Super Micro management told shareholders it needs time to complete an assessment of the internal controls of its financial reporting.

A representative confirmed to Fortune that Super Micro will not file its annual report for fiscal year 2024 within “the prescribed time period,” but didn’t offer any indication as to when the report will be filed. “Additional time is needed to assess some internal controls,” the representative said, echoing the company’s public statements.

The filing delay comes after Super Micro was hit with accusations of accounting manipulation and sanctions evasion by activist short-seller Hindenburg Research on Tuesday.

In a 19,000-word short report, Hindenburg Research said it found “glaring accounting red flags, evidence of undisclosed related party transactions, sanctions and export control failures,” and more. The short-seller and research firm conducted a three-month investigation into Super Micro that included interviews with insiders, industry experts, and a review of accounting and litigation records. The controversial firm is named after the famed airship disaster, and targets companies it believes are headed for a dramatic fall. Hindenburg’s posts often trigger major stock price drops, or legal and regulatory investigations.

“The company does not comment on rumors and speculation,” a representative for Super Micro told Fortune when asked about the short report.

Super Micro provides servers, networking equipment, storage systems, and other critical components and solutions for data centers. With the AI boom in full swing in recent years, demand for its products has exploded. The company, which was founded by Charles Liang in 1993, was added to the Fortune 500 for the first time this year after its annual fiscal revenue hit a record $7.12 billion.

Investors were quick to notice Super Micro’s AI opportunity over the past few years. Its stock soared 6,368% from around $19 per share in August 2019 to an intraday peak of $1,229 on March 8 of this year. Just 10 days later, the company was added to the S&P 500 index in “recognition of remarkable growth in sales and market capitalization.”

More recently, however, Super Micro has struggled. Though the company’s revenue has continued to grow impressively, margins have been under pressure owing to rising server production costs and competition from Dell, Hewlett Packard Enterprise, IBM, and others. Gross profit margins fell to 11.3% in the company’s fiscal fourth quarter that ended in June, down from 17% a year ago. Now, after Hindenburg’s short report, Super Micro shares are down more than 65% from their March peak. 

The Super Micro allegations

Hindenburg’s short report includes a number of serious allegations of impropriety, while also detailing why Hindenburg founder Nathan Anderson and his team are bearish on Super Micro stock. Fortune could not independently verify all of the claims in Hindenburg’s report. 

One of the more serious allegations involves a claim that Super Micro continues to engage in accounting violations for which it was previously fined by the Securities and Exchange Commission (SEC). 

In August 2020, Super Micro and its former CFO, Howard Hideshima, were charged by the SEC for “widespread accounting violations”—in particular, improperly recognizing revenue and understating expenses over a three-year period. 

Melissa Hodgman, an associate director in the SEC’s Division of Enforcement, said in a statement after the charges were filed that misreporting revenue in this way can give “investors a distorted view of a company’s financial condition.”

Hindenburg went a step further on Tuesday, arguing this resulted “in artificially elevated sales, earnings, and profit margins.” Even worse, the short-seller alleged that just three months after Super Micro paid $17.5 million to settle its charges with the SEC, the company began rehiring former executives who were involved in the scandal.

“A former salesperson told us: ‘Almost all of them are back. Almost all of the people that were let go that were the cause of this malfeasance,’” Hindenburg’s report reads.

Super Micro was also shipping high-tech products to Russia in violation of U.S. export bans, including components that could potentially be used for military purposes, according to Hindenburg.

“Exports of Super Micro’s high-tech components to Russia have spiked ~3x since the invasion of Ukraine, apparently violating U.S. export bans, according to our review of more than 45,000 import/export transactions,” the short-seller’s report reads.

The final major accusation involves questionable financial relationships at Super Micro. Hindenburg noted that $983 million has been paid to Super Micro’s suppliers, Ablecom and Compuware, over the past three years. The issue, according to Hindenburg, is that these companies are controlled and partly owned by Super Micro CEO Charles Liang’s brothers, Steve Liang and Bill Liang. 

As of the end of 2023, Steve Liang was Ablecom’s largest shareholder and CEO, according to SEC filings. And Bill Liang was CEO of Compuware, a member of Compuware’s board of directors, and a holder of “a significant equity interest in Compuware.”

Hindenburg noted that 99.8% of Ablecom’s exports to the U.S. and 99.7% of Compuware’s U.S. exports went to Super Micro, according to trade records. “The relationships seem oddly circular,” Hindenburg’s report reads.

Hindenburg’s background 

Founded by Anderson in 2017, Hindenburg Research is a short-seller known for its big, and typically very public, bets against some of the finance world’s biggest fish.

In April 2023, it targeted billionaire Carl Icahn, who made his name as a “corporate raider” in the 1980s, alleging that his namesake company, Icahn Enterprises, had artificially inflated asset values and offered an unsustainable dividend to lure retail investors into a “Ponzi-like” structure. Icahn Enterprises eventually cut its dividend in half, and its shares have plummeted nearly 75% since the release of Hindenburg’s short report. Icahn also settled charges with the SEC this year, agreeing to pay $2 million in penalties for failing to disclose that he pledged the majority of his Icahn Enterprises stock for billions in personal margin loans.

Hindenburg had a major run-in with Indian billionaire Gautam Adani in 2023 as well, then Asia’s richest man, alleging that he was engaged in “a brazen stock manipulation and accounting fraud scheme over the course of decades.” The short-seller is also known for targeting the electric-vehicle maker Nikola in 2020 with accusations that the company made exaggerated claims about its vehicles, engaged in fraudulent marketing, and misrepresented its financial status. Nikola’s market cap has dropped from $34 billion at its 2020 peak to just over $330 million today.

Now, Super Micro, the market’s AI favorite, is under Hindenburg’s intimidating microscope—and, like always, lawyers are circling, asking investors with major losses to come forward for their investigation into “potential securities claims.”