Super Micro Computer, Inc. (SMCI) Earnings Call Transcript & Summary

Welcome to the 2020 Annual Meeting for Super Micro Computer, Inc. Our host for today's call is Charles Liang. [Operator Instructions] I will now turn the call over to your host, Mr. Liang. You may begin, sir.

Thank you. Welcome to this Annual General Meeting of Shareholders of Super Micro Computer, Inc. It is now 2 p.m., and the meeting is now called to order. My name is Charles Liang, I'm the Chairman of the Board and CEO of Super Micro. This meeting is held pursuant to our bylaws and the written notice to all shareholders. In accordance with the bylaws, I will be presiding over this meeting. During the meeting, any question from shareholders to pertain only to the proposed are being considered. We request that should you have any such questions, please enter and submit them in the space provided on the virtual meeting screen, and we will attempt to address properly question after the proposed have been presented. We will not be conducting a general questions-and-answer section at this year's meeting. I'll begin with a few procedural matters we will take on the items to be acted upon. Most of our directors are present today telephonically. In addition to also Sherman Tuan and Sara Liu present in person, Kevin Bauer, our Chief Financial Officer and Corporate Secretary; Suzan Miller of CT Hagberg LLC, who will serve as the inspector of elections; and Chris Griffin of Deloitte & Touche, our independent registered public accounting firm. Although Mr. Griffin will not be making a general statement, he is available to respond to appropriate questions submitted in the space provided on the virtual meeting screen. I will now turn the meeting over to our Chief Financial Officer, Kevin Bauer, who will review and -- the requirement for the meeting and the proposal under the consideration by shareholders. Kevin?

Thank you, Charles. We have an Affidavit from Broadridge, a corporate services company that is assisting us with the meeting, certifying that each stockholder of record and each identifiable beneficial owner as of April 8, 2020, which is the record date for this meeting, was mailed on or about April 21, 2020, an official notice of this meeting, a proxy card and other materials necessary to vote at this meeting. And such materials are available on the website used to access this meeting. Additionally, the list of stockholders entitled to vote at this meeting has been open to the examination of stockholders at the company's executive offices for more than 10 days prior to this meeting as required by Delaware law and is available for inspection on the website used to access this meeting by any stockholder during this meeting. Various affidavits regarding the mailing of the proxy material and the maintenance of the stockholder lists and the oath and certificate of the inspector will be filed with the minutes of this meeting. The named proxies for this meeting are Charles Liang and myself. If you have returned your proxy card, the proxy holders will vote your shares as you indicated on the proxy card. After the votes for all matters are collected and tabulated, the polls will be closed, and I will ask the Inspector of Elections to provide the preliminary results of such voting. Suzan Miller of CT Hagberg LLC is hereby appointed to serve as the Inspector of Elections, and she will determine the presence of a quorum and tabulate the results of the voting. She has filed an oath of office with me for inclusion in the minutes of this meeting. Ms. Miller has informed me that she has examined the proxies received prior to the meeting and has reported that more than 50% of the company's common stock outstanding and entitled to vote at this meeting are represented by proxies. Therefore, a quorum is present for the transaction of business of this meeting in accordance with our bylaws. Since the requirements for calling this meeting have been duly observed and there are represented here more than the necessary number of shares of the outstanding common stock of our company to constitute a quorum, I hereby declare this meeting to be duly constituted for the transaction of all business. The polls for voting on all matters are open. All stockholders entitled to vote at this meeting have the ability to do so online. If you are a stockholder entitled to vote and have not yet voted or if you want to change your previously cast vote, please do so on the website used to access this meeting. Please remember that if you have already voted by proxy, it is not necessary to vote again by online ballot. After voting has been completed on all matters on the agenda, the ballots will be collected and counted. The Inspector of Elections will collect any ballots submitted online during this meeting. The formal business of this meeting is listed in the notice of this meeting and proxy materials that were provided to stockholders. To briefly review the agenda items for today, we will consider 4 items: a, a proposal to elect directors; b, a proposal to approve, on a nonbinding basis, executive compensation; c, a proposal to ratify the Board's selection of Deloitte & Touche LLP as independent auditors for fiscal 2020; and d, a proposal to approve the Super Micro Computer, Inc. 2020 equity and incentive compensation plan. The first matter to be voted upon is the election of the directors. Because the company has not held an annual meeting for the election of directors since the annual meeting following fiscal 2016, at this meeting, stockholders have been asked to elect: a, 3 Class I directors to hold office until the annual meeting following fiscal year 2022; b, 3 Class II directors to hold office until the annual meeting following fiscal year 2020; and c, 2 Class III directors to hold office until the annual meeting following fiscal year 2021. In each case, to hold office until their successors are fully elected and qualified, the Board of Directors recommends the election of the following nominees: a, each of Charles Liang, Tally Liu and Sherman Tuan as Class I directors; B, each of Sara Liu, Michael S. McAndrews and Fred Hwei-Ming Tsai as Class II directors; and each of Daniel W. Fairfax and Saria Tseng as Class III directors. No other nominations have been received in accordance with the company's bylaws, and the nominations for the directors are closed. The second order of business concerns providing stockholders with the opportunity to vote to approve on a nonbinding basis, the compensation of our named executive officers as disclosed in the proxy statement. The Board recommends a vote for such approval and the adoption of the following resolution by stockholders. Resolved that the stockholders of Super Micro Computer, Inc. approve, on an advisory basis, the compensation of the company's named executive officers as disclosed in the company's proxy statement for the annual meeting pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the compensation discussion and analysis, the compensation tables and the related narrative discussion. The third order of business concerns the ratification of the appointment of the company's independent registered public accounting firm. The Audit Committee of the Board of Directors has appointed Deloitte & Touche LLP as the company's independent registered public accounting firm for the fiscal year ending June 30, 2020. The Board of Directors recommends a vote for ratification of the appointment of Deloitte & Touche LLP. The fourth order of business is a proposal to approve the Super Micro Computer, Inc. equity and incentive compensation plan. Previously, upon the recommendation of the Compensation Committee, the Board of Directors approved and adopted, subject to the approval of the company's stockholders at the annual meeting, the Super Micro Computer, Inc. 2020 equity and incentive compensation plan. The Board of Directors recommends a vote for the approval of the Super Micro Computer, Inc. 2020 equity and incentive compensation plan. If there are any questions regarding proposals 1 through 4, please submit them now. There are no questions, which have been submitted via the website. Pursuant to the company's bylaws, only business that has been properly brought before this annual meeting can be transacted at this annual meeting. Stockholders who wish to bring any matter of business before meeting of the company's stockholders must comply with the requirements of our bylaws and U.S. federal securities laws. No stockholder provided notice with respect to any proposed business, therefore, no other business may be transacted at this meeting. The vote required to approve each of the proposals is as follows: The election of directors requires as to each nominee a plurality of the votes cast by the holders of common stock present or represented by proxy and voting at this annual meeting; each of the votes to approve executive compensation on a nonbinding basis, ratify the appointment of the independent registered public accounting firm and approve the Super Micro Computer, Inc. 2020 equity and incentive compensation plan requires the affirmative vote of a majority of shares present in person or represented by proxy and entitled to vote. This concludes the discussion on proposals for today's meeting. Since all those desiring to vote have done so, I hereby declare the polls closed at 2:12 p.m. Pacific Daylight Time. According to the preliminary report of the inspector of elections, the nominated Class I directors, Class II directors and Class III directors have been elected to hold office for their respective terms until their successors are duly elected and qualified. In addition, stockholders approved executive compensation on a nonbinding advisory basis, ratified the appointment of the independent registered public accounting firm and approved the Super Micro Computer, Inc. 2020 equity and incentive compensation plan. I will now turn over the meeting to Charles Liang, our CEO, who will conclude the meeting.

Thank you, Kevin. The full voting results will be reported within 4 business days on a Form 8-K, which will be filed with the Securities and Exchange Commission. Thank you for attending the meeting. This meeting is now adjourned.

This now concludes the meeting. Thank you for joining, and have a pleasant day.