Semiconductor equipment maker Aehr Test Systems beat Wall Street's targets for its fiscal fourth quarter and predicted accelerating sales and earnings growth in the year ahead. Aehr stock surged on the news Friday.
The Fremont, Calif.-based company late Thursday said it earned an adjusted 23 cents a share on sales of $22.3 million for the quarter ended May 31. Analysts polled by FactSet had predicted earnings of 21 cents a share on sales of $22 million. In the year-earlier period, Aehr earned 23 cents on sales of $20.3 million.
For the current fiscal year, Aehr forecast revenue of at least $100 million, representing growth of over 50%. Wall Street had been expecting fiscal 2024 sales of $102.6 million. In the just-ended fiscal 2023, Aehr posted sales of $65 million, up 28% from the prior year.
Also, Aehr sees net income rising more than 90% in fiscal 2024 to at least $28 million. Last year, its net income rose 54% to $14.6 million.
Aehr Stock Spikes After Report
On the stock market today, Aehr stock jumped 18.2% to close at 48.96. In intraday trading, it notched a record high of 49.80. During the regular session Thursday, Aehr stock rose 3.9% to close at 41.43.
In a news release, Chief Executive Gayn Erickson said the company's fourth-quarter performance was fueled by sales of test gear for silicon carbide semiconductors used in electric vehicles and EV charging infrastructure.
Another growth area was equipment for testing silicon photonics devices used in data and telecommunications infrastructure, he said.
"We saw fiscal 2023 as a breakout year for our unique and proprietary wafer level test and burn-in products," Erickson said. "Our engagements with numerous potential customers give us confidence in our growth expectations over the next several years."
Aehr Is On IBD Tech Leaders List
Aehr makes semiconductor test and reliability qualification equipment. Its recent growth has come from systems for test and burn-in of silicon carbide, or SiC, power chips, mostly for electric vehicles. Burn-in is a stress test of a component to detect problems.
Aehr stock has been volatile lately. On June 2, it broke out of a fourth-stage cup base at a buy point of 40.69, according to IBD MarketSmith charts. Aehr notched a record high of 44.25 before retreating. On June 26, it tripped a stop-loss sell rule when it fell more than 7% below its buy point, based on IBD trading principles.
Late-stage bases can be risky and are more prone to failure, according to IBD trading guidelines. But in a positive sign, Aehr stock found support at its 10-week moving average line during the pullback.
Aehr stock has a best-possible IBD Relative Strength Rating of 99. That puts it in the top 1% of stocks for performance over the past 12 months. Further, Aehr stock is on the IBD Tech Leaders list.
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