Aehr Test Systems secures AI chip testing orders

FREMONT, CA - Aehr Test Systems (NASDAQ:AEHR), a global provider of semiconductor test equipment, announced today it has received orders for its Sonoma ultra-high-power system from a major data center operator. The systems are designed for volume production testing and burn-in of AI processors, a growing sector in the semiconductor industry.

The order, placed by an unnamed large-scale data center hyperscaler, includes six Sonoma systems. These systems are equipped for testing ultra-high-power AI devices and feature turnkey application-specific burn-in modules with active liquid-based conductive temperature control for each device. The systems are scheduled to ship from Aehr's Fremont production facility over the coming six months.

Gayn Erickson, President and CEO of Aehr Test Systems, expressed excitement about the new volume production orders and highlighted the Sonoma system as part of a new product line developed for AI accelerators and high-performance computing processors. Erickson credited the acquisition of Incal Technology for expanding Aehr's capabilities and market position, especially in the AI semiconductor market.

Alberto Salamone, former CEO of Incal and now Executive Vice President at Aehr, praised the Sonoma system's design tailored to the AI market's production burn-in needs. Salamone emphasized the system's efficiency and full traceability features as critical for production environments.

The Sonoma system boasts advanced testing features, including 3200 watts of electrical power per Distribution Tray, active liquid cooling, and thermal control for up to four devices per tray. It also offers up to 22 independent power Distribution Trays for Burn-In-Module mounting, allowing for substantial testing and burn-in capabilities at a reduced footprint.

Aehr Test Systems is known for its test solutions across various semiconductor applications, including electric vehicles, renewable energy, and data infrastructure. The company's acquisition of Incal Technology has positioned it to better serve the AI semiconductor market with enhanced research and development, technological innovation, and manufacturing capabilities.

This press release contains forward-looking statements regarding Aehr's future performance and market growth. These statements are based on current expectations and are subject to risks and uncertainties.

The information in this article is based on a press release statement.

In other recent news, Aehr Test Systems has finalized the acquisition of Incal Technology, purchasing all outstanding capital stock of Incal for a total consideration of $21 million. This strategic merger is expected to enhance Aehr Test Systems' product offerings and market reach in the semiconductor industry. On the financial front, Aehr Test Systems reported robust fiscal 2024 earnings, with a fourth-quarter revenue of approximately $16.6 million and a GAAP net income of about $23.8 million. For the full fiscal year, Aehr's revenues were around $66.2 million, and the GAAP net income was nearly $33.1 million, surpassing both previous company guidance and analyst consensus. Recent developments also include an upgrade of Aehr Test Systems' stock from Hold to Buy by Craig-Hallum, reflecting a positive outlook on the company's potential for growth. Looking ahead, Aehr Test Systems is targeting a minimum of $70 million in total revenue for fiscal year 2025, including contributions from Incal Technology. The company also highlighted its strong cash position, with $47.9 million in short-term investments and no debt. These recent events underscore Aehr Test Systems' ongoing commitment to growth and expansion in the semiconductor industry.

InvestingPro Insights

As Aehr Test Systems (NASDAQ:AEHR) secures a significant order from a major data center operator, it's important to consider the company's current financial health and market performance. According to recent data from InvestingPro, Aehr holds a market capitalization of approximately $387.53 million and is trading with a P/E ratio of 11.44 as of the last twelve months ending in Q4 2023. This valuation metric is slightly above the adjusted P/E ratio for the same period, which stands at 11.69. The company's commitment to innovation and market expansion, as evidenced by its new Sonoma system, may be reflected in these figures.

InvestingPro Tips highlight that Aehr's stock has experienced significant volatility, with a notable decline over the past week, month, and year. Despite these fluctuations, the company's balance sheet shows a positive sign, holding more cash than debt, which could provide a buffer against short-term market shifts. Moreover, Aehr's liquid assets exceed its short-term obligations, indicating a level of financial resilience.

It's also worth noting that while Aehr's net income is expected to drop this year, analysts predict the company will maintain profitability. This aligns with the company's recent announcement of new orders and its strategic acquisition aimed at bolstering its position in the AI semiconductor market. For investors seeking a deeper analysis of Aehr's performance and future prospects, InvestingPro offers additional insights, including 13 more InvestingPro Tips, available on their platform.

With the next earnings date set for October 3, 2024, stakeholders will be keen to see how the recent business developments impact Aehr's financial outcomes and whether the company can leverage its technological advancements in the AI semiconductor space to fuel growth and investor confidence.

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