Super Micro Computer (NASDAQ: SMCI) Shares fell in trading on Wednesday after the company said it would not be able to file its quarterly 10-Q report on time. The company’s share price ended the daily session down 6.3%.

Supermicro filed with the Securities and Exchange Commission (dry) stating today that it could not meet the deadline for its 10-Q report without unreasonable effort or expense. The failure to meet the filing deadline is likely to stem from the resignation of Ernst & Young (EY) as the company’s financial auditor in October. Shares are now down 57.5% in the past month and could face continued selling unless Supermicro can get its financials back on track and ease investor concerns.

More bad news for Supermicro investors

EY resigned as Supermicro’s financial auditor in October, saying it resigned due to “information that has recently come to our attention, which has caused us to no longer rely on the representations of management and the Board of Audit and do not want to be associated with the financial statements prepared by the management.” The public accounting firm’s decision to withdraw from the role followed a bearish report published by short seller Hindenburg Research in August that alleged repeated accounting violations at the company.

Given that Supermicro hasn’t announced that it has struck a deal with a new auditor, it’s not particularly surprising that the company will miss the 10Q filing deadline. Being about to miss the quarterly filing deadline is certainly bearish news, but it’s not even the most pressing filing issue at the moment.

To stay in compliance with the SEC and continue to trade on major exchanges, companies must file regular financial reports. Supermicro has yet to file its annual 10-K report for its most recent fiscal year, which ended June 30. As a result of the late 10-K filing, Supermicro is in danger of being delisted. Nasdaq change.

Is the worst over for Supermicro stock?

On Nov. 5, Supermicro released unaudited results for the first quarter of its current fiscal year — a period that ended Sept. 30. The company said it expected sales to be between $5.9 billion and $6 billion, below the previous level. guidance for revenue to be between $6 billion and $7 billion.

Making matters worse, investors may have difficulty trusting the company’s preliminary numbers because they have not been audited. Despite growth at the start of the year due to artificial intelligence (you), Supermicro stock is now down about 29% in the 2024 trading period — and it may not be down yet.

To stay in compliance with the SEC and continue to trade on major exchanges, companies must file regular financial reports. If Supermicro ends up being delisted from Nasdaq, the stock would continue to trade over-the-counter — but such an event would almost certainly create further bearish pressure.

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Keith Noonan has no position in any of the shares mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.