Core Viewpoint - Aehr Test Systems, a supplier of semiconductor test and burn-in solutions, is set to present at the 28th Annual Needham Growth Conference in New York on January 13, 2026, at 1:30 pm ET [1] Company Information - The presentation will be led by President and CEO Gayn Erickson and CFO Chris Siu [1] - The company will also engage with institutional investors throughout the day of the conference [1] Access Information - Interested parties can register to access a live or replay video webcast of the presentation via the investor relations section of Aehr's website [1]

Company Overview - Aehr Test Systems is a leading provider of semiconductor test and burn-in solutions, headquartered in Fremont, California [3] - The company has installed thousands of systems worldwide, catering to the increasing quality, reliability, safety, and security needs of semiconductors across various applications [3] - Aehr's innovative products include the FOX-P families of test and burn-in systems, FOX WaferPak Aligner, and FOX DiePak Carrier, among others [3] Financial Results Announcement - Aehr Test Systems will report its financial results for the second quarter of fiscal 2026, which ended on November 28, 2025, on January 8, 2026, after market close [1] - A conference call and webcast will be held at 5:00 p.m. Eastern Time to discuss the results [1][2] Market Position and Product Offerings - The company is positioned within the rapidly growing AI market, providing reliability and testing solutions for AI semiconductor manufacturers [3] - Aehr's product line includes high-power packaged part reliability/burn-in test solutions, particularly for AI accelerators, GPUs, and high-performance computing processors [3] - The FOX-CP system is a low-cost single-wafer compact test solution for logic, memory, and photonic devices, enhancing the company's product offerings [3]

Core Viewpoint - Aehr Test Systems is positioned for significant growth due to its focus on testing solutions for semiconductor devices, particularly in the electric vehicle (EV) and artificial intelligence (AI) sectors [2][3][7]. Group 1: Company Overview - Aehr Test Systems specializes in test solutions for semiconductor devices, including wafer-level burn-in (WLBI) for silicon carbide (SiC) chip manufacturers [3]. - The company has a concentrated customer base, with five large customers accounting for 97%, 93%, and 77% of total sales in fiscal years 2023, 2024, and 2025, respectively [4]. Group 2: Market Dynamics - The semiconductor industry is cyclical, with profits fluctuating significantly between up and down years, making it crucial to monitor market cycles [2]. - The SiC chip market, primarily driven by EVs, has seen a slowdown in growth as automakers have reduced their EV development plans [5]. Group 3: Growth Opportunities - Aehr is expanding its WLBI test solutions to include AI processors, which will diversify its revenue and tap into the growing AI/data center market [7][8]. - The company has secured orders from a leading hyperscaler for AI processor testing, indicating strong future demand [8]. Group 4: Financial Outlook - Analysts project revenue growth of 35% and 26% for Aehr in fiscal years 2027 and 2028, respectively, driven by recovery in the EV market and sustained growth in AI spending [15]. - Teradyne and Advantest, early-stage semiconductor testing companies, have reported strong earnings, suggesting positive trends for later-stage companies like Aehr [11][14].

Company Overview - Aehr Test Systems, Inc. is a California-based supplier of semiconductor test and burn-in equipment [1] - The company's equipment is primarily used by semiconductor manufacturers to identify and mark defective chips at the wafer level [1] Industry Context - The semiconductor testing and burn-in equipment market is critical for ensuring the quality and reliability of chips before they are deployed in various applications [1]

Group 1: AI and Quantum Computing Market Overview - Large and mega-cap stocks dominate investor attention in the AI and quantum computing sectors, with companies like NVIDIA and Tesla playing significant roles [2] - Quantum stocks, such as IonQ, have seen substantial valuation increases, with IonQ's market capitalization exceeding $17 billion [3] Group 2: Small-Cap Stocks to Watch - Small-cap stocks, defined as those with market capitalizations near or below $2 billion, are also involved in AI and quantum computing, with Aehr Test Systems (market cap around $770 million) being a notable example [3][4] - Aehr Test Systems focuses on ensuring chip reliability for hyperscalers by testing AI chips under extreme conditions, potentially leading to long-term cost savings [4] Group 3: Aehr Test Systems Performance - Aehr's stock surged 36% on August 26 following the announcement of follow-on orders from a hyperscaler for its Sonoma machines, although these orders did not significantly impact its financials in the last quarter [5] - The company is currently trading at a forward price-to-earnings (P/E) ratio exceeding 180x, indicating a high valuation relative to earnings potential [6] Group 4: Photronics Overview - Photronics (NASDAQ: PLAB) manufactures photomasks, which are critical in chip manufacturing, and has recently gained attention from investors after a period of low visibility [8]

Core Viewpoint - Aehr Test Systems' stock experienced an 11.6% decline in November, reflecting broader market concerns about a potential AI capital spending bubble, but the stock has rebounded and is up 52% year-to-date, indicating a possible buying opportunity amidst the volatility [2][5]. Company Performance - Aehr Test Systems has faced revenue pressure due to a slowdown in its core market for wafer-level burn-in test systems for silicon carbide chips used in electric vehicles, as automakers have reduced new model releases [2][3]. - The company has successfully secured orders for its WLBI test systems for AI processors, including multiple orders from a leading hyperscaler, which has generated positive market sentiment despite the recent stock decline [5]. Market Sentiment - The decline in November was largely driven by negative sentiment towards AI, influenced by discussions of a potential bubble, which coincided with sell-offs in other AI-related companies like Nvidia [6]. - Despite the negative sentiment, there is a lack of supporting evidence from near-term fundamentals, as companies like Teradyne have reported strong results driven by AI spending, suggesting that the market's concerns may be overblown [9]. Future Outlook - Aehr's CEO indicated that multiple leading companies are requesting benchmark evaluations for their AI processors, suggesting that the AI end markets are strengthening rather than weakening, which could provide a positive outlook for the company [10].

Core Viewpoint - Aehr Test Systems is actively engaging with investors to discuss its expanding role in the semiconductor industry, particularly in enabling next-generation semiconductor devices across various markets [1] Company Participation - President and CEO Gayn Erickson will participate in the 14th Annual NYC Summit investor conference on December 16th [1] - The conference will take place at Mastro's New York, providing a platform for the company to connect with investors and shareholders [1]

Core Insights - Aehr Test Systems has announced the shipment of its Dual-Echo™ test and burn-in system to a leading global market leader in analog and embedded chips, indicating strong demand for its products [1] Company Summary - The shipment of the Dual-Echo™ system highlights the increasing momentum for Aehr's lower-power package-level burn-in systems, which complements the demand for its wafer-level burn-in solutions [1]

Core Viewpoint - Aehr Test Systems has announced a strategic partnership with ISE Labs to enhance wafer-level test and burn-in services for high-performance computing and artificial intelligence applications [1] Company Summary - Aehr Test Systems is a global supplier of semiconductor test and burn-in solutions [1] - ISE Labs, a subsidiary of ASE, Inc., specializes in semiconductor engineering services and is recognized as a leading provider of outsourced semiconductor assembly and test services [1] Industry Summary - The partnership aims to address the growing demand for advanced testing solutions in the high-performance computing and artificial intelligence sectors [1] - The collaboration is expected to leverage ISE Labs' expertise in semiconductor engineering to improve service offerings in the semiconductor industry [1]

Market Overview - The S&P 600 Small Cap Index has increased by 2.0% year-to-date, with a notable return of 5.8% since July, indicating a positive trend for small-cap stocks [1] - Global economic indicators are currently favorable for small-cap stocks, contributing to their upward trajectory [1] Currency and International Dynamics - The weakening U.S. dollar and rising global yields are driving gains in international equities, leading investors to favor international small caps due to a wide valuation gap [2] - Small caps are seen as offering significant upside potential in both valuation and diversification [2] Federal Reserve Influence - The Federal Reserve's plan to cut interest rates is viewed positively for small-cap stocks, as historically, falling interest rates have benefited these stocks more than large-cap stocks [4] - From 1966 to 2023, the S&P 500 returned 16.4% during periods of rate cuts compared to only 6.2% during rate hikes, highlighting the favorable conditions for small-cap stocks in a declining rate environment [4] Small-Cap Stock Recommendations - **Aehr Test Systems**: Year-to-date performance of 55.7%, positioned well in the semiconductor sector with strong momentum in AI and semiconductor testing [6] - **Travelzoo**: Year-to-date performance of -49.7%, seen as undervalued with healthy cash flow and potential for recovery as consumer travel increases [8][9] - **Jazz Pharmaceuticals**: Year-to-date performance of -9.8%, recently received FDA approval for a new cancer treatment and has a promising pipeline with strong analyst support [10][11][12] Investment Strategy - First-time investors in small-cap stocks should exercise caution, using limit orders and diversifying their portfolios to mitigate risks [13] - A long-term investment horizon of at least three years is recommended, as small caps can experience significant annual drawdowns [13] - Maintaining discipline in investment strategies, such as rebalancing and avoiding chasing momentum, is crucial for success in small-cap investing [14]