Aehr Announces Preliminary Financial Results for its Fiscal 2024 Third Quarter; Provides Updated Full Year Revenue Guidance
Aehr Test Systems (AEHR) announces preliminary financial results for Q3 fiscal 2024, highlighting delays in wafer level burn-in system orders for semiconductor devices used in electric vehicles impacting revenue and profitability. The company provides updated revenue guidance for the full fiscal year, expecting total revenue of at least $65 million. President and CEO Gayn Erickson discusses the factors contributing to the revenue impact and forecasts a temporary slowdown in orders due to softness in the semiconductor market.
Positive
Aehr Test Systems (AEHR) expects revenue of approximately $7.6 million for Q3 fiscal 2024.
The company anticipates GAAP net loss of approximately $1.5 million to $1.8 million for the same period.
Non-GAAP net loss is projected to be around $0.9 million to $1.2 million, excluding stock-based compensation impact.
Q3 fiscal 2024 bookings are reported at $24.5 million with a backlog of $20 million as of February 29, 2024.
For the full fiscal year ending May 31, 2024, Aehr forecasts total revenue of at least $65 million.
GAAP net income is expected to be approximately $11 million or more, with non-GAAP net income around $14 million or more, excluding stock-based compensation.
President and CEO Gayn Erickson attributes revenue impact to softness in semiconductor capital spending, particularly in automotive applications.
Erickson predicts a temporary slowdown in orders due to shifts in electric vehicle introductions and ramps.
Despite temporary delays, Aehr remains optimistic about long-term growth opportunities in semiconductor wafer level test and burn-in markets.
The company plans to discuss market impact and customer engagements further in an upcoming earnings call on April 9th.
Negative
The delays in wafer level burn-in system orders for semiconductor devices used in electric vehicles have created a short-term gap in revenue and profitability for Aehr Test Systems (AEHR).
Softness in the overall semiconductor capital spending, particularly in automotive applications, has impacted Aehr's fiscal year revenue.
The recent overall softness in semiconductors and shifts in electric vehicle introductions and ramps are expected to impact Aehr's bookings and revenue forecasts for another quarter or two.
The preliminary financial results from Aehr Test Systems highlight a short-term challenge in revenue and profitability due to delayed orders in the semiconductor devices segment for electric vehicles. This is reflective of a broader trend in the semiconductor industry where capital expenditure is sensitive to inventory gluts and market demand fluctuations. The updated revenue guidance, with a projected net loss in the third quarter but an anticipated net income for the full year, suggests a recovery in the fourth quarter that investors should monitor closely. The bookings and backlog figures provide a mixed signal; while there is a substantial backlog, the conversion of these bookings into recognized revenue will be critical for Aehr's financial health.
Moreover, the company's focus on wafer level test and burn-in equipment for critical reliability testing in various high-growth sectors like electrification infrastructure and AI processors indicates a strategic positioning for long-term growth. However, the reliance on a few high-value orders, especially in the volatile electric vehicle sector, raises concerns about revenue concentration risks. The short-term outlook may be affected by current market softness, but the long-term prospects seem intact, assuming the semiconductor industry rebounds as forecasted by Aehr's management.
From a market perspective, Aehr Test Systems' preliminary report underscores the importance of the electric vehicle (EV) sector as a driver for semiconductor test equipment demand. The delay in orders for wafer level burn-in systems used in silicon carbide power semiconductors for EVs is indicative of a broader slowdown in the EV market, which has been affected by shifts in vehicle introductions and production ramps. This slowdown is a temporary but significant factor influencing Aehr's performance.
However, the company's optimistic outlook for the semiconductor wafer level test and burn-in market, with expectations of growth throughout the decade, suggests that Aehr is banking on the expanding electrification and digitalization trends. The mention of diversification into markets such as machine learning, AI processors and semiconductor memory indicates that Aehr is not solely dependent on the EV market and is looking to mitigate sector-specific risks by tapping into other growing areas of semiconductor usage. Their unique offering could position them well to capture market share as these sectors expand, provided they can navigate the short-term market softness effectively.
The mention of inventory-related headwinds and capital spending push-out in Aehr's announcement is a reflection of the cyclical nature of the semiconductor industry. This cycle is particularly pronounced in the capital-intensive segments like semiconductor test and burn-in equipment. Aehr's experience with order delays is not isolated but part of a larger industry trend where semiconductor companies adjust their capital expenditure in response to inventory levels and demand forecasts.
The company's focus on silicon carbide semiconductors, which are important for EV power systems, is noteworthy as this material is expected to become increasingly important due to its efficiency advantages over traditional silicon in high-power applications. Aehr's proprietary technology for wafer level test and burn-in could give them a competitive edge as the demand for silicon carbide semiconductors grows. However, the current softness in the semiconductor market, particularly in automotive applications, poses immediate risks to revenue streams, which could impact Aehr's short-term financial performance despite their positive long-term market outlook.
03/25/2024 - 07:30 AM
FREMONT, CA / ACCESSWIRE / March 25, 2024 / Aehr Test Systems (NASDAQ:AEHR), a worldwide supplier of semiconductor test and burn-in equipment, today announced preliminary financial results for its third quarter of fiscal 2024 ended February 29, 2024. Preliminary results reflect delays in wafer level burn-in system orders for semiconductor devices used in electric vehicles that have created a short-term gap in revenue and profitability. Additionally, Aehr provided updated revenue guidance for its full fiscal year ending May 31, 2024.
For the fiscal third quarter ended February 29, 2024, Aehr expects:
Revenue of approximately $7.6 million GAAP net loss of approximately $1.5 million to $1.8 million , or $0.05 t o $0.06 per diluted share Non-GAAP net loss of approximately $0.9 million to $1.2 million , or $0.03 t o $0.04 per diluted share, which excludes the impact of stock-based compensation Bookings of $24.5 million Backlog as of February 29, 2024, of $20 million For the fiscal 2024 full year ending May 31, 2024, Aehr expects:
Total revenue of at least $65 million GAAP net income of approximately $11 million or more, or $0.38 per diluted share Non-GAAP net income of approximately $14 million or more, or $0.48 per diluted share, which excludes the impact of stock-based compensation 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 measures will be included when Aehr releases its full financial results for the fiscal 2024 third quarter on April 9, 2024.
Aehr Test Systems President and CEO Gayn Erickson commented: "As we discussed in our second quarter earnings call, we had seen several push outs of forecasted orders by current and new customers that impacted our fiscal year revenue. We believe that this was due to two key factors. There is clearly softness in the overall semiconductor capital spending, particularly in automotive applications, related to a glut in inventory driving down near-term orders to these companies and has caused them to push out capital spending and drive cost reductions. Multiple companies including the companies we had expected orders from have publicly discussed inventory related headwinds in their public earnings calls and press releases. In addition, we have seen specific shifts in order timing of our equipment used for wafer level test and burn-in of silicon carbide power semiconductors used in electric vehicles. In just the last two weeks of the quarter, we saw delays in orders for silicon carbide systems with customer-requested ship dates within the quarter as well as a last-minute push out by a customer of a system in our backlog. The net effect of this was a significant shift in revenues out of the third and fourth quarters. Until this time, we had been hearing from those customers that their silicon carbide-based capital investments were not being impacted.
"It is now clear that the recent overall softness in semiconductors and the impact of shifts in electric vehicle introductions and ramps are impacting our bookings and revenue forecasts more than we understood only two months ago at our last earnings call. We now expect this to last for another quarter or two before the orders resume based on the latest roll up of direct forecasts from over a dozen silicon carbide companies. We are now forecasting revenue for the full fiscal year to be $65 million or more, representing revenue of at least $15.4 million in our fiscal fourth quarter. We still expect to finish the year with near or above record annual revenue for the year.
"Our discussions with customers indicate to us that the key markets Aehr is addressing for semiconductor wafer level test and burn-in have significant long-term growth opportunities that will continue to expand throughout this decade. Despite what we believe are temporary delays in current and new customer orders, we believe Aehr will experience significant order, revenue, and earnings growth from these market opportunities. Our unique, proprietary wafer level test and burn-in offering for semiconductors addresses the need for the critical reliability testing and screening of semiconductors used in the worldwide electrification infrastructure, battery and hybrid electric vehicles, data and telecommunications and data storage, machine learning and Artificial Intelligence processors and communications chips, and in the large and growing semiconductor memory market. We look forward to discussing the impact and timing of these markets and the increase in customer engagements in all these markets on our earnings call planned for April 9th ."
Cautionary Statement Regarding Preliminary Results
The foregoing preliminary financial information reflects management's current views with respect to the Company's financial results. These preliminary results remain subject to the completion of normal quarter-end accounting procedures and closing adjustments. Aehr plans to release its full financial results for the fiscal 2024 third quarter on April 9, 2024, and will provide the time and conference call details in a later press release. No independent registered public accounting firm has reviewed, examined, or performed any procedures with respect to, nor have they expressed any form of assurance on, these preliminary estimated results.
About Aehr Test Systems
Headquartered in Fremont, California, Aehr Test Systems is a leading provider of test solutions for testing, burning-in, and stabilizing semiconductor devices in wafer level, singulated die, and package part form, and has installed thousands of systems worldwide. Increasing quality, reliability, safety, and security needs of semiconductors used across multiple applications, including electric vehicles, electric vehicle charging infrastructure, solar and wind power, computing, data and telecommunications infrastructure, and solid-state memory and storage, are driving additional test requirements, incremental capacity needs, and new opportunities for Aehr Test products and solutions. Aehr has developed and introduced several innovative products including the FOX-PTM families of test and burn-in systems and FOX WaferPakTM Aligner, FOX WaferPak Contactor, FOX DiePak® Carrier and FOX DiePak Loader. The FOX-XP and FOX-NP systems are full wafer contact and singulated die/module test and burn-in systems that can test, burn-in, and stabilize a wide range of devices such as leading-edge silicon carbide-based and other power semiconductors, 2D and 3D sensors used in mobile phones, tablets, and other computing devices, memory semiconductors, processors, microcontrollers, systems-on-a-chip, and photonics and integrated optical devices. The FOX-CP system is a low-cost single-wafer compact test solution for logic, memory and photonic devices and the newest addition to the FOX-P product family. The FOX WaferPak Contactor contains a unique full wafer contactor capable of testing wafers up to 300mm that enables IC manufacturers to perform test, burn-in, and stabilization of full wafers on the FOX-P systems. The FOX DiePak Carrier allows testing, burning in, and stabilization of singulated bare die and modules up to 1024 devices in parallel per DiePak on the FOX-NP and FOX-XP systems up to nine DiePaks at a time. For more information, please visit Aehr Test Systems' website at www.aehr.com .
Safe Harbor Statement
This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements generally relate to future events or Aehr's future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as "may," "will," "should," "expects," "plans," "anticipates," "going to," "could," "intends," "target," "projects," "contemplates," "believes," "estimates," "predicts," "potential," or "continue," or the negative of these words or other similar terms or expressions that concern Aehr's expectations, strategy, priorities, plans, or intentions. Forward-looking statements in this press release include, but are not limited to, future requirements and orders of Aehr's new and existing customers; bookings forecasted for proprietary WaferPakTM and DiePak consumables; Aehr's ability to receive orders and generate revenue in the future, including the timing of Aehr's ability to recognize revenue in the future, as well as Aehr's beliefs regarding the factors impacting the foregoing; preliminary financial guidance for the third quarter of fiscal 2024; financial guidance for the full fiscal year 2024, including related to revenue, and expectations regarding fiscal 2024; and expectations related to long-term demand for Aehr's products and the attractiveness of key markets. The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in Aehr's recent Form 10-K, 10-Q and other reports filed from time to time with the Securities and Exchange Commission. Aehr disclaims any obligation to update information contained in any forward-looking statement to reflect events or circumstances occurring after the date of this press release.
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SOURCE: Aehr Test Systems
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What is Aehr Test Systems' (AEHR) revenue expectation for Q3 fiscal 2024?
Aehr Test Systems expects revenue of approximately $7.6 million for Q3 fiscal 2024.
What is the projected GAAP net loss range for Aehr Test Systems in Q3 fiscal 2024?
Aehr Test Systems anticipates a GAAP net loss of approximately $1.5 million to $1.8 million for Q3 fiscal 2024.
What are the reported bookings for Aehr Test Systems in Q3 fiscal 2024?
Aehr Test Systems reports bookings of $24.5 million for Q3 fiscal 2024.
What is Aehr Test Systems' (AEHR) total revenue expectation for the full fiscal year ending May 31, 2024?
Aehr Test Systems forecasts total revenue of at least $65 million for the full fiscal year ending May 31, 2024.
When is Aehr Test Systems' earnings call planned to discuss market impact and customer engagements?
Aehr Test Systems plans to discuss market impact and customer engagements in an earnings call scheduled for April 9th.
