This article first appeared on GuruFocus.

Super Micro Computer (SMCI, Financials) said that its fiscal first-quarter earnings were worse than projected, but it stuck to its long-term growth outlook since there is significant demand for AI data center servers. The company didn't meet Wall Street's expectations and its non-GAAP gross margin fell somewhat from the prior quarter. Management, on the other hand, raised its revenue prediction for fiscal 2025 because of a $13 billion order backlog and anticipated growth in investment on artificial intelligence infrastructure. Super Micro indicated that portion of their quarterly revenue deficit was because customers changed their configurations, which pushed some sales into the next reporting period. Analysts said that even while the company's margins are under pressure in the short term, its value seems good, with shares trading about 21% below their historical average price-to-earnings ratio. The stock has been under pressure lately since it missed its profits target, but a number of analysts think the drop is too big, citing the company's growing importance in the AI server market and strong order visibility.