Aehr Test Systems Posts Record Q4 Bookings, Projects 180% Revenue Growth

What happened

Aehr Test Systems reported fiscal Q4 2026 results that exceeded analyst expectations. Revenue reached $18.84 million, up 34% year-over-year from $14.09 million, while adjusted earnings came in at $0.11 per share versus consensus expectations for a loss. The standout metric was quarterly bookings, which hit a record $60.7 million, up more than 500% from $11.1 million in the prior-year quarter. The company's backlog reached $80.6 million as of May 29, with an effective backlog (including subsequent bookings) of $100.6 million. For the full fiscal year 2026, revenue was $50 million, down 15% from the prior year, and the company reported a net loss of $7.1 million. However, Q4 swung to a net profit of $1.4 million from a loss of $2.9 million in the year-ago quarter. The company ended Q4 with $116.5 million in cash and equivalents, up from $37.1 million the previous quarter. Non-GAAP gross margin improved to 45% in Q4, up from 35% a year earlier.

Why it matters

The results signal a major inflection point for Aehr Test Systems, with the company transitioning from a period of revenue decline to anticipated rapid growth. Management's fiscal 2027 guidance of $130-150 million in revenue represents 160-200% growth over fiscal 2026 and significantly exceeds Wall Street's consensus estimate of roughly $85 million. The guidance is supported by the substantial backlog, which provides strong visibility into future revenue and lends credibility to what might otherwise appear overly ambitious. The company also projected non-GAAP pretax net income margins of 18-22% for fiscal 2027, indicating improving profitability alongside revenue expansion. The record backlog and expanding customer relationships suggest that Aehr's burn-in testing technology is becoming increasingly critical as AI chip complexity and reliability requirements intensify. The company's shift away from EV silicon carbide dependence reduces concentration risk, while its growing exposure to AI infrastructure positions it to benefit from ongoing hyperscale data center buildouts.

Bigger picture

Aehr Test Systems has undergone a dramatic business transformation over the past two years. The company has pivoted from over 95% dependence on silicon carbide testing for electric vehicles to a position where nearly 95% of fiscal 2026 revenue came from non-EV markets. AI processors, CPUs, and network processors now represent approximately 71% of annual revenue, with silicon photonics and data center applications accounting for about 20%. Together, AI and silicon photonics burn-in made up more than 80% of Q4 revenue specifically. This shift reflects broader semiconductor industry trends, as demand for AI accelerators and high-speed data transmission components intensifies while EV adoption has experienced a slower-than-expected growth curve. The company's wafer-level burn-in technology addresses a critical need in AI chip production, where stress-testing before packaging helps ensure reliability in increasingly complex processors. Management highlighted that its lead AI wafer-level customer has moved all production burn-in screening to wafer level on Aehr systems and is forecasting higher capacity needs. The company also completed a benchmark test with a key supplier of AI accelerators, CPUs, and network processors that exceeded customer expectations, potentially opening a significant new revenue opportunity. In package-level burn-in, the lead hyperscale customer is expanding Sonoma system purchases for a second device with twice the power of the first. Beyond AI, silicon photonics represents another growth lane, with the lead customer ramping automated wafer-level systems. Power semiconductors remain part of the story, with Aehr receiving about $8 million of new silicon carbide wafer-level burn-in orders in the last month, including an order tied to one of the world's largest automotive companies.

What to watch

Investors should monitor execution against the ambitious fiscal 2027 guidance, particularly the timing and size of system shipments in the first and second quarters. Management indicated that Q2 should be especially strong due to package-level Sonoma shipments. The progression of the pilot production validation in Taiwan with the major AI accelerator supplier will be important, as management indicated this opportunity represents potential upside not embedded in current guidance. Watch for updates on capacity expansion in Southeast Asia and Taiwan, as well as the revenue contribution from consumables (WaferPaks and burn-in module boards), which management expects to remain around 30% of revenues and provide a recurring revenue stream. The mix between AI processors, silicon photonics, and power semiconductors will indicate whether diversification is progressing as planned. Finally, institutional investor activity bears watching, as hedge fund positions increased from 17 to 25 funds holding approximately $60.9 million in stakes as of Q1 2026, signaling growing professional investor interest ahead of the anticipated recovery.