Shares in Aehr Test Systems (AEHR 25.90%) had blasted higher by more than 20% at 10 a.m. today on the news of follow-on orders for its artificial intelligence (AI) processor volume production test and burn-in solutions.New orders, new optimism?The news comes less than two weeks after the company released its fourth-quarter 2025 earnings report. Back then, CEO Gayn Erickson took a cautious approach to financial guidance for 2026, saying, "While we remain confident in Aehr's long-term growth prospects, we con ...

On July 14, 2025, Gayn Erickson (President and CEO) reported a disposal of 4,518 shares of Aehr Test Systems (AEHR 4.20%) valued at $62,619 to either pay the exercise price of vested stock, or tax liability with shares instead of cash. This transaction does not amount to a sale of stock by the CEO.Transaction summaryMetricValueShares Traded4,518Transaction Value$62,619Post-Transaction Shares272,511Post-Transaction Value$3.8 millionYTD Performance-11.1% (as on market close on July 16, 2025)Company overviewMe ...

Core Insights - Aehr Test Systems experienced significant stock volatility in 2025, with a 22.2% decline in the first half, following a 56% drop in the first quarter and a subsequent 77.4% rise in the last quarter of the half-year [1][2]. Financial Performance - The company's financial year ends on May 30, and for the fiscal year 2024, the silicon carbide (SiC) wafer-level burn-in (WLBI) market accounted for 90% of its sales [2]. - In fiscal year 2025, SiC WLBI revenue dropped to less than 40% of total revenue, indicating a significant shift in the company's revenue sources [4]. Market Dynamics - ON Semiconductor, a key customer, has faced a sales slowdown, reflecting a broader downturn in the SiC market, particularly in the electric vehicle (EV) sector, influenced by high interest rates and a correction from previous EV spending booms [3]. - The weakening EV market negatively impacted Aehr's growth prospects in the SiC WLBI market during the first three months of fiscal 2025 [4]. Strategic Developments - A turnaround in Aehr's stock occurred after the third-quarter earnings report in April, where management announced plans to expand into new markets, projecting that 35% of revenue would come from the artificial intelligence (AI) processor burn-in market [5]. - The company has secured four customers contributing over 10% of revenue, with three of these being in new markets, including gallium nitride (GaN) semiconductor supply for the automotive sector [5]. Customer Base and Future Outlook - Aehr has identified a major hyperscaler as a first production AI customer in the packaged part burn-in (PPBI) market, with notable customers including Microsoft, Google, Nvidia, ON Semiconductor, and Infineon [7]. - Management believes that AI end markets could be 3 to 5 times larger than traditional SiC markets, which is driving optimism and strength in the current stock price [8].

Core Viewpoint - Aehr Test Systems, Inc. (AEHR) is being highlighted as a potential investment opportunity due to its efforts in diversifying revenue streams and the prospect of returns [1] Company Analysis - The company has initiated a strategy to diversify its revenue streams, which is seen as a positive move for potential growth [1] - The analysis is backed by the author's extensive experience in financial markets and institutions, providing a solid foundation for the investment thesis [1] Market Context - The focus is on mid and small-cap companies, indicating a niche market that may present undervalued investment opportunities [1]

Aehr Systems (NASDAQ: AEHR ) reported Q4 numbers, which did not make investors happy due to tariff uncertainties and sharp declines in sales. I wanted to go through the numbers in more detail and give some comments on the outlook andMSc in Finance. Long-term horizon investor mostly with 5-10 year horizon. I like to keep investing simple. I believe a portfolio should consist of a mix of growth, value, and dividend-paying stocks but usually end up looking for value more than anything. I also sell options from ...

Financial Data and Key Metrics Changes - The company reported revenue of $59 million for the fiscal year, down 11% year-over-year [46] - Non-GAAP gross margin for the full year was 44%, compared to 49.6% in the prior year [46] - Non-GAAP net income for the fiscal year was $4.6 million, or $0.15 per diluted share, down from $35.8 million, or $1.21 per diluted share, in the previous year [46] - Fourth quarter revenue totaled $14.1 million, a 15% decrease compared to $16.6 million in Q4 last year [47] - Non-GAAP gross margin for Q4 was 34.7%, down from 51.5% in the same period last year [49] Business Line Data and Key Metrics Changes - AI processor burn-in now accounts for over 35% of total revenue, up from 0% last year [47] - WaferPak revenues were $4.2 million, representing 30% of total revenue in Q4 [48] - Sales of packaged part burn-in systems accounted for 44% of Q4 revenue [49] Market Data and Key Metrics Changes - The company has diversified its revenue sources, with silicon carbide devices making up less than 40% of revenue this fiscal year, down from over 90% last year [8] - The company is expanding into new markets, including gallium nitride power semiconductors and silicon photonics integrated circuits [29][33] Company Strategy and Development Direction - The company aims to increase research and development investments to support product enhancements and expand its AI customer base [40][55] - The focus for the upcoming fiscal year includes securing and executing orders across various market verticals, with expectations of order growth [41] - The company has completed the integration of InCal, which is expected to create synergies and reduce facility costs by over $800,000 per year [44] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term outlook despite temporary withdrawal of financial guidance due to tariff-related uncertainties [41][54] - The company anticipates growth opportunities in diverse markets, particularly in AI processors and gallium nitride power semiconductors [54] Other Important Information - The company has no debt and continues to invest excess cash in money market funds [52] - The class action claims against the company were voluntarily dismissed, with no related proceedings currently pending [53] Q&A Session Summary Question: Clarification on customer list in investor deck - The updated customer list reflects current customers from the InCal package part burn-in side of the business, not prospects [58][60] Question: AI market potential compared to silicon carbide - The AI market is expected to be significantly larger than the silicon carbide market, with estimates suggesting it could be three to five times larger [63][66] Question: Gross margin decline explanation - The decline in gross margin is attributed to a mix issue, with lower-margin packaged part systems contributing to the overall decrease [72][73]

Financial Data and Key Metrics Changes - The company reported revenue of $59 million for fiscal year 2025, down 11% year-over-year [46] - Non-GAAP gross margin for the full year was 44%, compared to 49.6% in the prior year [47] - Non-GAAP net income for fiscal year 2025 was $4.6 million, or $0.15 per diluted share, down from $35.8 million, or $1.21 per diluted share in fiscal year 2024 [47] - Fourth quarter revenue totaled $14.1 million, a 15% decrease compared to $16.6 million in Q4 last year [48] - Non-GAAP gross margin for Q4 was 34.7%, down from 51.5% in the same period last year [50] Business Line Data and Key Metrics Changes - AI processor burn-in accounted for over 35% of total revenue in fiscal year 2025, compared to 0% in the previous year [48] - WaferPak revenues were $4.2 million, accounting for 30% of total revenue in Q4 [49] - Sales of Sonoma, Tahoe, and Echo package part burn-in systems accounted for 44% of Q4 revenue [50] Market Data and Key Metrics Changes - The company has diversified its market focus, with silicon carbide devices making up less than 40% of revenue in fiscal year 2025, down from over 90% in fiscal year 2024 [6] - The company is expanding into new markets such as gallium nitride power semiconductors and silicon photonics integrated circuits [29][33] Company Strategy and Development Direction - The company aims to increase research and development investment to support product enhancements and expand R&D resources [40] - The focus for fiscal year 2026 includes securing and executing orders across various segments, with expectations for order growth [41] - The company plans to leverage its unique technology in wafer-level burn-in solutions to capture a significant share of the AI processor market [22][24] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about long-term growth opportunities across diverse markets despite uncertainties related to tariffs [54] - The company is confident in its ability to meet potential demand in the AI market and other high-growth sectors [54] - Management noted that the silicon carbide market may experience stronger growth in fiscal year 2027, despite current forecasts suggesting a slowdown [41] Other Important Information - The company completed the integration of InCal, which is expected to create synergies and reduce facility costs by over $800,000 per year [45] - The company has no debt and continues to invest excess cash in money market funds [52] - A class action lawsuit against the company was voluntarily dismissed, with no related proceedings currently pending [53] Q&A Session Summary Question: Clarification on customer list in investor deck - The customer list includes current customers from the InCal package part burn-in side of the business, not prospects [60] Question: Will the 10% customers be named in the K filing? - The new SEC rules do not require naming customers unless prior agreements exist [62] Question: Insights on AI market potential compared to silicon carbide - The AI market is projected to be significantly larger than the silicon carbide market, with estimates suggesting three to five times the size [66]

EX-99.1 2 aehrex991.htm EX-99.1 EXHIBIT 99.1 Contacts: Aehr Test Systems Chris Siu Chief Financial Officer csiu@aehr.com PondelWilkinson, Inc. Todd Kehrli or Jim Byers Investor Contact tkehrli@pondel.com jbyers@pondel.com Fiscal Year Financial Results: Aehr Test Systems Reports Fiscal 2025 Fourth Quarter and Full Year Financial Results Page 2 of 8 An explanation of the use of non-GAAP financial measures and a reconciliation of Aehr's non-GAAP financial measures to the most directly comparable GAAP financial ...

Core Insights - Aehr Test Systems' stock increased by 35.5% in June due to positive developments in targeted end markets, indicating potential for revenue diversification and growth [1] Revenue Sources - The company primarily operates in the silicon carbide (SiC) wafer-level burn-in (WLBI) market, which accounted for 90% of its revenue in 2024 [2] - The electric vehicle (EV) market is a key driver for Aehr's SiC WLBI solutions, but high interest rates are negatively impacting EV sales [3] Market Challenges - Key customers like ON Semiconductor are facing sales declines, with expectations of a 16.5% drop in 2025, necessitating Aehr to explore other markets to mitigate weaknesses in its core business [3] New Revenue Streams - Aehr's revenue from SiC WLBI is projected to drop to less than 40%, while artificial intelligence (AI) processor burn-in is expected to represent over 35% of its business within the first year [4] - In the third quarter, four customers contributed to 10% of Aehr's revenue, with three coming from new markets [4] Positive Market Trends - Continued momentum in AI and GaN WLBI spending was noted, particularly following Nvidia's strong earnings report and its partnership with Navitas Semiconductor, which may lead to potential customer relationships for Aehr [6] Future Outlook - The growth of alternative revenue streams is beneficial for Aehr's investment case, with expectations for improved demand in SiC WLBI as EV investments rise [8] - The company's revenue and earnings remain cyclical, but diversification into new end markets is reducing reliance on EV spending, positively impacting stock performance [8]

Company Overview - Aehr Test Systems (AEHR) shares increased by 9.3% to close at $12.75, with notable trading volume compared to typical sessions, and a total gain of 16% over the past four weeks [1][2] Business Developments - The company's optimism is linked to its diversification into new markets, specifically the gallium nitride (GaN) wafer-level burn-in (WLBI) market, with speculation that Navitas Semiconductor may become a customer [2] Financial Performance - AEHR is expected to report break-even quarterly earnings per share, reflecting a year-over-year change of -100%, with anticipated revenues of $15 million, a decrease of 9.6% from the previous year [3] - The consensus EPS estimate for AEHR has remained unchanged over the last 30 days, indicating that stock price movements may not sustain without trends in earnings estimate revisions [4] Industry Context - Aehr Test Systems operates within the Zacks Electronics - Measuring Instruments industry, where another company, Camtek (CAMT), saw a 2.5% increase in its stock price, closing at $84.1, with a 25.8% return over the past month [4] - Camtek's consensus EPS estimate has also remained unchanged at $0.79, representing a year-over-year change of +19.7% [5]