Aehr Test Systems (NASDAQ:AEHR) reported fiscal 2026 third-quarter results and described what CEO Gayn Erickson called “strong momentum” across wafer-level and package-level burn-in markets, driven largely by AI data center infrastructure demand. Management highlighted sharply higher bookings and record backlog, while results for the quarter reflected lower year-over-year revenue and a non-GAAP net loss.
Bookings surge and backlog reaches a record
Erickson said the company delivered more than $37 million in quarterly bookings and a book-to-bill ratio “exceeding 3.5x.” CFO Chris Siu quantified third-quarter fiscal 2026 bookings at $37.2 million, up from $6.2 million in the prior quarter, and said the company ended the quarter with a $38.7 million backlog.
AI and data center demand drives wafer-level burn-in activity
On wafer-level burn-in, Erickson said interest is accelerating as devices become more complex and power-hungry, making burn-in increasingly important for reliability in “mission-critical AI, networking, automotive, and industrial applications.”
Erickson disclosed a $14 million follow-on production order from Aehr’s “lead wafer level AI accelerator processor customer” for multiple fully automated FOX-XP wafer-level burn-in systems configured to test nine 300-millimeter wafers in parallel, along with proprietary FOX WaferPak full-wafer contactors and integrated WaferPak Auto Aligners to enable hands-free operation. The order also included additional Auto Aligners to upgrade the customer’s installed base to full automation.
Erickson said Aehr is “the first company to successfully demonstrate and ship a wafer level burn-in solution for AI processors,” and described the FOX-XP as capable of delivering “up to thousands of amperes of current per wafer” for high-power AI devices. He said the company is also engaged with multiple additional AI processor companies on benchmark evaluations, while noting one top-tier benchmark program has taken longer than expected due to “a technical misunderstanding on the clock configurations,” requiring WaferPak redesign work over the coming months.
Silicon photonics and power semiconductors contribute to demand
Erickson said Aehr recently announced a “major new silicon photonics customer” with an initial order for multiple high-power FOX-XP wafer-level burn-in systems aimed at the hyperscale data center optical interconnect market. He said the systems—spanning engineering qualification and high-volume production and including both FOX-XP and FOX-NP configurations plus WaferPak contactors—are scheduled to ship in fiscal Q4 ending May 29, 2026, and that the customer provided a forecast for additional FOX-XP production systems over the next year.
Erickson also said Aehr received a follow-on order from its “lead silicon photonics customer” for a new high-power FOX-XP WaferPak system and an upgrade of an existing system to the company’s latest high-power, fully automated configuration. He noted Aehr has integrated its systems with the customer’s autonomous guided robots for “fully lights out, hands-free operation.”
In power semiconductors, Erickson said Aehr continues to work with its lead gallium nitride (GaN) production customer on new devices across markets including automotive and data centers, adding that the company believes it has “solved the key challenges with full wafer burn-in of GaN devices on silicon.” He also reported a new silicon carbide customer in Taiwan focused on the “Greater China EV market,” which ordered a smaller configured FOX-XP system for qualification and production. While Erickson said he is seeing an “uptick in activity and forecast” from silicon carbide players, he emphasized the company remains conservative and is “not yet counting on significant revenue from this segment to return yet.”
For memory, Erickson said a key supplier engagement is progressing and that Aehr has achieved the correlation the customer requested. He said discussions are now focused on specifications for next-generation flash, particularly high-bandwidth flash, with the hope of closing in the next few months on a development agreement that would involve a 12- to 18-month development of “memory-optimized blades” for the FOX-XP and FOX-NP platforms. He also said Aehr is in discussions with other memory suppliers that produce high-bandwidth memory used in AI GPUs, framing memory as a potential driver of orders in fiscal 2027 with ramps in fiscal 2028.
Package-level burn-in: hyperscaler production win and expanding pipeline
Erickson spent part of the call clarifying terminology, saying Aehr is shifting its language from “package part burn-in” to “package-level burn-in” to reflect the industry’s evolution toward advanced packaging and multi-die modules.
During the quarter, he said Aehr announced “a key production win” with its lead package-level hyperscale customer, described as a “premier large-scale data center provider,” for production burn-in of the customer’s next-generation, “significantly higher power AI processor” with an initial production order of high-power Sonoma systems. He added Aehr expects a “significant near-term follow-on order” for package-level systems supporting the customer’s current high-volume AI processor, and said the customer is forecasting “a substantial expansion” of Sonoma purchases starting in the second half of calendar 2026 and continuing into 2027.
In the Q&A, Erickson told William Blair’s Mark Schutter he has been “surprised at how many devices are not yet doing production burn-in,” but said a common theme is that customers are “all moving to burn-in” as processor power rises. Erickson also said the hyperscaler is asking Aehr about design-for-test (DFT) features for a future device to potentially enable wafer-level burn-in, suggesting a progression where customers may adopt wafer-level screening when it is feasible and cost-effective.
Erickson also said Aehr received an order from a brand-new customer for Sonoma for reliability qualification of a new AI processor, with potential for production burn-in on the same platform.
Financial results: revenue decline, margin pressure, and ATM completed
Siu reported fiscal Q3 revenue of $10.3 million, which he said was in line with internal expectations “due to delayed orders,” but was down 44% from $18.3 million in the prior-year quarter. He attributed the decline primarily to lower shipments of FOX systems and WaferPaks in wafer-level burn-in, partially offset by stronger Sonoma and burn-in module (BIM) demand from the hyperscale customer.
Contactor revenue—including WaferPaks as well as BIMs and burn-in boards (BIBs)—was $3.0 million, or 29% of revenue, compared with $5.9 million (32%) a year ago. Non-GAAP gross margin was 36.5%, down from 42.7%, with Siu citing lower volume and a less favorable mix versus the prior year when WaferPak revenue was higher. Non-GAAP operating expenses were $6.3 million, flat year over year, as the company continued investing in AI benchmark and memory projects.
On a non-GAAP basis, Aehr posted a net loss of $1.5 million, or ($0.05) per diluted share, compared with non-GAAP net income of $2.0 million, or $0.07 per diluted share, in the year-ago quarter.
Aehr used $3.7 million in operating cash flow during the quarter and ended Q3 with $37.1 million in cash, cash equivalents, and restricted cash, up from $31.0 million at the end of Q2. Siu said the increase was primarily due to proceeds from the company’s at-the-market (ATM) equity program. Aehr raised $10.5 million in gross proceeds in Q3 from about 269,000 shares, and since quarter-end raised another $19.5 million from about 477,000 shares. Including $9.9 million raised in Q2, Siu said Aehr fully utilized the $40 million ATM authorization, selling more than 1.13 million shares at an average price of $35.38.
Looking ahead, Siu said Aehr expects full-year fiscal 2026 revenue to be on the high side of the previously provided $45 million to $50 million range, and non-GAAP net loss per diluted share of ($0.13) to ($0.09). He said the company expects gross margin to improve as manufacturing activity increases and expects to return to non-GAAP profitability in fiscal Q4.
Siu also announced Aehr will change its fiscal year end from the last Friday of May to the last Friday of June, effective after fiscal 2026 ends on May 29, 2026, with a one-month transition period to be reported alongside the first quarter ending Sept. 25, 2026.
About Aehr Test Systems (NASDAQ:AEHR)
Aehr Test Systems develops, manufactures and sells semiconductor test and burn-in equipment used by device manufacturers to ensure quality and reliability of integrated circuits. Its products are designed for wafer-level reliability assessment, functional test and stress screening of memory devices, system-on-chips, optical components and power semiconductors. By focusing on wafer-level burn-in and testing processes, the company helps reduce cost and improve yield for high-volume semiconductor production.
The company’s product portfolio includes FOX series wafer probe test and burn-in systems as well as ABTS burn-in ovens.
