Supermicro CEO insists ‘no one’ beyond indicted employees were involved in alleged $2.5 billion smuggling scheme

Super Micro Computer CEO Charles Liang spoke out during the company’s fiscal third quarter earnings call to deliver a message. “No one” at the company besides three indicted employees—including cofounder Yih-Shyan “Wally” Liaw—were involved in what prosecutors have called an elaborate scheme to smuggle servers to China in violation of U.S. export controls, said Liang. The stock rose 18% in after-hours trading. The server manufacturer’s third quarter earning call on Tuesday was the first since Liaw and two other defendants were indicted in a criminal investigation over U.S. export controls and an alleged scheme to smuggle $2.5 billion in servers to China. Michael Staiger, the VP of corporate development, informed analysts at the onset of the quarterly call that the company would focus on financial results during the call’s Q&A portion. Unmoved, analysts started the Q&A with questions about the indictment fallout. Staiger said based on what’s known right now, Supermicro doesn’t think it will need to restate earnings, nor does it believe more employees were involved. Later, when another analyst raised the topic of the investigation and the impact on the company again, Staiger attempted to gently rebuff the question by “going back to my earlier comments” that Supermicro itself was not named in the federal indictment. He said there was nothing more to add besides that the company takes the allegations “seriously” and is conducting an internal, board-led investigation into the alleged conduct of those involved. That’s when, Liang, the CEO, chairman, and co-founder, jumped in. “Based on what we know so far, though that could change as the investigation progresses, no one from the company other than those named in the DOJ indictment were involved,” said Liang. “So we have very good confidence [in] our integrity.” Liang did not offer evidence or attribute his declaration to counsel or law enforcement. Gi