Aehr Test Systems (AEHR) 30 Mar 232023 Q3 Earnings call transcript

Hello. And welcome to the Aehr Test Systems Fiscal 2023 Third Quarter Financial Results Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions]

is event this note being recorded. Please now Jim Byers would like to to over conference the of turn I MKR Relations. Investor ahead. go Please

Thank Executive financial Spink. And third afternoon. are Officer, Aehr me you, Ken Aehr President call Erickson; Operator. Systems and and Systems’ Test Financial Chief on welcome today’s quarter Gayn conference results to XXXX Test call. Officer, With fiscal Good Chief

will Gayn afternoon available and on few Before after Ken, Investor like Relations archived XXXX over I turn of is Test the a This This the results. live on to the release at aehr.com. third page over company’s Aehr call webcast is Internet quick close, to for release parties items. be press announcing right company’s call market cover That being interested broadcast a quarter the I’d the also issued all website. its fiscal website the and

will that estimates, I’d forward-looking the and everyone and cause in of like to that to are information differ statements statements. risks remind call, subject on to that from a materially be based current actual could uncertainties today forward-looking those number making are on and management results today’s

results cause factors that from the the those in statements differ These may are most periodic to with and SEC. filed the materially recent forward-looking company’s in discussed current reports

Aehr undertakes during guidance Systems provided of are and statements. only date call the including today’s statements, forward-looking These obligation Test to forward-looking as this no update valid

with to call CEO. over Gayn that, Erickson, turn and now, I’d the And President to like

Appreciate quarter you third to call. afternoon, guys earnings Thanks, everyone. today. Jim. Good welcome XXXX our And joining us fiscal

over semiconductor open to and we in the the are Then will highlights questions. with go and take then the start summary the a up test continued financials in momentum the detail. Let’s after we your level market, more will quarter that, burn-in the Ken seeing of quick wafer of lines

income and $XX.X net at of for estimates. finished revenue of quarter of QX, million backlog We the record great strong Aehr had ahead in the million of quarter a with end and quarter. quarter another bookings single the $XX.X with consensus a

Our of Xst, quarter received million. the fourth quarter since are all beginning March the or the which backlog, since the effective $XX end includes orders of

total fiscal is $XX.X Our million. already bookings the for year-to-date

Let momentum me capacity the carbide silicon a start Companies wafer market electric are for vehicle for electric are increasing significant demand, its carbide. for the level are electric infrastructure we and forecasted and with in rate. in to semiconductors The seeing tremendous silicon silicon vehicle supporting test carbide and the vehicles markets. growing incredible adding particularly charger at address burn-in requirements

silicon Blair equivalent silicon inverters X.X more from than traction market EVs of for rate to X-inch that electric equivalent X-inch to and vehicles for growth grow XXXX million XXXX. annual carbide representing such in wafers almost XXXX expected from Forecast to XX.X%. wafers carbide equates the times in larger in XXX,XXX alone, onboard compound William XX XXXX, as than is in a in chargers devices estimate This

grow markets market expected carbide silicon expands least other and market solar, for such are Also, other test testing wafers X-inch equivalent as and -- electrification This more. our to million silicon X infrastructure to XXXX. by carbide burn-in industrial wafers another at even

burn-in and major device engineering initial burn-in other an During be systems to dual for purchasing for used customer FOX-XP carbide first and moved silicon system the FOX-NP test second from used semiconductor to and of production wafers. quarter, qualification carbide ours, our their silicon test wafer

be which week, used this a full in Last from quarter customer systems WaferPak this order of these Contactors, shipping will to announced for with follow-on production. we quantities our production begin wafer

large as the serves plant and customer this other growth increase of end number industry, over FOX-XP well and electric our significant several the capacity to publicly meet announced purchase as in markets, a the the including who vehicle decade. next to revenue years systems will significant several believe industrial We applications of

These enabling wafer. between reverse industry, as and our devices in devices electrical HTRB testing or new patented on which option, the to streets channel silicon include is arching using of capability high-temperature arching include high high anti- WaferPak known it’s module voltage bias the our systems devices carbide necessary the very Contactors, that voltage between proprietary avoid or

systems This now. wafer will new are were which challenge WaferPak we and integrated fully and fiscal right our a also solves with high-voltage test level quarter in purchased Aligners, begin These with burn-in. automated this shipping

high with high such and require transceivers, burn-in reliability memory and as volume mix also chipsets and systems automation adding before, large devices noted level wafer offering volume several and production as integrated processes up burn-in incremental high markets an opens and high new have sensors. Aligner XXX% automotive Aehr, to FOX microcontrollers value our even our I through to As volume test photonics and gives devices extremely high our greater such

We here and have automated new see our our benchmarks burn-in integrated Aligners in the multi-wafer come system with going FOX-XP customer and test so Fremont and in the system, through action. Aligners facility can fully at in integration WaferPak completing customers

also We the customers come had to potential automated Aligners in WaferPak in new several see operation.

our and WaferPak to of carbide production Contactors. customer silicon up Our continued the production ramp FOX-XP and use lead systems the

for meet to $XX the needs test devices received months silicon for level to chargers their additional a carbide During capacity vehicles, the million producing to seven order over wafer months quarter, ship electrification six of number electric next FOX-XP systems significant for a increased infrastructure. burn-in and we scheduled and

Each the wafers Contactors million $X.X XX these also of WaferPaks systems. FOX-XP capacity FOX-XP these representing total systems half wafer we month, from of a needed this for time. Earlier has WaferPak and at test the a for of them, burn-in about full devices follow-on to order announced full

Now you and customers. prospective let me benchmarks our tell with new engagements about

make We benchmarks to and our engagements. great progress also continue with announced previously

benchmark the in large on silicon level We players continue of a one with world carbide wafer to work qualification. closely largest the and

finishes towards company to the the continues processes complete that We their as success qualification. this internal are excited qualification

wafer with our test devices level next expect the other over electric silicon the to customers, burn-in the capacity and carbide vehicles As systems decade. supplier demand significant and we silicon large carbide fast-growing of to silicon for carbide meet require

We confident this this long taken has are their them will in understand Test that that the for wafer level result and both success for we WaferPaks FOX using but a time, volume production. Aehr in and systems

this quarter there new of had also customers even a which just customer very multiple new terms We into customer and continued -- productive visiting has potential week. engagement, quarter this in

and/or grown customer world, decided companies us to call, essentially wafer COVID-related Since With forward behind our our progress opportunities and quarter’s meetings directly additional conference substantially. making last to move silicon restrictions has the level systems. carbide purchase throughout currently our three customer-facing full on all new with evaluations devices

need We are from carbide are critical internalizing silicon shift the level for burn-in devices to long seeing test roadmaps near-term long-term execution companies plans and times. and production wafer the of and for product

As the such, carbide some in quotations and It’s coming companies industry are met the that in asking wafer carbide times. past markets us silicon and lead briefly time only for their we semiconductors serving. with that unbelievably designs with the to silicon quick and exciting had are feasibility studies,

from large call, semiconductor ranging firm silicon in nitride RF a power This amplifiers. carbide, a also wafer gallium voltage to new and doing nitride evaluation nitride our semiconductor to commitment needed evaluation frequency to MOSFETs HTRB or stress our the gallium forward radio very full option addition with includes move level high multinational our we for of from with momentum we received devices. devices supplier now suppliers a In last several engaged gallium are critical devices. Since for

critical both to and solar market, companies significant converter quality has the in a applications vehicles. consumer, that of be standard converters inverters very charger production high been will such volume electric driven power of nitride RF the from gallium amplifiers, require applications by these and some believe power and very reliability -- We some needs. as electronic meet burn-in applications and and several will Feedback application’s chargers,

of capability to FOX-XP believe our option, to well test cost-effective a and market gallium capitalize proven in to nitride are way. in believe and we and at time wafers a total can its addressable with we parallel this ability our With burden level opportunity advices high-voltage the on meaningful wafer thousands solution nine positioned up expand

months, last across have I and dozen demand the and Europe, is Asia personally met two companies the extremely with the world. over a U.S. just In across strong

COVID solution China had have far. From perspective, customer since the questions pull of outside has restrictions our about have eased. so for We our much greater China been

silicon vehicle larger that have or inverter modules the itself. mortality several infant Having failures the a pick are in electric producing certain becoming heaven early burn-in silicon China. and up or installing before to they to them said It’s carbide unit of that, important seen remove critically is into into before or electric wafer suppliers carbide them an the we devices and for recently drive level clearer activity at vehicle forbid put of companies

silicon time carbide are which or to the these individual vehicle. of electrical as rate use has the switch more as the a Each MOSFET, of that electric that stress the an correlate conditions during X% burn-in as expected typically life actual much failure conditions or test and acts and to devices endure

as would to auto idle drive and far, hundred the et including several referred be the to the to cetera. This electric mission driving industry running is is thousand vehicle the equivalent in time profile. miles This that profile time,

screening the applications only devices mission drive are burn-in that how critical that OEMs must fail. not in This will the the test to last inverter they carbide MOSFETs such silicon called, life will show are to production in. in for unit devices suppliers as of also production remove electric auto where are prove must is profile, used that they to the of Semiconductor or comes suppliers or vehicles, they ensure as their likely will but

temperatures failures conditions weak damaging and/or without apply -- negative voltages high induce Our can custom devices stress custom industry and at good as devices. standard to such customers elevated -- low solutions on

up every No literally in else a single every has nor unprecedented. this ever single on on a then of anyone devices test this this do at on wafer wafers XX done parallelism to time to pass thousands XXX% device with This company We system. up is Aehr on before time Test a traceability. FOX-XP a today. We is doing

or key any of this solution like other our property intellectual and We patents of company our and a using and something protect functionality violating solution features build solution to patents. believe that we would a tries that such company be have technical number any significant

Germany, major and as automotive maintain world, States, patents Singapore the United such supplier and our the hubs We semiconductor across Italy, China. Korea, Japan, including even

weed our wafer to for in of customers wafer can full test hours they per silicon up the and power overall to whole into failure chargers, more burn-in. capital price costs. burn-in for wafer use the early cost hour modules And in stress used be than life parallelism apply depreciation are on MOSFETs less an their these effectively to devices manufacturing devices. removing actually before of carbide the rates of up and low test improvement of a vehicle, condition or At out cost a unprecedentaly without the US$X XX of and cost driving point to lowers failures wafer stabilize Our threshold put modules yield for leads inverters the per voltage their electric or to power

photonic Our burn-in Contactors level our the this fantastic hearing wafer silicon are proprietary market WaferPak customers. test from are and semiconductor customers potential and wafer we directly fit FOX full with solution and for a

semiconductor move silicon to photonic and me let stabilization. on burn-in Now

the with light-based with not photonics integrated industry silicon electrical As to this transmitters photonics, a what calls familiar are receivers. the both and is semiconductor or combined devices reminder, circuits those where clarify

centers initial farms. a technology into the of circuit This and integrated fiber was with fiber classic device the optic a to component. an lower as significantly manufacturing The server cost way in transceiver communication data transmission was integrates that device to increase optical massively an optic heralded a transceiver capacity and

or The only This a and actually to last was major down long-term breakthrough data proven several was cost data key as of to centers a even is slowed and pandemic production stopped has lower up years. power bandwidths been built considered really the and last initial picking lower but ramps years. discrete alternative over of cost viable transceivers to devices, now the higher customers XX the these the back over

market other market, We being especially to as chipsets continue to integrates an processors beyond fiber expand embedded transceivers for that optic becoming enthusiastic into fiber just technology such optic to this the about looks it themselves. and devices be as used very

NVIDIA and AMD, silicon discussed and leaders, market like photonics integrate Intel, Multiple including into publicly companies their to have chipsets. microprocessors, transceivers their graphics others investments processors

position While scale for we is multi-wafer having silicon it and form. of the transition while still photonics enormous our cost in several also effective at solution out, devices opportunity and an stabilizing Aehr believe with a burn-in this massive still wafer testing unique represents Test and a believe years we proven

wafers We test FOX customers are systems XXX-millimeter, currently well with XXX-millimeter and as our current XXX-millimeter, as at burn-in based today photonics testing today. level wafer

FOX-NP have systems photonics and also customers die using singulated XP We provided our testing and with our modules. for DiePak’s

We the this in dozen strong are systems to at of over pandemic. end opportunity XXX% introduced. beginning has few be during to with for customers see the additional installed silicon data a half the photonics yet and transceivers devices and recovery and of burn-in front of saw weakness photonics currently a we from telecommunication Aehr test used infrastructure, silicon applications XG a

production for both level the and believe As as market we business characterization and for expands, test engineering of will upfront, burn-in. devices as be qualification well wafer more there

we for or years, will and become as and carbide silicon than test larger believe photonics decade. burn-in, level the several next significant the wafer silicon become large in later market a could Over

current least second XX% between the have revenue we shared very opportunities revenue for of $XX fiscal see expanding ends first be and encouraged $XX To least very that confident year with prospective of XX% and the at continue May half which to current positive to guidance conclude, million fiscal we half the in year-over-year growth are in to million at represents XX% of we year. XXst, by momentum the our and year for growth customers, the in this our continued to of compared growth and XX%

our demand fiscal begins also that in June. our grow us in remain vehicle bookings electric up strong confident as faster momentum increases, XXXX this year the for fiscal silicon will than carbide ramp and heading that revenue for into We setting

Aehr want the before finishing years Lastly, fiscal his from after the the with Ken, has indicated announce year intention Test, period. year reporting retire that call company I to turn Ken over CFO, to after this our fiscal to I and after XX

actually me great VP to Ken growth and been has a and pretty time us. board ahead and have I and to contributor CFO amazing a this CFO a phase for good XXXX key development a we feel this during growth. been and and has Aehr of is the on Finance time opportunity tremendous it’s since of our discussed Aehr’s and partner an in for to this come plans with a help new Ken and great

Aehr has help firm is professional candidate exceptional to a Ken recruiting and providing and the assistance support engaged is provide to and already me identified. finance Board a an find executive and when will

this We are very it when a confident happens will be that transition. change seamless

With will it that, Ken you for it over questions. then call -- and to open me let up we turn

everyone. and Gayn, afternoon, Thank you, good

and beating revenue QX As in in growth Gayn noted, we income, and the had with strong quarter our in another sequential year-over-year and net analyst solid estimates top both bottomlines.

We strong also backlog. and quarterly reported a record bookings

of $XX already million backlog effective now $X we an over the bookings first million. with addition, in month quarter, in the have of In

detail. in at The up service from from more quarter XX% sales third quarter sequentially the were sales from increase the in up million, and quarter and the million $XX.X last of $XX.X million in XX% increase $X.X includes Looking net our in million $XX.X of financial in revenues QX an revenue customer $XXX,XXX. sequential systems Net second in third year. results

These $XXX,XXX. for XX% consumables decrease second to preceding of This in revenues total in revenue XX% revenue our compared DiePak quarter. revenues was and a of partially by the WaferPak offset accounted of

with wafer our capacity with increased with our just and grows new in systems new base. the delivery. WaferPaks purchased separate and designs, also device of installed Still, installations with and the stagger Contactor put revenue times not Customers FOX or Customers contactors new increase both typically purchase system place. at with also systems their our

million gross profit quarter quarter sales of million XX.X% Gross sales of the or previous of third $X.X sales, in profit gross in of and of the from of million down third the quarter was preceding from X.X XX.X% or $X.X points or year. $X.X up in percentage XX.X% the profit second

obsolete fiscal to million related products. the a excess $X profit inventory and adjustment year’s legacy impact third for Last quarter, includes gross of

impact year of Excluding in third quarter last margin adjustment, the XX.X%. this was gross the

margin gross product included X.X to due negative to points costs, impact from in prior percentage mix quarter’s percentage last and variance points quarter provision due tariff a negative shipped and warranty The X.X favorable another of the and reserves. inventory freight

partially was in revenues and levels from higher benefit This offset cost fixed margin decrease due of sold, while in grow. capitalization goods quarter to the in manufacturing are our increase an by X.X inventory. point percentage overhead, cost recognized resulting to a With costs relatively a benefits to revenue gross of overhead

quarter net Non-GAAP diluted compares the third quarter XX.X% preceding to diluted compensation. per net the diluted income net quarter which was income million XXXX. of net share or impact or share excludes of revenues. in third and income share, the $X.XX was $X.X the of income strong million $X.XX a or stock-based second of $X.X per per non-GAAP $X.XX million of non-GAAP Non-GAAP in fiscal in $X.X This

of revenues commissions, increases $XXX,XXX due primarily increase bonuses expenses also $XXX,XXX, Operating expenses related from spending sharing on fees increased million includes bookings, the to $X.X and increase on increases an SG&A or quarter and in recruiting in profit preceding based the an the $X.X year. programs. in or the and from salaries, and headcount, to the previous of SG&A related third million quarter XX% of to second employment third million, increase in The in quarter from includes $XXX,XXX preceding up in R&D The second increase $XXX,XXX $X.X profits. development increased XX% of quarter were and

three and marketing sales efforts sales company the During the addition worldwide with of quarter, executives. its senior increased the

making have and excited seeing impacts impact. positive additions to sales professionals those are very these We already are an already of

with to associated programs automated high-voltage and primarily in for module new costs increase bipolar WaferPak and Aligner due our very channel R&D The voltage our development channel module. is

or reverse channel carbide Our using arcing between testing wafer the burn-in. that with between microns module new include high-temperature challenge is that Contactors, can necessary of devices a enables solves which silicon devices key wafer to test on and WaferPak electrical level under high-voltage This proprietary very and high-voltage avoid streets patented anti-arcing high-voltage the devices be distance. bias option our capabilities XXX in

our enhance to invest We competitive expand to to addressable introduce new markets. and products in our and R&D in to maintain advantages existing continue to market-leading our applications products

These increase silicon semiconductors. advantage we gallium markets, memory all in and target semiconductors, programs believe our semiconductors, our and storage and data include power that other R&D photonics XD key nitride competitive devices photonic mobile enhancements and XD sensing including carbide and silicon

the the We a finished strong to sheet sheet. quarter. balance Turning third quarter for balance with the very

$XX short-term Our million equivalents XXth, million at million up cash, and investments quarter from of $XX.X at and of $X.X quarter at of XXXX. fiscal February the $XX.X cash million end preceding from million the were second third the end the up $XX.X

We cash to continue in last year. invest advantage the the income in $X,XXX interest interest to quarter third investments $XXX,XXX, rates, of quarter third excess increases just from up take and was in short-term

noted interruptions to operations. impact operating SVB. we The did at regarded highly operate cash banking closure and accounts maintain our institution over not short-term hold were to in impacted Silicon our Bank. impact only investments Morgan As equivalents our Stanley, cash, the prior a of X-K million our SVB continue We vendors by or filing, customers, Valley any we not closure and or employees and of without $XX at our

million on During to common market. the announced $XX of stock shares quarter, offering at-the-market the open company’s of we the an up in

$XX.X under average sale on an the $X.X per company end, received remains million available million gross of X,XXX of ATM. proceeds of has the As quarter of $XX.XX price share, at shares the

equity the agreement, of company’s ATM it may trading the sell shares terms the closed be during not possession company the the of windows in may information. is material deemed when Under distribution company non-public

existing believes windows plans on source would the of when ATM to best provide against during Also, shareholders. the open company only it minimum it the selling shares and capital dilution with trading

prior increase Working capital from QX QX $XX.X represents increase million million. from at of XXth million February year. an and This was an $XX.X $XX.X the of of

quarter an million up at from XXXX. quarter the the third $XX.X of the million, preceding fiscal end of were Inventories and quarter million $X.X the of third increase $X.X from

meet inventory to demand. We to and are ensure revenue to supply backlog our support market projections increasing and current customer adequate future near-term and our

us purchase sellable our Our and only This purchase customers to of across the differentiated material ability one market to many confidence unique is material leveraged or highly customer that FOX is in market. that provides one family without opportunities systems us markets. to significant to allows meet having

manufacturing an August months quarter, The of for the of offices amendment extends lease includes five and we recorded operating X, commencing for million our our lease years calendar for During expiration the corporate lease renewed a and further facilities. company of lease the assets period lease with and company XXXX, the on period the term the this after to long-term XX for extend the right-of-use corresponding additional one date. operating renewal, of short- $X.X With liabilities. option

of We $XX.X million Backlog the February compared quarter million, $XX.X $XX.X to quarter record finished $XX.X as million the single of was the preceding and third of million. end the the last for at quarter end second with at year. XXth quarter a bookings of

for the backlog, of $XX.X fiscal is over our the $X Our the is orders million of year. $XX.X all fiscal the bookings the total $XX since in million. March third full including million Total includes million, prior effective quarter year-to-date, exceeding end which for bookings received

we meet to company’s ends are demand. XXXX, in and product confident our customer capabilities fiscal which our May and turning Now on outlook XX, trajectory for unique to XXXX growth year, the offerings

XX% year-over-year, at yield we year. previously of guidance least for similar XX% last least margins strong revenue total million such, with representing profit to full of are to $XX million As our reiterating at $XX to growth provided

into demand electric expect silicon build grow revenues in ramp vehicles going faster and for fiscal and carbide We in increases as the than continue bookings momentum to to XXXX XXXX. fiscal we

earnings We call. expect to July provide our guidance during XXXX for fiscal

month three Aehr months. Lastly, the Investor next next looking the at in over -- will Test participate conferences calendar, few investor Relations

Institutional XXst, we at be on Craig-Hallum Conference on conferences. taking Growth Conference the some be at Chicago. hope will with Blair William in-person Oppenheimer meeting May place Growth to X investors see on the We these Emerging in Conference in-person May XXth, you taking the virtually will place at and of investors in meeting with and Minneapolis June Investor We at presenting

over to questions, turn regarding operator to earlier I’d to it the like my add for I Before Gayn’s comments retirement. pending

With opportunity customer and in opportunities, the an Aehr company customers forward, growth this for the and Test the new CFO excellent and market engagements a level. time increase expected and is for moving to next team the take build to their

valued last it’s Test the with I presented. the years and greatly I appreciate XX opportunities Aehr

retired of is happen that so to we excited chapter as lifes. wife can our noted, years Gayn ago couple as be on and clean As a a found takes in that before next I also that soon CFO actually, ensure on my I stay will as replacement leave. transition and possible will suitable to know I a who place I for until move the successful can

prepared concludes This our remarks.

Operator, ahead. Now please questions. we are to ready take go your

Thank much. Instructions] Christian ahead. Today’s [Operator you Please very question with Craig-Hallum comes Group. go from Schwab Capital first

well-deserved questions. good taking for you. spend the congratulations for people on Thanks guys. Hi, retiring, Hey. time free you love, to go Ken, with my opportunity

quick that a all So gave, few questions. I you Thank the just Gayn. for you have clarity

would take in large from Just year you customer a it relates third customer, to fiscal your expect as orders next far the them? production as to

far. so We four have in total carbide actually announced silicon a of customers

from fiscal orders next the of year. all during them production expect We

different orders three And when silicon the that the new out? would six Perfect. the on from That customers, next that happen photonics you or question. two is that and you. that as answers Is area. first soon years something to could years then meaningful this Thank fiscal year anticipate

on COVID didn’t forecasts I some candidly, just customer are transceiver we same that So, rising happened. us I actually are previous the seeing the in they we XXXX that they that the of XXXX and we that see the mean, told to it just back going mean, forecast in are seeing to business. when think buy plan based we of call tide

there we So think that. tide rising be a will of

big is more maybe think is trying what that I importantly, are wave. to when to next you get

We we new have some already think year and as early that, are qualification those can doing purchases some of next that of work some on on seen well. continue products and types

the out but we front under kind a of think quickly. be the making there’s been are is couple news some could and of it it’s turn cetera. now, right start we see And going -- the years, the on really production when of assuming to do announcements, end of out Internet few and any I some meaningful company et to still there

really So are close to we it.

automation the the what on us, we what can singulated I those -- based different have cetera. with customers more and mean telling can have We forms we we or et today, products. in with and wafer are even new test automated hands-free, the of we devices with even each die Aligner, can do it

well lot we to little will to positioned will, wouldn’t some, But next is of then certainly closer record, there I we that revenue they are are I go and plan really just the as and So with begin focusing we production, to we and when it a tool we of I be be doing are what engineering if but you a think put for don’t probably year, know expectations -- will hit okay? see. be

to Great. or expect you occur to carbide. of would something providers maybe has fiscal And next to just substantial get negotiations then where of started? shipments that the something silicon expansion that domestic opportunity is know where Chinese and you Is year

that our pretty think there’s we China. for reasonable market purchases for are that significant, mean use are for I a that of I lot, lot or China but systems, see. currently will believe We companies we the going serve word a clarity, we to not in a get

-- grow. today. that know We going there that we doing So already that’s are to

for think is to there’s not China be in all okay? silicon China, I for going example, carbide built

in to China. OEMs China, talking also as in are We suppliers well as

kind if that of new are this way food you which and as to are chain, is realize thing. Xs making a we several up close that completely the with So our people will, with OEMs, Tier conversations

guys craziness realize chain, talk Tier who automotive they guys. to the Xs directly Prior semiconductor that all need step with to went guys. automotive They to bought guys, and us. to semiconductor worked talk the the are the the Tier on to none all of supply go and right? the further, from to talking they COVID, guys are then we taking But with a Well, Xs semiconductor

we candidly, there’s China. et how I way cetera, be that, another of we are in be and creating solution, we in it, in that have significant confidence Having year would oars in and our portion what are to and going around So the think said a traceability, the without very of several next our the water clarity plans. so things say would trying confident upside in I offer, to

Great.

be want I you talking about When the were about So Gayn. China you six. carbide, just talked to silicon clear,

more likely think that... is is producers I customers, that wrote Chinese I demand, Chinese six domestic than for domestic

targeting those to are that -- I I there the China currently are silicon be belief I to in my But carbide, the are It by saying am about my believe okay? When are big you, six in. their most said markets. they are sure companies talk not six if we domestic way, that ever likely six. I It’s silicon going players Chinese that have in is type a people photonics

but lot with can that a China, if of will, to China that, Domestic suppliers you silicon said right? domestic in we suppliers so having both we China, outside also non-domestic from But carbide automotive today time. buying play companies suppliers Chinese the over and think of are

one Great. that. quick And Correct. you quick -- question. for just Thank Correct. last a

as kind as On as backlog. year, quarter did as expect the we we -- is concerned, of February would very a of trajectory backlog where strong have -- far last similar you

We the year strong with some enter that next that have tell… what very to believe number, we a worked you look then and with the backlog Are too idea fiscal through enter of early strong of year going will really like. do a to

we… Yeah. I mean,

objective year? … next for

a if on guidance. is. quarter then it’s realize lot don’t We you haven’t give quarters, of We been pretty I that’s give but the it. doing what guidance clear of top still revenue But quarterly annual really focus. three

to seems not picking There’s be of a things now. lot see a I There their that, is people reality up. accelerating dwarf. right plans The

a than even out of we other We year. I year lot visibility There’s believe will putting more top -- lead lot into we go people for asking next and are a with of on of having last a times quotes. lot are each

will be we or buy. number a on with said I large in customers nothing customers, that distributed it’s to customers, it but are across that of some to which the all also guess two or think larger going of continue not much -- there’s Having that, averaging one going terms

add but ways So -- I year. next Aehr mean, and out I enthusiastic the that into us heading in recognizing on are doors many value is really right am describe I don’t I the optimism, are to and know knocking our how all people can about we different addition us seeking super

Gayn. Thanks, question. other No Fabulous.

Thanks, Okay. Christian.

question with next go from William The Dorsheimer comes Jed Blair. ahead. Please

congrats. Hey. questions Thanks will my the for taking and echo here, Ken, I

Thanks, Jed.

numbers the and one. at So first or question, variance kind maybe of game, reiterating the take the want either I Ken, $XX Gayn stage you $XX pretty guess million. guide in wide suggest million this to a But maybe to

Yeah.

tools thing that that you the million can But is that difference that that fall of more only the know we the there is provide -- bit sure -- weren’t something the that wondering, weren’t to were a rev I of get you there of kind into $XX color on? And with quarter. that I were the or two not you sort else am rec probably

capital recognition and by have is along get when that That’s when Aehr for you all different policies paid and revenue folks that to score you with equipment than can a think, revenue are Test big the way. -- I chunk companies most, related

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a quarter, shareholders the have on large we revenue. as in. going we sure that be our some but are pulling big That’s revenue pretty to got just back to shipping a more we normal, And or It’s understand detail that things things. detail will pretty why candidly, that may related and during heads-up of that probably number gave than lot make may not score

you by it And implied, QX. it’s in whether been I in, comes pretty are What that though that even talking and easy. and sure or just make misses it’s we tool about QX dollar have days multimillion be several few a want to I just will explicit

bulk that’s of So it. the

now so designs of think, have designs. all but are Folks, XX like new wafers. all recognition when the We cetera, customer as well a ones also These WaferPak have expected next timing, designs into et into are process. that first almost year. we just timing right -- WaferPaks XX then those production with not to Those those go lot of I much are ship, volume of in revenue new the are

So there’s of too, that that, up. some adds

to more I how -- milestone threatening we as where do we you us. deals, this but have have we do I think are not treaded in range still, over threatening still And any realistic are identified has describe to we that momentum public company, you -- we -- lost terms mean, enthusiasm, we like new not have our -- we at. where and any are a thing re-describe trying at, We again, they we of be are coy. not up competitors will of customer have We not quarterly don’t you, but tell are we it? picked still or how that’s a

come and variation it we know the in with scored there. earnings up call ends by have in the week There’s not, time July. already last it probably to Probably will if comfortable or some down exactly our two the going to numbers. where in So what

we So how it goes. see will

Sorry about that, Jed.

No. is The color helpful.

guess the on off vectors, how dropped just Is balance there. you in those customer a but you could some Inventory, sheet. me you should just of more color help could provide I bit products, two deposits was reconcile up I that issue two ramping of will? you picked just if moving these wondering we not a you. talked or about thank terms parts. as if timing surprisingly So read if

good to good and in move a observation [ph]. That’s Yeah.

circumstances So and we payments. contractually It’s terms some take with There threshold actually a good are that. where with for we have pretty do specific taken down do them conditions not customers. to actually

waived a guarantee the also tell a it’s customer, it’s at a brand-new them at product to we work time, then on little and going have begin money. we holding to to with times with, because payment same the down odd I new their

a where deposit they are there’s people on is and those it deposits. that candidly, what not that’s But harder too. earn a And the backlog Ken, bit think, back pushing of examples of lot on harder a is I all are more money little and that seeing. can of you some of some out lot of

last Got it. me. And then question for

their Just we the previously This has guess, a this but customers, that, which said, I announced that the one But talked run not announced of you about them as think silicon serves, major… intention think, second carbide. publicly memory not named is four through, I have I have at into point. there’s

Yeah.

I put silicon this just announcement correct. semiconductor make that, is want have in an out … point carbide. that sure to at provider. They

they I But they still not ago still go should believe a I have have -- again. least they not said week in about look they at are it. hadn’t.

Interesting. Yeah. So still quiet.

it All offline. right. take will I

you. thank So

Okay.

Okay.

Thanks, guys.

Jed. Thanks,

Please from ahead. Patel Dylan go SemiAnalysis. next is The question with

to the How the because aligner. Right having does ask trouble I impact does revenue? the new over growth the Hey. have am that that aligner. Gayn you great now like impact color. about automated aligner, I manual How with wanted time?

What you configured visited of by three one How to of the treated me I over versus but that I aligner, a sell systems, and you XP I like time… a you the get more FOX should when manual or penetration are folks the ago, told one-to-one. think think, have the month sort develop systems about? is that automated aligner aligner going automated aligners is can

Okay.

to yeah. going or, go everything … automated

All right.

we yeah, for make we and of sell So, clarity, today two actually aligners. types -- make

had for we have have customers aligner. installed aligner a call automated We also years, what actually in we and an multiple manual

cassette group of aligner to and walk then or into and a automated The present take automatically put then it of wafers WaferPak allows in WaferPak wafer, it. with platform we a it wafers you a call and that will up WaferPak a

of automated it’s to you actually our this place for XX okay? can aligner. now an them, that example, into system So up cartridge That’s

that said, came a do a you cool to make customers allow is they and also which want we manual them, that aligner, really it’s user We a quick well. we developed trained internally very tool as proprietary do had still great it people and a process. can alignment sort for but of sequence. It’s to But engineering, that production be use for a and actually

that tends engineering It can the is do and button, interaction be of consistently to Automated, repeatably a but operator, you something it okay? both sequence, intervention. has a the Manual push that follows very you operator just and certain production. for more

new automated fourth generation. really It’s aligner. We developed our considered have a

said working it that one this the We it’s and we on now for have quarter. over began years we been three fiscal solidly shipments on

for customer taken orders We multiple it, right? have already

about least going well passionate how company we did that very of of team really say anyhow, is. you -- of way anyone all it, the this one learnings else it out this our thought in and level over our thinking am will. the my But I good to world. through burn-in know, those people a if know babies, wafer than at designed in we more I Interestingly, for is It’s job think, the

cassettes you cart can them into cart wafers be then align and of wafers so or mode and where automatically cart be to things so a put can moved with we that load of a over one And can then it will subtle in feed and at standalone you that systems. not a XX wafers it the a what have subtle, up and is our so can call one

door the the wafers XX go, in, door put You okay? and close open you hit and

at current it and more which the a one, systems. one than multiple up case, does you our WaferPaks load FOX-XP amongst WaferPak around This automated in and can it’s move it’s only a cart. offline But that time. can actually share So

back, in footprint. back time a open dock of cart have and wafers to in it an and an it XP, each of can to a you XP and has flow exact the instead will and XX That blades very aligner at close continuous same of small a this in allow also

don’t covered. feel that’s go off-line, fine companies the whichever only and way I need passionate way if candidly, you to got you some want them you is we automation, think, with But you if Now them, want feel companies argue we us. some no, and with

do like it to it. to I feel reasons people different want you feed. I If There’s manual, do it

well, as covered that and in have taken We orders have both. fact, we for

can them. interchange you and So,

to, up in and adapt it and so could work take it to automated standalone that have can product will or day out. and aligner one really you If a across wanted well XP customers. move it. probably a we an dock in multiple an that’s you It’s thought It’s

XXX-millimeter microcontrollers It silicon like will photonics, types, devices and large silicon and and type work GaN those type RF, scale processors. GaN devices other wafers memory carbide from across XXX-millimeter for silicon silicon XXX-millimeter XXX-millimeter devices, GaN photonics carbide, and devices,

that flexible So it’s really a very we of. are system proud

I So helps. hope that

have So, recognized Yes, the to rev absolutely, aligners have we that customer. that hey, because the do have yet, been accepted they not rec. at revenue automated add Gayn, we the not of topic to

into about So that policy. same had our talked you criteria earlier in those the rev fall rec

Thank you.

Thank you, Ken.

So…

way And by if… the

Okay.

Yeah.

an don’t places upgrade of we if system XP aligner, Sorry, and time it, revenue, still and then order with just okay? XP an ahead that customer one more both we XP a ship the recognize And thing. the the for integrated the

continuation until that’s revenue to. okay. Is happen? QX, what’s be right it that’s this Because got going aligners stuff a a lot related and of to is we or going to that of are those QX kind the When have now of accepted

ahead. Sorry, go

while of also your for think of It revenue -- it about the I to revenue thing, cheap the kind tool deployed? because this isn’t right? from How you bit as So, it it and made an should that like I more a increase utilization right, X:X the to or but for there’s going or it forward, is FOX-XP increase with does a so and companies the that sort and per a about XP way XP. think it aligners it are more does automated that that lot are your directly utilization, you and cost a the increased paying -- they should is

fact system allows have four. It efficiencies, that of advantages one there actually ASP by are drive choosing well, integrated to those one the the -- It you would per I has versus some or or that to them by offset maybe and three competitive up. But it not candidly. go being integrated of into advantages absolutely reasons, all to, some contrast doesn’t being

manual that, and companies so factory are not to way and that passionate any other not that is also in we There’s have having wanting that passionate are their operations best to that and WaferPaks people about moving do them. just it the around, to offer

one are cost has argument of would could in the and you of that make advantage automation. you that they the I test tell similar just

floor. potentially some advantage and on has of an one other of flexibility test The the across tools fungibility times

they be of use Is use as you would of that to too thank thinking are sort are Okay. wanted going on GaN? burn-in are you are the GaN GaN carbide, the them couple doing mentioned about that -- the little Do for application? there the burn-in lot major they One customers past. haven’t silicon long well are would times, companies the in for doing comment talked some and least to the answer. burn-in well. Is GaN -- in Is or last times much that as hone at you of a of for -- you think a I you

Yeah.

you about bit more? Could that Yeah. a talk

shifted. that’s what think I

an If the for quarters to specifically production quarter, it last maybe we said, at people market think, significant look of have to We about first it. time, quarters, maybe attractive for last breadcrumbs that some are are mentioned kind I people talk the that us. ago, times GaN test requirements for starting now describing and two the would over I hey, couple burn-in make of you I

rate there’s applications that have that obvious the devices need, guys, burn-in. more is production an That okay? the would for that these applications it to require automotive mortality includes infant as other seems well -- actually interpret but The way exceeds

we still those the of by ship one have production that can though up rates burn-in, way, the weed the are is decades a and you mortality have shipping have there it in into brought for infant the industry out they production been high that using devices By Even things devices burn-in. application.

burn-in Aehr will put XXXX one An in would in. was So be are since commoditized and the example leaders one They map production Test the market still the was around of burned on building right? being been that what if systems. of that DRAM, products of DRAM has DRAM, us most you

So it doesn’t away. always go

with fiber silicon for these are kind optic hotspot photonics, we applications, is like silicon new need but terms or the rate electric vehicles seem things desire what a carbide, of And infant and going to very are in both applicability compound communications, wafer for susceptible modules devices are level of the burn-in, this also be other mortality because multi-chip put devices. seeing to in semiconductors driving

So a it’s RF are wanting and production being seen have devices automotive even we put burn-in. applications. about people for specifically the -- GaN power people into us to are There talk

out now the it’s and we of first message getting with have them. time that several engagements we are So

Dylan? wafer Anything I them lost, Dylan. burn-in already us test level drawings a the long for application with think application of to forward burn-in else, One move need. time we has given they

did. next think question. we The I

All right.

[Operator would you from if to Matt The like Dylan, Instructions] comes Research. question the Equitable with next queue. Winthrop rejoin

the I up that this the and that effort congratulate good my -- company doing and diligence have due and your side and so want to I are keep once just tenacity you did tickled many led so successful think on happy just thank clients to ship guys… you based and friend, go again great, you just the I getter on all PR and wanted I have you again work because the am

Thank you, Matt.

by but PR too. on enough the think, Jim way, they been Your get diligent guys, have don’t I this, Byers, congratulations,

I want to… just So

it Everybody walk Thank all because proud building, been funny. has you. a -- And people you of -- sake, know We come will there’s we here, butt this what, and play they out our we it, around just works if believed in hearts and for there’s you are off, sometimes this lot having build that it’s if happy, their like believed would working it. it’s out.

just are it’s seeing not And we silicon.

one the silicon carbide the it that, people go burn-in, you to it really as for as that that well, are industry pushed then over to for thing it’s level going will seeing think the widely sort use use down saying, well. one adopt -- we I already I this if of can wafer but was

it’s coming So been a and a way long Thank you. time go. we really have long exciting. to It’s

Thanksgiving at back Good forever carbide Keep and changed work. but plugging. you you. difference silicon dinner also work Go to and to on anyway. and GaN Thank have between stuff, conversation

you. That’s it. thank Well,

Okay.

Yeah.

Appreciate it.

Yeah.

there closing time, turn back further in and management to the are this queue I’d At questions no for like remarks. to

and time our Well, All folks we here be I right. really customers. really to are everyone’s appreciate serving excited

seeing manufacturing a we floor call next is as to chance Fremont, you and We if then just conferences of town and if the here have would just be to will much. and happen questions on have of Bay some We talk answer many in a -- California, folks in you as host the our for any coming forward we offered, always to up, buzz. you you you will at look very Bye-bye. are about love Area in talk not, you to to next our we year. we fiscal Thank that

now Thank you The concluded. for conference presentation. in today’s has participating

disconnect. You may now