Dive Brief:
- Nvidia CEO Jensen Huang told reporters Saturday that its U.S. partner Super Micro Computer needed to strengthen its export compliance controls and maintained that it insists its partners comply with U.S. trade rules, according to Tom’s Hardware, a tech-focused publication.
- In response to news that Taiwan last week detained three people for allegedly making fraudulent declarations about AI servers made by SMC, Huang said he hoped Super Micro “will enhance and improve their regulation compliance and avoid that from happening in the future,” Bloomberg reported.
- A Super Micro company spokesperson on Tuesday declined to comment but referred to a statement it shared earlier with Bloomberg that asserts recent events underscore the need for “industry-wide solutions that would further help safeguard supply chains and strengthen enforcement of export control laws.”
Dive Insight:
The rebuke from Nvidia’s CEO comes two months after Super Micro’s co-founder, another executive and a contractor — all no longer affiliated with the company — were indicted in the U.S. in connection with a smuggling scheme involving billions of dollars of servers with AI chips diverted to China.
Separately, Super Micro’s protracted effort to remediate internal controls and material weaknesses cited in an adverse opinion from the public audit firm BDO early last year has drawn scrutiny from accounting experts.
On Friday, Francine McKenna, author of The Dig substack column on accounting, told CFO Dive that it would be difficult for Super Micro to fix its internal controls given the upheaval and leadership uncertainty swirling around the company.
Last week, the company announced Don Clegg, senior vice president of worldwide sales, retired on May 15 and will serve as an independent consultant for six months, earning $19,450 monthly, according to a securities filing. The resignation is not the result of any disagreement with the company related to its operations, policies or procedures, the filing states.
The company also has yet to hire a new CFO, a recommendation that came in late 2024 from an independent special committee tasked with investigating the integrity of Super Micro’s audit committee, company management and other matters. David Weigand, tapped as CFO in 2021, remains the company’s finance chief.
In its statement, Super Micro also defended its compliance systems.
“Our robust compliance frameworks, supported by rigorous due diligence in alignment with Nvidia and other partners, including pre and post-shipment verifications, are critical steps to address the risk of illicit diversion of highly sought-after technology into restricted markets,” the statement said.
Nvidia did not immediately respond to requests for comment.
