over-year revenue growth since our IPO”.¹⁴

AMD’s Data Center segment, which holds its Instinct GPUs and EPYC server processors, grew 14% in the June 2025 quarter and 97% in the latest, to US$8.5bn. The company as a whole grew 45% to US$13.4bn, because Client and Gaming fell 8%. AMD says Anthropic, Meta, Microsoft, OpenAI and Oracle Cloud Infrastructure are running models on its first Helios racks.²⁵

Supermicro, which builds servers and whole racks, shrank 15.5% in the September 2025 quarter, then grew 93–123% in each of the next three and 298% in the latest. In August it had guided US$14.5–15.5bn for the quarter; on 20 October it raised that to US$18.5–19.5bn, “primarily due to increased demand for AI platforms”, and reported US$19.9bn.⁶³⁷⁸

02Who keeps the margin

Gross margin is what is left of each dollar of sales after paying for the goods sold: parts, manufacturing and freight. It differs because the three sell different things. AMD designs chips and has them made by contract manufacturers; it kept 53.9% (56% on its adjusted measure). Nvidia, whose GPUs fill many AI servers, kept 75.0% in its latest reported quarter, to 26 July.²⁹ Arista builds switches around chips from what it calls “a predominant merchant silicon vendor”, has them made by third parties and sells its own operating software on them; it kept 63.6%.¹ Supermicro buys the processors, GPUs and memory and assembles them into servers and racks. Its cost of sales was US$17.4bn of its US$19.9bn, leaving 12.7%.³

The thin margin also moves the most. Supermicro’s fell from 9.5% to 6.3% over the second half of 2025, then rose to 17.5% in the June quarter against its own guidance of 8.2–8.4%, which it put down to “a favorable customer and product mix”. For the September quarter it guided 10.4–10.8% and reported 12.7%.⁶³⁷⁸¹⁰ Arista’s stayed between 61.9% and 65.2% in all six quarters.⁴ AMD’s was 39.8% in the June 2025 quarter, after about US$800m of inventory and related charges tied to US export restrictions on its MI308 GPUs for China, and 51.7–54.3% in each quarter since.⁵

03What to watch

The December quarter. Arista guides US$3.9–4.0bn of revenue. AMD guides about US$17bn, plus or minus 3%, which it says is about 66% growth, at a non-GAAP gross margin of about 55%. Supermicro guides US$19.5–21.5bn and US$72–82bn for its year to June 2027, up from the US$65–72bn it gave in August.¹²³¹⁰

The balance sheets. Supermicro used US$434m of cash in its operations in the quarter. Its inventory rose to US$15.05bn from US$12.90bn in June and its receivables to US$9.69bn from US$6.13bn, against cash of US$6.9bn and US$8.6bn of bank debt and convertible notes.³ Arista’s inventory rose to US$3.21bn from US$2.25bn at the end of 2025, and AMD’s to US$11.46bn from US$7.92bn.¹²