Aehr Test Systems (AEHR) AI Stock Analysis

• Market Cap: $580.05M
• Dividend Yield: N/A
• Average Volume (3M): 1.74M
• Price to Earnings (P/E): 19.5
• Beta (1Y): 1.74
• Revenue Growth: -10.95%
• EPS Growth: -111.40%
• Country: US
• Employees: 115
• Sector: Technology
• Sector Strength: 80
• Industry: Semiconductors
• EPS (TTM): -0.01
• Shares Outstanding: 29,915,062
• 10 Day Avg. Volume: 991,117
• 30 Day Avg. Volume: 1,739,759
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.47
• Enterprise Value/Revenue: 4.58
• Enterprise Value/Gross Profit: 11.29
• Enterprise Value/Ebitda: -64.28
• 1Y Price Target: $19.00
• Price Target Upside: 9.32% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 58 Neutral
• Price Target: $19.00 ▲(9.32% Upside)

Aehr Test Systems faces financial challenges with declining revenue and profitability, impacting its overall score. However, positive technical indicators and strategic diversification into AI processors provide some optimism. Valuation remains a concern due to negative earnings, but the earnings call suggests potential for future growth in new markets.

Positive Factors

Acquisition and Expansion

The acquisition of Incal Technology will expand Aehr’s product portfolio, representing a growth opportunity in AI accelerators, GPUs, and high-performance computing processors.

Technological Innovation

The company announced the first adoption of its wafer level burn-in (WLBI) for an AI processor, offering a significant value proposition for AI processor manufacturers.

Negative Factors

Earnings and Financial Guidance

Aehr missed fourth-quarter expectations considerably and held back on providing guidance for fiscal 2026.

Market Visibility

Bookings in the quarter were $11.1 million, representing a book-to-bill ratio of 0.79, highlighting the lack of visibility in the business as new markets are still being evaluated.

Aehr Test Systems Business Overview & Revenue Model

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.

How the Company Makes Money

Aehr Test Systems generates revenue primarily through the sale of its test and burn-in equipment, which includes both hardware and software components. The company also earns money from ongoing service contracts, maintenance, and support for its installed systems. Key revenue streams include direct sales to semiconductor manufacturers and fabless companies, as well as partnerships with original equipment manufacturers (OEMs) that integrate AEHR's technology into their products. Additionally, AEHR benefits from increasing demand for its solutions due to the growing complexity of semiconductor devices and the need for rigorous testing to ensure reliability, especially in automotive and high-performance computing applications.

Aehr Test Systems Financial Statement Overview

Summary

Aehr Test Systems is facing a challenging financial environment with declining revenue and profitability, coupled with cash flow difficulties. While the balance sheet remains strong, with a significant equity buffer, operational inefficiencies and negative cash flows raise concerns. Addressing these challenges is critical for future financial health and growth prospects.

Income Statement

The company's revenue has shown inconsistent growth with a recent decline in total revenue from $66.2M to $58.97M. The gross profit margin decreased from 49.1% to 40.6%, indicating reduced efficiency in production. The net profit margin turned negative at -6.6%, compared to the previous year's 50%, reflecting significant profitability challenges. The EBIT and EBITDA margins also turned negative, highlighting operational inefficiencies.

Balance Sheet

Aehr Test Systems maintains a solid equity base with an equity ratio of 82.7%. However, the debt-to-equity ratio increased slightly due to rising debt levels, though it remains manageable. The return on equity turned negative, indicating recent profitability issues. The company has a strong cash position, supporting financial stability despite recent losses.

Cash Flow

The cash flow situation is concerning, with both operating and free cash flows turning negative. This indicates challenges in generating cash from operations, reflected in a negative free cash flow growth rate of -1,336%. The operating cash flow to net income ratio is negative, further underscoring cash generation issues.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	58.97M	58.97M	66.22M	64.96M	50.83M	16.60M
Gross Profit	23.93M	23.93M	32.54M	32.75M	23.66M	6.03M
EBITDA	-4.20M	-5.68M	11.44M	13.82M	7.80M	-3.85M
Net Income	-3.91M	-3.91M	33.16M	14.56M	9.45M	-2.03M
Balance Sheet
Total Assets	148.51M	148.51M	127.91M	98.14M	62.33M	21.66M
Cash, Cash Equivalents and Short-Term Investments	24.53M	24.53M	49.16M	47.91M	31.48M	4.58M
Total Debt	10.83M	10.83M	6.20M	6.30M	1.01M	4.82M
Total Liabilities	25.64M	25.64M	16.32M	22.54M	11.34M	10.22M
Stockholders Equity	122.87M	122.87M	111.59M	75.60M	50.99M	11.45M
Cash Flow
Free Cash Flow	-12.39M	-12.39M	1.01M	8.65M	1.09M	-2.93M
Operating Cash Flow	-7.40M	-7.40M	1.76M	10.01M	1.51M	-2.70M
Investing Cash Flow	-16.07M	-16.07M	17.25M	-18.66M	-416.00K	-227.00K
Financing Cash Flow	625.00K	625.00K	139.00K	7.32M	25.76M	1.96M

Aehr Test Systems Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 17.38
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AEHR, the sentiment is Positive. The current price of 17.38 is below the 20-day moving average (MA) of 18.78, above the 50-day MA of 15.81, and above the 200-day MA of 12.07, indicating a neutral trend. The MACD of 0.62 indicates Positive momentum. The RSI at 48.77 is Neutral, neither overbought nor oversold. The STOCH value of 32.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AEHR.

Aehr Test Systems Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NVEC	71 Outperform	$310.93M	21.39	23.09%	6.22%	-9.22%	-13.57%
Sector *	62 Neutral	£509.23M	27.17	-2.10%	2.79%	3.87%	-14.52%
AEHR	58 Neutral	$580.05M	19.55	-3.34%	―	-10.95%	-111.40%
NVTS	50 Neutral	$1.44B	―	-32.05%	―	-25.65%	-130.95%
VLN	49 Neutral	$215.67M	―	-24.56%	―	8.70%	-13.95%
AIP	47 Neutral	$406.03M	―	-1369.57%	―	18.64%	16.54%
XPER	47 Neutral	$285.43M	―	-0.92%	―	-6.09%	97.33%