GlobeNewswire Inc | Jan 6, 2022 04:05PM EST

January 06, 2022

FREMONT, Calif., Jan. 06, 2022 (GLOBE NEWSWIRE) -- Aehr Test Systems (NASDAQ: AEHR), a worldwide supplier of semiconductor test and reliability qualification equipment, today announced financial results for its second quarter of fiscal 2022 ended November 30, 2021.

Fiscal Second Quarter Financial Results:

-- Net sales were $9.6 million, up 471% from $1.7 million in the second quarter of fiscal 2021. -- GAAP net income was $717,000, or $0.03 per diluted share, compared to a GAAP net loss of $2.0 million, or $0.08 per diluted share, in the second quarter of fiscal 2021. -- Non-GAAP net income was $1.4 million, or $0.05 per diluted share, which excludes the impact of stock-based compensation, compared to a non-GAAP net loss of $1.7 million, or $0.07 per diluted share, in the second quarter of fiscal 2021. -- Bookings were $29.1 million for the quarter ended November 30, 2021, the Companys quarterly highest bookings on record, compared to $1.6 million in the second quarter of fiscal 2021. -- Backlog as of November 30, 2021 was $36.1 million, the Companys highest backlog on record.

Fiscal First Six Months Financial Results:

-- Net sales were $15.3 million, up 313% from $3.7 million in the first six months of fiscal 2021. -- GAAP net income was $1.4 million, or $0.05 per diluted share, which includes the impact of forgiveness of $1.7 million in loans from the Paycheck Protection Program (PPP) received in fiscal 2020. This compares to a GAAP net loss of $1.9 million, or $0.08 per diluted share, in the first six months of fiscal 2021, which includes the impact of stock-based compensation and a non-cash net gain of $2.2 million and tax benefit of $215,000 related to the closure of Aehrs Japan subsidiary during the first quarter of fiscal 2021. -- Non-GAAP net income was $1.0 million, or $0.04 per diluted share, which excludes the impact of stock-based compensation and forgiveness of the PPP loan. This compares to a non-GAAP net loss of $3.7 million, or $0.16 per diluted share, in the first six months of fiscal 2021, which excludes the impact of stock-based compensation and the net gain related to the closure of Aehrs Japan subsidiary during the first quarter of fiscal 2021.

An explanation of the use of non-GAAP financial measures and a reconciliation of Aehrs non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in the accompanying tables.

Gayn Erickson, President and CEO ofAehr Test Systems, commented:

We finished the second quarter with record bookings for a single quarter of $29.1 million and our highest backlog on record of $36.1 million. Including the announced orders since the beginning of the fiscal third quarter, our total bookings for the fiscal year to date is over $52 million.

We continue to see very strong interest and demand for wafer level test and burn-in of silicon carbide devices, particularly for use directly in, and in support of, the electric vehicle market. We are ramping our FOXmulti-wafer test and burn-in systems and full wafer WaferPakcapacity to meet this upcoming silicon carbide market opportunity, which we believe will grow significantly over the next decade or more. We are only at the very beginning of this ramp as electric vehicles accounted for a very small percentage share of the overall market last year and are expected to be over 30% of total vehicles sold by 2030.

During the quarter we received a $19.4 million order for our FOX-XPwafer level test and burn-in systems from our lead silicon carbide customer. This order was then followed by a $7.6 million order for WaferPaks that do not fully populate the systems, so we are expecting additional follow on WaferPak orders for these production FOX-XP systems. These systems and WaferPaks are being used to test and burn-in MOSFET devices in traction inverters in electric vehicle motor controllers, as well as both on-board and off-board electric vehicle chargers. This customer, a major automotive semiconductor supplier with a significant customer base in the automotive semiconductor market, continues to forecast significant additional system and WaferPak purchases over the next several years. Multiple industry forecasters and analysts expect the market for silicon carbide devices to grow at a compound annual growth rate (CAGR) of more than 30% over the next decade driven by demand from the electric vehicle market and other applications.

In addition to a very strong backlog and forecast from our lead silicon carbide customer, we are currently engaged in discussions and/or evaluations with several other silicon carbide suppliers regarding their wafer level test and burn-in needs. This includes at least one large silicon carbide supplier that has moved to on-wafer evaluation and benchmarking of Aehrs FOX-XP multi-wafer system for testing and burning in their silicon carbide wafers. We believe we will add several new silicon carbide customers that will ramp into production by next fiscal year on our solutions.

Another positive is that we continue to see signs of strengthening in the silicon photonics test and burn-in market as our FOX multi-wafer systems and WaferPaks provide a very cost effective and scalable solution for burning in the optical lasers and stabilizing their output power while also removing any extrinsic or early life failures. In addition to the silicon photonics devices that are now ramping into production for fiberoptic transceivers for datacom and telecom applications such as data center and 5G infrastructure, several companies have made public announcements of their intent to integrate silicon photonics devices and co-packaged optics in high end processor applications and intra-chip as well as inter-chip communications within the next few years.

During the last few months, we received orders from a current silicon photonics customer for six additional FOX-NP systems to support the characterization and product qualification of new types of photonics-based devices. This customer is expected to purchase new sets of WaferPaks to be used with these systems. As the applications and market for silicon photonics-based devices continue to grow, we expect this customer to continue to increase their capacity in the future.

Several other customers addressing the silicon photonics market have also forecast additional FOX system and WaferPak or DiePak contactor capacity needs over the next 12 months. These include needs to address incremental production capacity as well as capacity to address new customer and new product qualification and engineering. Silicon photonics devices address the 5G and data center infrastructure industry as well as several other key markets today, and Yole Research predicts that the silicon photonics transceiver market alone will reach $4.6 billion in 2026, with a CAGR of 25% between 2021 and 2026.

We remain very focused on serving the very large market opportunities we see ahead, which include the significant opportunity for test and burn-in of silicon carbide devices for electric vehicles and electrification infrastructure, silicon photonics devices for data center and 5G infrastructure, and 2D/3D sensors for mobile and wearable devices. With our record bookings and the strength of our semiconductor test and burn-in solutions, we are confident in our ability to deliver significant revenue growth and are reiterating our guidance for revenue for the year.

Fiscal 2022 Financial Guidance:

For the fiscal year ending May 31, 2022, Aehr is reiterating its previously provided guidance for full year total revenue of at least $50 million, and to be profitable for the fiscal year at these revenue levels based upon its operating model.

Management Conference Call and Webcast

Aehr Test Systems will host a conference call and webcast today at 5:00 p.m. Eastern (2:00 p.m. PT) to discuss its fiscal 2022 second quarter operating results. To access the live call, dial 800-437-2398 (US and Canada) or +1 929-477-0577 (International) and give the participant passcode 5907605. In addition, a live and archived webcast of the conference call will be available over the Internet at www.aehr.com in the Investor Relations section and at the following link https://edge.media-server.com/mmc/p/ewc7mhgg. A replay of the conference call will also be available via telephone beginning approximately two hours after conclusion of the call through 8:00 p.m. ET on January 13, 2022. To access the replay dial-in information, please click here.

About Aehr Test Systems

Headquartered in Fremont, California, Aehr Test Systems is a worldwide provider of test systems for burning-in and testing logic, optical and memory integrated circuits and has installed over 2,500 systems worldwide. Increased quality and reliability needs of the Automotive and Mobility integrated circuit markets are driving additional test requirements, incremental capacity needs, and new opportunities for Aehr Test products in package, wafer level, and singulated die/module level test. Aehr Test has developed and introduced several innovative products, including the ABTSand FOX-Pfamilies of test and burn-in systems and FOX WaferPakAligner, 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 both lower power and higher power logic devices as well as all common types of memory devices. The FOX-XP and FOX-NP systems are full wafer contact and singulated die/module test and burn-in systems used for burn-in and functional test of complex devices, such as leading-edge memories, digital signal processors, microprocessors, microcontrollers, systems-on-a-chip, and integrated optical devices. The FOX-CP system is a new low-cost single-wafer compact test and reliability verification solution for logic, memory and photonic devices and the newest addition to the FOX-P product family. 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 cost-effective final test and burn-in of both bare die and modules. For more information, please visit Aehr Test Systems website at www.aehr.com.

Safe Harbor Statement

This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements generally relate to future events or Aehrs future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as "may," "will," "should," "expects," "plans," "anticipates, going to, "could," "intends," "target," "projects," "contemplates," "believes," "estimates," "predicts," "potential," sees, or "continue," or the negative of these words or other similar terms or expressions that concern Aehrs expectations, strategy, priorities, plans, or intentions. Forward-looking statements in this press release include, but are not limited to, Aehrs ability to generate bookings and revenue increases in the future, including the first quarter of fiscal 2022; future requirements and orders of Aehrs new and existing customers; bookings forecasted for proprietary WaferPakand DiePak consumables across multiple market segments; the temporary nature of customer pushouts; shipping timelines for products and follow-on capacity orders; the growth of Aehrs systems and consumables, including as a percentage of total sales; financial guidance for fiscal 2022, including related to revenue and profitability, and expectations regarding fiscal 2022; Aehrs ability to expand its number of customers using its FOX-Psolutions; the ability to secure potential customer engagements; expectations related to long-term demand for Aehrs productions and the attractiveness of key markets; the belief that Aehr will be stronger after the current worldwide COVID-19 pandemic, including expectations related to greater production, more customers, more applications, and higher value products. The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in Aehrs recent 10-K, 10-Q and other reports filed from time to time with the Securities and Exchange Commission. Aehr disclaims any obligation to update information contained in any forward-looking statement to reflect events or circumstances occurring after the date of this press release.

- Financial Tables to Follow

AEHR TEST SYSTEMS AND SUBSIDIARIESCondensed Consolidated Statements of Operations(in thousands, except per share data)(unaudited) Three Months Ended Six Months Ended Nov 30, Aug 31, Nov 30, Nov 30, Nov 30, 2021 2021 2020 2021 2020 Net sales $ 9,611 $ 5,646 $ 1,683 $ 15,257 $ 3,695 Cost of sales 5,092 3,365 1,306 8,457 3,091 Gross profit 4,519 2,281 377 6,800 604 Operating expenses:Selling,general and 2,489 1,953 1,501 4,442 3,015 administrativeResearch and 1,313 1,321 820 2,634 1,720 developmentTotaloperating 3,802 3,274 2,321 7,076 4,735 expenses Income (loss)from 717 (993 ) (1,944 ) (276 ) (4,131 )operations Interest (1 ) (9 ) (12 ) (10 ) (25 )expense, netIncome fromforgiveness of - 1,698 - 1,698 - PPP loanNet gain fromdissolution of - - - - 2,186 Aehr TestSystems JapanOther income 35 23 (6 ) 58 (100 )(expense), net Income(loss)before 751 719 (1,962 ) 1,470 (2,070 )income tax(expense)benefit Income tax(expense) (34 ) (23 ) (4 ) (57 ) 211 benefit Net income $ 717 $ 696 $ (1,966 ) $ 1,413 $ (1,859 )(loss) Net income(loss) per shareBasic $ 0.03 $ 0.03 $ (0.08 ) $ 0.06 $ (0.08 )Diluted $ 0.03 $ 0.03 $ (0.08 ) $ 0.05 $ (0.08 ) Shares used inper share calculations:Basic 26,205 23,999 23,396 25,102 23,322 Diluted 28,342 25,356 23,396 26,849 23,322

AEHR TEST SYSTEMS AND SUBSIDIARIESReconciliation of GAAP and Non-GAAP Results(in thousands, except per share data)(unaudited) Three Months Ended Six Months Ended Nov 30, Aug 31, Nov 30, Nov 30, Nov 30, 2021 2021 2020 2021 2020 GAAP net income $ 717 $ 696 $ (1,966 ) $ 1,413 $ (1,859 )(loss)Stock-basedcompensation 718 588 257 1,306 527 expenseIncome fromforgiveness of PPP - (1,698 ) - (1,698 ) - loanIncome fromdisolution of - - - - (2,401 )Aehr TestSystesm JapanNon-GAAP net $ 1,435 $ (414 ) $ (1,709 ) $ 1,021 $ (3,733 )income (loss) GAAP net income(loss) per diluted $ 0.03 $ 0.03 $ (0.08 ) $ 0.05 $ (0.08 )shareNon-GAAP netincome (loss) per $ 0.05 $ (0.02 ) $ (0.07 ) $ 0.04 $ (0.16 )diluted shareShares used inGAAP diluted 28,342 25,356 23,396 26,849 23,322 shares calculationShares used innon-GAAP diluted 28,342 23,999 23,396 26,849 23,322 sharescalculation Non-GAAP net income (loss) is a non-GAAP measure and should not be considered areplacement for GAAP results. Non-GAAP net income (loss) is a financial measurethe Company uses to evaluate the underlying results and operating performanceof the business. The limitation of this measure is that it excludes items thatimpact the Company's current period net income. This limitation is bestaddressed by using this measure in combination with net income (loss) (the mostdirectly comparable GAAP financial measure). These measures are not inaccordance with GAAP and may differ from non-GAAP methods of accounting andreporting used by other companies.

We believe these measures enhance investors? ability to review the company?sbusiness from the same perspective as the Company?s management and facilitatecomparisons of this period?s results with prior periods.



AEHR TEST SYSTEMS AND SUBSIDIARIES Condensed Consolidated Balance Sheets (in thousands, except per share data) (unaudited) November 30, August 31, May 31, 2021 2021 2021 ASSETS Current assets: Cash and cash equivalents $ 35,031 $ 6,530 $ 4,582 Accounts receivable, net 7,391 4,264 5,202 Inventories 13,033 10,146 8,849 Prepaid expenses and other 622 759 551 Total current assets 56,077 21,699 19,184 Property and equipment, net 661 676 677 Operating lease right-of-use 1,265 1,437 1,606 assetsOther assets 182 189 198 Total assets $ 58,185 $ 24,001 $ 21,665 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 3,386 $ 2,753 $ 2,893 Accrued expenses 2,254 1,978 2,163 Operating lease liabilities, 763 750 737 short-termCustomer deposits anddeferred revenue, 10,142 3,279 189 short-termLine of credit - - 1,400 Current portion of long-term - - 1,679 debtTotal current liabilities 16,545 8,760 9,061 Operating lease liabilities, 616 813 1,007 long-termLong-term debt, net of current - - - portionDeferred revenue, long-term 116 150 99 Other liabilities 46 46 49 Total liabilities 17,323 9,769 10,216 Total shareholders' equity 40,862 14,232 11,449 Total liabilities and $ 58,185 $ 24,001 $ 21,665 shareholders' equity

Contacts: Aehr Test Systems MKR Investor Relations Inc.Ken Spink Todd Kehrli or Jim ByersChief Financial Officer Analyst/Investor Contact(510) 623-9400 x309 (323) 468-2300 aehr@mkr-group.com