Aehr test system (AEHR 32.08%) Shares soared 32.1% on Friday. That comes after the supplier of semiconductor test and reliability qualification equipment released a report in the afternoon that beats his expectations for the second quarter of fiscal year 2023.
Both sales and earnings easily exceeded Wall Street consensus expectations, and management reiterated its guidance for the full year.
Investors are enthusiastic about Aehr’s potential for long-term tailwinds from the electric vehicle (EV) revolution. The company is seeing increased demand for its equipment from manufacturers of silicon carbide semiconductors, which are increasingly used in EVs.
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Aehr Test Systems key number
| metric | Q2 2022 | Q2 FY2023 | Change |
|---|---|---|---|
| Earnings | $9.6 million | $14.8 million | 54% |
| GAAP net income | $717,000 | $3.7 million | 416% |
| Adjusted net income | $1.4 million | $4.5 million | 221% |
| GAAP earnings per share (EPS) | $0.03 | $0.13 | 333% |
| Adjusted EPS | $0.05 | $0.16 | 220% |
Data source: Aehr test system. GAAP = generally accepted accounting principles. The second quarter of fiscal year 2023 he ended on November 30, 2022.
Investors should focus on adjusted figures that exclude one-off items.
Wall Street was looking for an adjusted EPS of $0.08 on $12.8 million in earnings. So Yale met both expectations.
The company had $10.8 million in orders during the quarter. We ended the period with a backlog of $15.5 million. That backlog stood at $23.5 million for him on earnings day.
Aehr ended the quarter with cash and cash equivalents of $36.6 million. Light debt burden.
What the CEO had to say
CEO Gayn Erickson’s statement in the earnings release was once again quite lengthy.
We had a very strong quarter, with sales and net income exceeding consensus expectations and strong growth quarter-over-quarter and year-over-year. Silicon carbide wafer level burn-in continues to gain momentum. This momentum will continue over the next few years, especially as companies add significant production capacity to silicon carbide semiconductors to meet the incredible demand projected in the market for electric vehicles and electric vehicle chargers. is expected to continue. […]
We are very optimistic about our strong outlook for the second half of this fiscal year and believe the momentum will continue into fiscal 2024.
Full-year guidance repeats
For fiscal year 2023, which ends May 31, management reiterated its expectation of revenue of $60 million to $70 million.
Management also said it expects strong profit margins similar to last year.
Growth Investors: Add this stock to your watchlist
I’ll repeat what I wrote in October after the company announced its first quarter results.
That said, due to Aehr’s small size and very early stage of interest in the EV market, its stock is only suitable for investors accustomed to higher risk and volatility.
Beth McKenna has no positions in any of the stocks mentioned. The Motley Fool has no positions in any of the companies mentioned. The Motley Fool’s U.S. headquarters has a disclosure policy.
