Supermicro shares soared early Wednesday after the artificial intelligence server manufacturer delivered an optimistic business update that caught Wall Street’s attention. The stock jumped 24% in early trading following the company’s announcement that gross margins are poised to nearly double in the coming quarters.

The major driver behind the stock surge is a massive wave of fresh demand for AI infrastructure. “Backlog rose to record levels at the end of fiscal 2026 with total new orders in excess of $60 billion received during the fourth quarter of fiscal 2026,” said the company in its business update.

In light of the heavy order volume, the hardware maker substantially boosted its profit outlook. Supermicro said it expects its gross margin to be in the range of 15% to 17%, significantly higher than the company’s prior guidance of 8.2% to 8.4%, “primarily due to a favorable customer and product mix.”

Supermicro designs and builds servers and data center systems that incorporate semiconductors from chipmakers like Nvidia, Intel, and AMD. As tech giants continue pouring money into computing infrastructure, Supermicro remains positioned at the center of the ongoing AI hardware expansion.