News: Suppliers
16 October 2024
Aehr’s quarterly revenue falls by 36% year-on-year, but EV-related orders rebounding
For its fiscal first-quarter 2025 (to 30 August 2024), semiconductor production test and reliability qualification equipment supplier Aehr Test Systems of Fremont, CA, USA has reported revenue of $13.1m, down 21% on $16.6m last quarter and 36% on $20.6m a year ago.
WaferPak has risen from 55% of total revenue a year ago to 92% ($12.1m). “Our customers continue to utilize the available installed base of FOX-XP systems for new customer design wins, and purchase additional new WaferPaks from Aehr to test and burn-in these new devices,” notes chief financial officer Chris Siu.
Due mainly to the favorable product mix of higher-margin WaferPaks, gross margin (on a non-GAAP basis) has risen from 48.7% a year ago to 54.7%.
Operating expenses were $5.52m, roughly flat on $5.41m a year ago. Operating income has fallen further, from $4.64m a year ago and $3.42m last quarter to $1.65m. Net income was $2.15m ($0.07 per diluted share), down from $5.2m ($0.18 per diluted share) a year ago.
Operating cash flow was $2.4m. However, total cash, cash equivalents and restricted cash fell during the quarter from $49.3m to $40.8m, reflecting $10.6m in net cash paid to acquire Fremont-based Incal Technology Inc. Aehr has no debt and continues to invest excess cash in money market funds.
Orders rebound as demand stabilizes for SiC power semi market
Order bookings have rebounded from a low of just $4m last quarter to $16.8m. Order backlog has hence recovered from $7.3m to $16.6m.
“Silicon carbide wafer-level burn-in test systems and full-wafer contactors are poised to be key contributors to revenue again this year,” says president & CEO Gayn Erickson. “We are also forecasting material bookings and revenue contributions from several other markets this fiscal year, as we are successfully executing on our strategy to expand our test and burn-in products into other large and fast-growing markets such as artificial intelligence processors, gallium nitride power semiconductors, hard disk drive components and flash memory devices,” he adds.
“We have been seeing a stabilization and increasingly positive discussions within the silicon carbide power semiconductor market over the past quarter. Electric vehicle (EV) suppliers are clearly moving towards silicon carbide in integrated modules, combining silicon carbide MOSFETs into single packages to meet the industry's power, efficiency and cost-effectiveness demands. Due to the need for extensive test and burn-in of these devices to ensure reliability for mission-critical applications like EVs, the benefits of conducting this screening at the wafer-level before integrating them into modules, which may sometimes contain 32 or more other devices [in a three-phase inverter module], are becoming clear. The process improves yields and reduces costs, driving demand for wafer-level burn-in. We are highly optimistic about our silicon carbide business and expect it to gain momentum over the next few quarters. Our silicon carbide customers are forecasting capacity expansion needs in calendar 2025, with several anticipating purchases of one or two systems in early 2025, followed by production volumes in the second half of the year, and ramping further into 2026,” Erickson states.
“Meanwhile, we continue to see strong demand for our FOX WaferPak full-wafer Contactors for silicon carbide and other markets for our installed base of FOX-XP and FOX-NP wafer-level test and burn-in systems, driven by a record number of new device designs started this past quarter. These designs are expected to lead to additional WaferPak purchases for engineering qualification as well to volume production orders as they advance to production.”
“We are also making steady progress on our previously announced benchmarks and engagements with new silicon carbide device and module suppliers. We are confident that we will add several new silicon carbide customers this year, establishing our solution as their tool of record for volume production. Additionally, silicon carbide is gaining traction in applications beyond electric vehicles, such as solar, industrial and data centers, which will expand our addressable markets.”
“We are now in negotiations with our first gallium nitride (GaN) semiconductor customer for volume production wafer-level test and burn-in of their devices. This past year, this customer purchased a significant number of WaferPaks to successfully qualify a wide range of GaN device types aimed at multiple markets, including consumer, industrial and automotive. In addition, we have had increased discussions and engagements with multiple potential new GaN suppliers. We believe GaN is a significant up-and-coming technology for power semiconductors. With a forecasted CAGR of more than 40% to over $2bn in GaN devices sold annually by 2029, it has the potential to be a significant market opportunity for Aehr’s wafer-level solutions.”
“Last quarter, we announced that an artificial intelligence (AI) accelerator company committed to evaluating our FOX solution for wafer-level burn-in of their high-power processors. This evaluation is underway at our Fremont facility, where multiple wafers are being tested using our proprietary WaferPaks and new high-power FOX-XP and NP systems, which provide up to 3500W of power delivery and thermal control per wafer. We are delivering over 2000A of current to a single 300mm wafer, allowing us to burn-in numerous processors with our proprietary test modes. The evaluation is progressing very well and, once we demonstrate successful wafer-level test results and throughput, we anticipate they will adopt our high-power FOX-XP systems for production of their next-generation AI processors, beginning this fiscal year.”
Incal’s packaged-part reliability burn-in and test opens up AI semiconductor market
On 31 July, Aehr completed its acquisition of Incal Technology Inc, expanding its product portfolio to include packaged-part reliability burn-in and test solutions, particularly ultra-high-power capabilities for AI processors, GPUs, and high-performance computing processors. “These advanced high-power capabilities, combined with Aehr’s industry-leading lineup of wafer-level test and reliability solutions, position us strongly to capitalize on the significant and rapidly growing opportunities in the AI semiconductor market,” believes Erickson. “This acquisition greatly expands our addressable market, enabling us to provide a comprehensive turnkey solution for reliability and testing from engineering to high-volume production, to the rapidly growing AI semiconductor market,” he adds.
“Customer feedback to this acquisition has been overwhelmingly positive, with several meetings held over the past few weeks where some customers indicated increased forecasts for engineering qualification as well as for volume production. Last month, we were pleased to announce the first volume production orders for Incal’s new Sonoma ultra-high-power semiconductor packaged-part test and burn-in solution designed for AI accelerators, graphics processors, network processors, and high-performance computing processors. These orders were placed by a large-scale data-center hyperscaler that provides computing power and storage capacity to millions of users worldwide.”
Aehr has already shipped several systems since the acquisition, and plans to consolidate personnel and manufacturing into its Fremont facility by the end of the fiscal year. The firm is upgrading and re-modeling its Fremont headquarters this year, ensuring its facility infrastructure meets the needs of both companies.
Full-year guidance reiterated
“With all of these customer engagements, market opportunities, and the products to address them, we are very optimistic about the year ahead, and we are reaffirming our financial guidance for revenue growth and profitability for the year,” notes Erickson.
For its fiscal full-year 2025 (ending 30 May), Aehr is reiterating its existing guidance for revenue growth to at least $70m (up on fiscal 2024’s record $66.2m), with net profit before taxes of at least 10% of revenue.
Aehr expects about 85% of forecasted annual revenue to come from wafer-level burn-in and 15% from packaged-part burn-in, driven by its acquisition of Incal.
Aehr’s quarterly revenue rebounds from dip, enabling full-year growth
