Supermicro, a major server manufacturer, is facing potential delisting after failing to submit its financial report on time. Previously, the Economic Daily News reported that the company had halted expansion of its Malaysia plant. However, in response to inquiries from the Central News Agency, Supermicro clarified that its plans for the Malaysia facility remain unchanged, with production set to commence by the end of this year, and emphasized that customer orders are “still robust.”

According to the Economic Daily News, Supermicro’s Malaysia plant was originally scheduled to come online in the fourth quarter, doubling the company’s production capacity. However, amid financial turmoil, the project has been temporarily delayed. In response, YTL Group, a key client in Malaysia with close ties to Nvidia, has shifted its AI server orders to Wiwynn’s Malaysia facility, a subsidiary of Wistron, for local support.

When asked about the potential order transfer due to the Supermicro incident, Wistron declined to comment on individual clients and products.

In a written statement to the Central News Agency, Supermicro reiterated, “As previously announced, our Malaysia facility is on track to commence production and shipping by the end of 2024. This plan remains unchanged.”

Supermicro further noted, “We continue to secure substantial business in Malaysia within a highly competitive market, meeting all approved orders on schedule, and customer demand remains strong.”

Founded in 1993 by Taiwanese CEO Charles Liang, Supermicro has benefited from the AI boom, posting exponential growth in revenue each of the past three quarters. However, it missed its financial reporting deadline amid media reports in late September alleging accounting issues, now under investigation by the U.S. Department of Justice.

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• [News] Supermicro’s Financial Crisis Shifts Malaysia’s YTL Group Order to Taiwanese Firm

(Photo credit: Supermicro)

According to a report by Economic Daily News, Supermicro’s ongoing financial crisis has reportedly led to the suspension of its planned expansion at its Malaysia facility, which was set to double its production capacity. This disruption has prompted Supermicro’s major client, Malaysia’s largest conglomerate and a top NVIDIA AI server buyer, YTL Group, to shift its substantial AI data center order.

The same report indicates that YTL Group is now turning to Wistron Group’s Malaysian subsidiary, Wiwynn, for nearby support to fulfill the order, which involves substantial deliveries of NVIDIA’s high-end GB200 NVL72 full-rack servers.

Industry insiders cited by Economic Daily News previously speculated that NVIDIA would lead any order reallocation; however, this shift originates from Supermicro’s client, YTL Group, whose choice of Wiwynn is strategic. Wiwynn’s plant is situated near Supermicro’s new facility in Malaysia, offering a geographical advantage and boasting robust AI server capabilities.

YTL Group has strong ties with NVIDIA. In March, YTL Power, a subsidiary of YTL Group, announced a partnership with NVIDIA to install DGX GB200 NVL72 AI server systems, aiming to establish a green AI data center in Johor, Malaysia.

Originally, YTL’s sizable AI data center project was to be shared between Supermicro and Wiwynn. Supermicro’s Johor plant was expected to double capacity with a new line in Q4, but this plan has been delayed due to financial issues. Wiwynn’s nearby plant has also been expanding, enhancing its one-stop manufacturing services and adding advanced cooling technologies such as direct liquid cooling and immersion cooling to handle the redirected order.

Supermicro CEO Charles Liang, speaking at COMPUTEX 2024, previously unveiled the company’s ambitious Malaysia expansion, aiming to double its output to 10,000 server racks per month by Q4. With the expansion now halted, orders have shifted to Wiwynn.

Wiwynn’s new plant in Johor began assembling server racks last October, and a second phase focusing on motherboard production is expected to go online later this year, with potential plans for a third plant.

Economic Daily News reports that Johor, Malaysia’s largest data center investment hub and the ninth-largest in the Asia-Pacific, currently hosts 13 data centers, with four more under construction. The region’s affordable land, water, and power resources, along with its proximity to Singapore, have drawn multinational companies such as Australia’s AirTrunk and Microsoft, which recently acquired land in Johor for a new data center.

(Photo credit: YTL Power)

In recent years, data center has been one of the key areas for GaN (Gallium Nitride) manufacturers to tap power electronics market, and GaN applications in the data center power supply market have taken a big step forward. Notably, the rise of AI technology has further fueled this market at present.

In the AI ecosystem, data centers have enormous demands for high-speed computing and power. According to a TrendForce report, NVIDIA’s Blackwell platform will be officially launched in 2025, replacing the existing Hopper platform, and will become NVIDIA’s primary solution for high-end GPU, accounting for nearly 83% of all high-end products.

For high-performance AI servers like the B200 and GB200, a single GPU can consume more than 1,000W of power.

Facing soaring power demands, the power specifications for each data center rack will increase from 30-40kW to 100kW, posing significant challenges for data center power systems. The combination of GaN and liquid cooling technologies will be critical to improving energy efficiency in AI data centers.

The hike in chip power consumption requires servers to achieve higher power density and efficiency.

GaN, which reduces energy losses and increases power density, is now seen as one of the key technologies for optimizing energy efficiency in AI data centers, which has attracted many players, including Infineon, Texas Instruments (TI), Navitas, Innoscience, Transphorm, CorEnergy, Danxi Tech, and GaNext, to join the race.

Among them, both Navitas and Infineon have unveiled their AI data center power roadmaps.

Infineon’s AI Data Center Power Roadmap (Source: Infineon)

Combining the unique advantages of Si (Silicon), SiC (Silicon Carbide), and GaN (Gallium Nitride), Infineon has launched a 3 kW PSU and a 3.3 kW PSU, with an 8 kW PSU expected to be available in the first quarter of 2025.

The new 8 kW PSU will support AI racks with outputs of up to 300 kW or more. Compared to the 32 W/in³ density of the 3 kW PSU, its efficiency and power density will increase to 100 W/in³, further reducing system size and lowering operator costs.

In terms of GaN technology, Infineon’s CoolGaN™ solution can provide over 99% system efficiency in PFC topologies. Moreover, GaN Systems, acquired by Infineon, already released a 3.2kW AI server power supply as early as 2022 and unveiled its fourth-generation GaN platform in 2023.

The new platform achieves efficiency exceeding the Titanium level, with power density increased from 100W/in³ to 120W/in³. Thereby, the industry highly expects the synergistic effect created by the combination of these two companies.

Navitas introduced its GaNSafe™ and Gen-3 Fast SiC technology last year, along with a 4.5kW CRPS design, achieving more than double the power density of traditional silicon solutions. In July this year, Navitas unveiled its CRPS185 4.5kW AI data center server power solution, with a power density of 137W/in³ and over 97% efficiency.

Navitas AI Data Center Power Roadmap (Source: Navitas)

Navitas revealed that over 60 customer projects involving 3.2kW and 4.5kW power solutions for data centers are currently under development.

These projects are expected to bring millions of dollars in revenue growth for Navitas’ GaN and SiC business between 2024 and 2025. It aims to begin small-scale production of AI data center power solutions in 2024.

Aside from Infineon and Navitas, other manufacturers like TI, EPC, CorEnergy, GaNext, and Innoscience also set sights on this market.

TI reached an agreement with Delta, the world’s largest server power supply provider (with nearly 50% market share), as early as 2021. Based on GaN technology and TI’s C2000™ MCU real-time control solution, they are developing high-efficiency, high-power server PSU for data centers.

Thus, their joint efforts and future fruit in the AI server power market are highly anticipated.

Beyond AI data center server, humanoid robot industry that enjoys burgeoning growth this year, also injects new vitality into the GaN market.

Humanoid robot is assembled by sensing, control, motor, and battery systems, in which GaN can has its place in LiDAR system, motor drive, DC-DC converter, and battery BMS, among which motor drive plays a critical role.

According to TrendForce, the demand for motor driver in humanoid robot has skyrocketed due to the mounting demands for degrees of freedom.

To achieve higher power output, high-power-density, high-efficiency, and fast-response motor driver are in demand, and GaN is a perfect fit for it, which also has the ability to strengthen overall robot performance in terms of heat management, compact design, and overall system design.

It is reported that Siemens, Yaskawa Electric, and Elmo have already integrated GaN technology into their robotic motors, and the GaN industry chain is gearing up for seizing more opportunities.

Currently, companies such as TI, EPC, Transphorm, Innoscience, Navitas, and CorEnergy are actively promoting GaN adoption in motor drive market. Among them, Transphorm has supplied GaN FET products for Yaskawa Electric’s new servo motor.

TrendForce points out that future robots will exceed our imagination, with precise, fast, and powerful movement capabilities as the key parts, which will inevitably push the motors required to drive these movements advance forward, and this is regarded as a boon for GaN technology.

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• [News] Global GaN Power Device Market Size Expected to Reach USD 4.376 Billion in 2030, CAGR of 49%
• [News] Foundry Giant GlobalFoundries Acquired GaN-Related IP

(Photo credit: Infineon)

On August 27, AI server giant Supermicro was accused of accounting violations, inadequate disclosure of related party transactions, and evading sanctions by selling products to Russia by short-seller Hindenburg Research.

In addition, Supermicro announced on August 28 that it would delay the release of its annual report, potentially facing order withdrawals. Industry sources also believe this news presents a chance for Supermicro’s competitor Dell to gain market share.

Besides Dell, a report from Commercial Times also points out that Hewlett Packard Enterprise (HPE) could benefit from the shift in orders, potentially boosting shipments for its Taiwanese supply chain partners such as Wistron, Inventec, Quanta, and Foxconn.

The report from Commercial Times also cite sources, suggesting that this shift could provide Gigabyte, which is actively promoting its liquid-cooled products for NVIDIA’s H200 series, with  opportunities in the second half of the year.

Wistron, as a key supplier of motherboard and GPU accelerator cards for NVIDIA’s Hopper and Blackwell GPU, is not only a major supplier for Supermicro’s server motherboards but also for Dell. Its clients include HPE and Lenovo as well, which makes the company one of the primary beneficiaries.

Similarly, Inventec, one of the server motherboard suppliers, is also expected to benefit if the shift in orders boosts Dell, HPE, and Lenovo.

Moreover, one of Supermicro’s largest clients, CoreWeave, is transitioning to become a cloud computing service provider specializing in GPU-accelerated computing.

This shift has increased demand for GPU-accelerated computing and liquid cooling solutions. Reportedly, it’s believed that Gigabyte, which holds orders from CoreWeave, could be one of the biggest beneficiaries of the upcoming order shift.

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• [News] Supermicro Faces Order Withdrawal Crisis, Potentially Benefiting Dell
• [News] Quick Couplings’ Buying Surge Reportedly Leads to AI Server Component Shortage Brought up by Supermicro

(Photo credit: Supermicro)

As per a report from Business Insider, Taiwanese AI server giant Wiwynn has filed a lawsuit against Elon Musk’s social platform X (formerly Twitter), claiming it refused to pay USD 120 million for parts. However, this may not be the first time a major Taiwanese server manufacturer has encountered payment disputes with X.

According to a report from Economic Daily News, in the fourth quarter of 2022, MiTAC also faced issues when Musk took over Twitter, potentially leading to unpaid server bills.

After Musk took over Twitter, he aggressively implemented cost-cutting strategies, including layoffs and renegotiating orders with suppliers. MiTAC, as one of Twitter’s server suppliers, might also be impacted, recording a NTD 1.4 billion (around USD 44 million) write-down in inventory and bad debt provisions for accounts receivable in the fourth quarter of 2022.

This directly resulted in a NTD 346 million (roughly USD 10.8 million) loss for that quarter, marking only the second time MiTAC has reported a quarterly loss since its public listing.

Still, due to confidentiality, MiTAC has not disclosed the names of clients with delayed payments.

After navigating the downturn in Q4 2022, MiTAC saw a significant rebound in Q2 2023. During the traditionally slow season for servers, the company achieved notable growth in net profit, with a quarterly increase of 367.11% and a year-over-year increase of 34.72%, reaching an EPS of NT$0.59.

It is reported by Economic Daily News that the surge in profits was largely due to partial payments received from X. Additionally, MiTAC managed to either resell the components it previously reserved for X or retrieve them, which contributed to its soaring quarterly profits.

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• [News] Foxconn Confirms Shipment of NVIDIA’s GB200 to Start in Q4 as Planned
• [News] Foxconn Remains Unfazed Despite NVIDIA’s GB200 Delay, with Customers Aim to Secure Their Orders

(Photo credit: MiTAC)