Download PDF

1. Company Snapshot

1.a. Company Description

Aehr Test Systems provides test systems for burning-in and testing logic, optical, and memory integrated circuits worldwide.It offers products, such as the ABTS and FOX-P families of test and burn-in systems and FOX WaferPak Aligner, FOX-XP WaferPak Contactor, FOX DiePak Carrier, and FOX DiePak Loader.The ABTS system is used in production and qualification testing of packaged parts for lower power and higher power logic devices, as well as various common types of memory devices.


The FOX-XP and FOX-NP systems are wafer contact and singulated die/module test and burn-in systems used for burn-in and functional test of complex devices, such as memories, digital signal processors, microprocessors, microcontrollers, systems-on-a-chip, and integrated optical devices.The FOX-CP system is a single-wafer compact test and reliability verification solution for logic, memory, and photonic devices.The WaferPak Contactor contains a unique full wafer probe card capable of testing wafers up to 300mm that enables IC manufacturers to perform test and burn-in of full wafers on Aehr Test FOX systems.


The DiePak Carrier is a reusable, temporary package that enables IC manufacturers to perform final test and burn-in of bare die and modules.Aehr Test Systems was incorporated in 1977 and is headquartered in Fremont, California.

Show Full description

1.b. Last Insights on AEHR

Aehr Test Systems' recent stock performance was negatively driven by weak Q2 earnings and revenue, missing estimates by $0.01 and $5.5 million, respectively. The company's earnings guidance also disappointed investors, contributing to its stock decline. Furthermore, the company is facing securities law violations and class action lawsuits, which may impact investor confidence and drive down the stock price.

1.c. Company Highlights

2. Aehr Test Systems' Revenue Growth Driven by AI Processor Demand

Aehr Test Systems reported a revenue of $11 million for the first quarter of fiscal 2026, a decrease from $13.1 million in the same period last year. The decline was attributed to a strong consumables revenue quarter last year, making direct comparisons challenging. Non-GAAP gross margin for the quarter was 37.5%, down from 54.7% year-over-year, primarily due to lower sales volume and a less favorable product mix. Non-GAAP operating expenses were $5.9 million, an 8% increase from $5.5 million last year. The company's EPS was $0.01, in line with estimates. The backlog at the end of Q1 was $15.5 million, with $2 million bookings received in the first five weeks of 2026.

Publication Date: Oct -28

📋 Highlights
  • Revenue Growth:: Q1 revenue reached $11 million, driven by demand for FOX CP/XP products and contact revenues of $2.6 million (24% of total revenue).
  • Backlog Expansion:: $15.5 million backlog, with $2 million in new bookings in the first five weeks of 2026, reflecting strong customer engagement.
  • Gross Margin Decline:: Non-GAAP gross margin dropped to 37.5% (from 54.7%) due to lower sales volume and less favorable product mix.
  • Facility Investment:: $6.3 million spent on manufacturing floor upgrades, increasing capacity by fivefold to support high-power AI test systems.
  • Market Opportunity:: TAM for AI-driven burn-in is 3–5× larger than silicon carbide, with wafer-level burn-in gaining traction for higher yield and cost savings (e.g., 0.5¢/die on 8-inch SiC wafers).

Business Update and Market Trends

The company is experiencing increased interest in its Sonoma high-volume production solution for package level burn-in, and some customers are approaching them to learn about their production wafer level burn-in capabilities. Aehr Test Systems delivered the world's first production wafer level burn-in systems for AI processors, installed at one of the largest OSATs worldwide. The company anticipates follow-on orders from this innovative AI customer as volumes increase. Gayn Erickson emphasized that wafer-level burn-in is a critical step in ensuring the quality of devices, especially for AI processors, and that their FOX XP multi-wafer test and burn-in system is the only production-proven solution for full wafer level test and burn-in of high-powered devices.

Valuation and Growth Prospects

Analysts estimate next year's revenue growth at -2.7%. The company's current valuation metrics include a P/E Ratio of -113.05, P/B Ratio of 6.15, and P/S Ratio of 13.27. The EV/EBITDA ratio is -176.8, indicating a potentially overvalued stock. The company's ROE and ROIC are both negative, at -5.4% and -5.55%, respectively. The Net Debt / EBITDA ratio is 2.88, suggesting a manageable debt level. With the increasing demand for AI processors and the company's strong positioning in the market, the stock may be worth considering for investors.

Risk Factors and Challenges

Gayn Erickson pointed out that companies that don't take burn-in seriously may face issues with device quality and reliability. The industry is also subject to ongoing tariff-related uncertainty, which may impact the company's growth prospects. Aehr Test Systems remains cautious due to these risks and will continue to withhold formal guidance.

3. NewsRoom

Card image cap

Here's Why Aehr Test Systems Stock Slumped in November

Dec -04

Source: fool.com

Card image cap

Aehr Test Systems to Participate in 14th Annual NYC Summit

Dec -03

Source: accessnewswire.com

Card image cap

Baillie Gifford's Recent Transaction with Aehr Test Systems: An In-Depth Analysis

Nov -15

Source: gurufocus.com

Card image cap

Murray Stahl's Strategic Moves: WaterBridge Infrastructure LLC Takes Center Stage

Nov -14

Source: gurufocus.com

Card image cap

Aehr Seeing Momentum in Package-Level Burn-In Alongside Expanding Wafer-Level Burn-in Demand

Nov -12

Source: accessnewswire.com

Card image cap

1 Growth Stock Down 52% to Buy Hand Over Fist Heading Into 2026

Nov -07

Source: fool.com

Card image cap

Aehr Test Systems and ISE Labs Announce Partnership on Wafer-Level Test and Burn-in for High-Performance Computing and Artificial Intelligence Processors

Nov -03

Source: accessnewswire.com

Card image cap

Why I Think This AI Stock Is About to Explode

Oct -13

Source: fool.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.20%)

6. Segments

Wafer-level

Expected Growth: 10.2%

Increasing demand for semiconductor devices, growing adoption of IoT and AI technologies, and the need for efficient testing solutions drive the growth of wafer-level testing market.

Test During Burn-in

Expected Growth: 10.2%

Growing demand for high-reliability semiconductor devices in automotive, industrial, and aerospace applications drives the adoption of TDBI, enabling manufacturers to improve yield and reduce costs.

7. Detailed Products

FOX-XP

Aehr Test Systems' FOX-XP is a highly scalable and configurable test system designed for high-volume production testing of flash and other non-volatile memory devices.

FOX-NP

The FOX-NP is a low-cost, compact test system designed for production testing of flash and other non-volatile memory devices.

FOX-15

The FOX-15 is a highly flexible and configurable test system designed for testing and validation of a wide range of semiconductor devices.

ABTS

Aehr Test Systems' ABTS (Advanced Burn-In and Test System) is a highly scalable and configurable test system designed for burn-in and test of semiconductor devices.

Services

Aehr Test Systems offers a range of services, including test program development, test fixture design and fabrication, and on-site test and support services.

8. Aehr Test Systems's Porter Forces

Forces Ranking

Threat Of Substitutes

Aehr Test Systems has a moderate threat of substitutes due to the availability of alternative testing solutions from competitors.

Bargaining Power Of Customers

Aehr Test Systems has a low bargaining power of customers due to its strong relationships with key customers and limited customer concentration.

Bargaining Power Of Suppliers

Aehr Test Systems has a moderate bargaining power of suppliers due to the availability of multiple suppliers for its components and materials.

Threat Of New Entrants

Aehr Test Systems has a low threat of new entrants due to the high barriers to entry in the semiconductor testing industry.

Intensity Of Rivalry

Aehr Test Systems operates in a highly competitive industry with intense rivalry among established players.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 7.69%
Debt Cost 3.95%
Equity Weight 92.31%
Equity Cost 13.82%
WACC 13.06%
Leverage 8.33%

11. Quality Control: Aehr Test Systems passed 8 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Arteris

A-Score: 4.4/10

Value: 8.2

Growth: 2.1

Quality: 6.6

Yield: 0.0

Momentum: 8.5

Volatility: 1.0

1-Year Total Return ->

View Full Report
Stock-Card
Aehr Test

A-Score: 4.1/10

Value: 6.2

Growth: 3.3

Quality: 4.5

Yield: 0.0

Momentum: 9.5

Volatility: 1.0

1-Year Total Return ->

View Full Report
Stock-Card
AXT

A-Score: 3.9/10

Value: 8.0

Growth: 0.8

Quality: 4.2

Yield: 0.0

Momentum: 9.5

Volatility: 1.0

1-Year Total Return ->

View Full Report
Stock-Card
CEVA

A-Score: 3.6/10

Value: 6.8

Growth: 1.4

Quality: 4.5

Yield: 0.0

Momentum: 6.0

Volatility: 3.0

1-Year Total Return ->

View Full Report
Stock-Card
MaxLinear

A-Score: 3.5/10

Value: 7.2

Growth: 0.6

Quality: 4.7

Yield: 0.0

Momentum: 6.5

Volatility: 2.3

1-Year Total Return ->

View Full Report
Stock-Card
WiSA Technologies

A-Score: 3.4/10

Value: 6.6

Growth: 4.7

Quality: 3.3

Yield: 0.0

Momentum: 5.0

Volatility: 1.0

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

24.74$

Current Price

24.74$

Potential

-0.00%

Expected Cash-Flows