Aehr Test Systems (AEHR) Q1 2025 earnings summary

Executive summary

• Q1 fiscal 2025 revenue was $13.1 million, down 36% year-over-year from $20.6 million, primarily due to lower system shipments and weak electric vehicle demand.

• Non-GAAP net income was $2.2 million ($0.07 per diluted share), down from $5.2 million ($0.18 per share) in Q1 FY24; GAAP net income was $0.7 million ($0.02 per share), down from $4.7 million.

• Gross margin improved to 54.7% (non-GAAP) and 54.0% (GAAP), up from 48.7% and 48.4% year-over-year, driven by favorable product mix and increased WaferPak sales.

• Completed the acquisition of InCAL Technology, broadening offerings in high-power AI, medical device testing, and packaged part reliability/burn-in test solutions.

• Expansion into new markets including AI processors, gallium nitride (GaN) semiconductors, hard disk drive components, and flash memory is underway.

Financial highlights

• Q1 revenue: $13.1 million; product revenue: $12.2 million; services revenue: $1.0 million.

• WaferPak revenues were $12.1 million, representing 92% of total revenue, up from 55% in the prior year.

• Operating income was $0.2 million (GAAP), down from $4.1 million; non-GAAP operating income was $1.65 million.

• Cash, cash equivalents, and restricted cash totaled $40.8 million at quarter end, down from $51.1 million a year ago, after $10.6 million was used for the InCAL acquisition.

• Bookings reached $16.8 million and backlog stood at $16.6 million as of August 30, 2024.

Outlook and guidance

• Reaffirmed FY25 guidance: at least $70 million in revenue and pre-tax net profit of at least 10% of revenue.

• Management expects momentum in silicon carbide and new market contributions in AI, GaN, and data storage.

• Expect 85% of annual revenue from wafer-level burn-in and 15% from package part burn-in, with InCAL driving the latter.

• Management expects existing cash resources and anticipated funds from operations to meet operating and capital needs for the next twelve months.

• No material changes to risk factors or business outlook since the last annual report.