Aehr Test Systems (NASDAQ: AEHR), a worldwide supplier of
semiconductor test and reliability qualification equipment, today
announced financial results for its first quarter of fiscal 2021
ended August 31, 2020.
Fiscal First Quarter Financial Results:
- Net sales were $2.0 million, compared to $5.5 million in the
first quarter of fiscal 2020.
- GAAP net income was $107,000, or $0.00 per diluted share,
compared to a GAAP net loss of $413,000, or $0.02 per diluted
share, in the first quarter of fiscal 2020.
- Non-GAAP net loss was $2.0 million, or $0.09 per diluted share,
which excludes the impact of stock-based compensation and non-cash
net gain of $2.2 million and a tax benefit of $215,000 related
to the closure of Aehr’s Japan subsidiary during the quarter. This
compared to a non-GAAP net loss of $214,000, or $0.01 per diluted
share, in the first quarter of fiscal 2020, which excludes the
impact of stock-based compensation.
- Backlog as of August 31, 2020 was $1.2 million.
An explanation of the use of non-GAAP financial measures and a
reconciliation of Aehr’s non-GAAP financial measures to the most
directly comparable GAAP financial measures can be found in the
accompanying tables.
Fiscal First Quarter
COVID-19 Related Business
Impacts:
- Bookings and
Revenue
Negatively
Impacted
by
COVID-19 –
Fiscal first quarter bookings and revenues were negatively impacted
by pushouts of forecasted customer orders and production ramp
delays for FOX-P systems and consumables for silicon photonics
transceivers used in data centers and 5G infrastructure, devices
used in automotive applications, and sensors used in mobile
devices. These customers have indicated the pushouts are temporary
and that they will require the additional system capacity and
consumables later in the current fiscal 2021 year.
- New Customer Evaluations
and Orders
Experienced Delays
– Travel related restrictions due to COVID-19 and overall
caution in a significant number of new potential customers
worldwide has delayed evaluations and initial orders for Aehr’s
systems and consumable products in the first quarter.
- Temporary Cost Reductions
Implemented in
Response to
Delays in
Expected
Orders and
Revenue – During
the quarter, Aehr implemented temporary expense reductions across
the company including pay reductions of its executive staff due to
customer order pushouts and delays in production ramps. These
changes are expected to result in a total cost savings of over
$550,000 per quarter.
Fiscal First Quarter and Recent
Business Highlights:
- Shipped and Successfully Installed Initial System
for a Major New Customer in
Silicon Photonics – During the quarter,
Aehr shipped and successfully installed a FOX-NP TM system for
initial production burn-in and stabilization for a new customer who
is a global leader of communication transceivers for data centers,
telecom, and 5G infrastructure. This customer is forecasting to
transition to Aehr’s FOX-XP wafer-level test and burn-in systems
during this fiscal year to meet their volume production
forecast.
- Began Marketing and Sales Campaign
with the
World’s Largest
OSAT Supplier – During the quarter, Aehr
began an initial marketing and sales campaign with the world’s
largest Outsourced Semiconductor Assembly and Test (OSAT) supplier
for the FOX-PTM family of products including Aehr WaferPaks TM and
DiePaks® for production test, burn-in, and reliability screening of
devices at full wafer, singulated die, and module level. The
initial marketing and sales campaign has already resulted in
multiple new customer engagements.
- Broadened Deployment of the FOX-XP for
Silicon Carbide Devices – During
the quarter, Aehr added multiple new device design wins and
completed the initial production release of several new silicon
carbide devices on its FOX-XP full wafer level test and burn-in
system with its lead customer that is using the FOX-XP system for
high volume production burn-in and infant mortality screening of
silicon carbide devices at wafer level for electric vehicle power
modules.
- Silicon Photonics Ramps Forecast
Remains Strong – Although Aehr
experienced pushouts of customer forecasted orders in the first
quarter for its FOX-P systems and consumables in data center and
some 5G end use applications for silicon photonics transceivers,
these customers have indicated the push outs are temporary and that
they will require the additional system capacity and consumables
later in the current fiscal 2021 year.
- Potential upside in Mobile Sensor
Segment – Aehr has seen incremental
applications and devices that provide upside in this segment late
in fiscal 2021 and into 2022.
- Aehr Remains
Engaged with Over a Dozen New Potential Customers
– Aehr’s list of Tier 1 and Tier 2 customers that
are considering using Aehr’s products for high market growth
applications including silicon photonics and silicon carbide
production burn-in continued to grow in the first
quarter.
Gayn Erickson, President and CEO of Aehr Test
Systems, commented:
“While COVID-19 has created real challenges due to travel
restrictions and overall caution that resulted in delays of some
customer production ramps, we believe these delays are temporary
and do not impact the demand for our products or the attractiveness
of the key markets that we serve. We maintain our belief that we
will come out of this worldwide pandemic stronger than we went in
with more production customers, more applications, and higher value
products. Our key customers are serving some of the highest growth
markets including data centers, 5G infrastructure, sensors and
technology for smartphones and tablets, electric and hybrid
electric vehicles, and memory and data storage in computing, data
centers, mobile devices and hundreds of applications that are
keeping the world connected. As a result, we believe our products
will be in high demand this year and for years to come.
“We saw our silicon photonics customers move to production with
our FOX systems for the first time this past fiscal 2020, which
includes our lead customer and three additional silicon photonics
customers who have each told us that they expect to ramp production
during Aehr’s fiscal 2021, adding capacity in both systems and
consumables. During the quarter we shipped and installed a FOX-NP
TM system for initial production burn-in and stabilization for a
new customer in the silicon photonics space who is also forecasting
to transition to our FOX-XP wafer-level test and burn-in systems
during this fiscal year to meet their volume production
forecast.
“We continue to see the total available opportunity for silicon
carbide and silicon photonics wafer level and singulated die test
markets to be approximately $250 million of needed capacity
including consumables. We are currently engaged with over a dozen
potential Tier 1 and Tier 2 customers for both silicon photonics
and silicon carbide applications, and we expect several of these
potential customers to place initial orders this fiscal year, with
ramps into production later this fiscal year or in fiscal 2022. We
are also seeing renewed activity and interest for our FOX systems
and consumables for several new applications in the 2D and 3D
sensor markets, particularly for mobile devices, and believe this
could add to our currently forecasted revenue for this fiscal year
and next.
“Last quarter, we completed organizational changes to move to
more effective third party sales representatives in Europe and
Japan, and this quarter put in place temporary expense reductions
across the company in response to COVID-19 related delays in orders
and impacts on revenue. Together these changes will result in total
cost savings of almost $700,000 per quarter, lowering Aehr’s
revenue break even by approximately $4.5 million per year.
“As we continue into fiscal 2021, we remain optimistic about the
growth opportunities for our systems and consumables within our
installed base of customers, as well as our ability to expand the
number of customers using our family of FOX-P solutions. We expect
significant growth in both our top and bottom lines moving forward,
with much lower fixed operating expenses and significantly higher
margin products and services.”
Fiscal 2021 Financial Guidance:For the fiscal
year ending May 31, 2021, Aehr maintains its expected full year
total revenue to be between $25 million and $28 million, which
would represent growth between 12% and 26% year over year, and to
be profitable for the fiscal year.
Management Conference Call and
WebcastAehr Test Systems will host a conference call and
webcast today at 5:00 p.m. Eastern (2:00 p.m. PT) to discuss its
first quarter fiscal 2021 operating results. To access the call
dial 800-353-6461 (+1 334-323-0501 outside the United States) and
give the participant pass code 9822939. 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. 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 October 1, 2020. To access the replay
dial-in information, please click here.
About Aehr Test SystemsHeadquartered 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 ABTSTM and FOX-PTM
families of test and burn-in systems and FOX WaferPakTM Aligner,
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 StatementThis 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 Aehr’s 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," or "continue," or
the negative of these words or other similar terms or expressions
that concern Aehr’s expectations, strategy, priorities, plans, or
intentions. Forward-looking statements in this press release
include, but are not limited to, statements regarding the temporary
nature of customer pushouts and customer needs for additional
system capacity and consumables in fiscal year 2021; Aehr’s total
cost savings related to temporary expense reductions and the impact
of Aehr’s restructuring on its ability to achieve higher future
profitability; customer transitions to new product offerings based
on volume production forecasts; potential upside in the mobile
sensor segment due incremental applications and devices; the
ability of current awareness and adoption rates to drive the
markets for silicon carbide and silicon photonics to move to wafer
level or singulated die burn-in; customer capacity needs forecasts
related to Aehr’s products; our expectations related to the timing
and volume of our lead customer’s future purchases; the total
available opportunity for silicon carbide and silicon photonics
wafer level and singulated die test markets; expectations regarding
the timing and occurrence of orders of potential and existing
customers and the related impact on Aehr’s forecasted revenues;
cost savings related to organizational changes to third party sales
representation in Europe and Japan; the impact of the COVID-19
pandemic on Aehr’s production, customers, applications, product
value, and demand for Aehr’s products this year and in future
years; growth in systems and consumables within Aehr’s installed
base of customers and expansion of the number of customer’s in
Aehr’s FOX-P solutions; Aehr’s top and bottom line growth, lower
fixed operating expenses and higher margin products and services in
2021; and Aehr’s revenue in fiscal 2021. The forward-looking
statements contained in this press release are also subject to
other risks and uncertainties, including those more fully described
in Aehr’s recent 10-K, 10-Q and other reports from time to time
filed 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.
Contacts:
Aehr Test Systems |
MKR Investor Relations Inc. |
Ken Spink |
Todd Kehrli or Jim Byers |
Chief Financial Officer |
Analyst/Investor Contact |
(510) 623-9400 x309 |
(323) 468-2300 |
|
aehr@mkr-group.com |
– Financial Tables to Follow
–
|
AEHR TEST
SYSTEMS AND SUBSIDIARIES |
Condensed
Consolidated Statements of Operations |
(in thousands,
except per share data) |
(unaudited) |
|
|
|
|
|
|
|
Three Months Ended |
|
Aug 31, |
|
May 31, |
|
Aug 31, |
|
2020 |
|
2020 |
|
2019 |
|
|
|
|
|
|
Net sales |
$ |
2,012 |
|
|
$ |
3,773 |
|
|
$ |
5,533 |
|
Cost of
sales |
|
1,785 |
|
|
|
3,866 |
|
|
|
3,262 |
|
Gross profit
(loss) |
|
227 |
|
|
|
(93 |
) |
|
|
2,271 |
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
Selling, general and administrative |
|
1,514 |
|
|
|
1,674 |
|
|
|
1,808 |
|
Research and development |
|
900 |
|
|
|
854 |
|
|
|
892 |
|
Restructuring |
|
- |
|
|
|
220 |
|
|
|
- |
|
Total operating expenses |
|
2,414 |
|
|
|
2,748 |
|
|
|
2,700 |
|
|
|
|
|
|
|
Loss from operations |
|
(2,187 |
) |
|
|
(2,841 |
) |
|
|
(429 |
) |
|
|
|
|
|
|
Interest
(expense) income, net |
|
(13 |
) |
|
|
(17 |
) |
|
|
12 |
|
Net gain
from dissolution of Aehr Test Systems Japan |
|
2,186 |
|
|
|
- |
|
|
|
- |
|
Other
(expense) income, net |
|
(94 |
) |
|
|
(17 |
) |
|
|
10 |
|
|
|
|
|
|
|
Loss before income tax
benefit (expense) |
|
(108 |
) |
|
|
(2,875 |
) |
|
|
(407 |
) |
|
|
|
|
|
|
Income tax
benefit (expense) |
|
215 |
|
|
|
(10 |
) |
|
|
(6 |
) |
|
|
|
|
|
|
Net income (loss) |
|
107 |
|
|
|
(2,885 |
) |
|
|
(413 |
) |
|
|
|
|
|
|
Less: Net
income attributable to the |
|
|
|
|
|
noncontrolling interest |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
Net income (loss)
attributable to Aehr |
|
|
|
|
|
Test Systems common shareholders |
$ |
107 |
|
|
$ |
(2,885 |
) |
|
$ |
(413 |
) |
|
|
|
|
|
|
Net income
(loss) per share |
|
|
|
|
|
Basic |
$ |
0.00 |
|
|
$ |
(0.13 |
) |
|
$ |
(0.02 |
) |
Diluted |
$ |
0.00 |
|
|
$ |
(0.13 |
) |
|
$ |
(0.02 |
) |
|
|
|
|
|
|
Shares used
in per share calculations: |
|
|
|
|
|
Basic |
|
23,248 |
|
|
|
23,060 |
|
|
|
22,708 |
|
Diluted |
|
23,455 |
|
|
|
23,060 |
|
|
|
22,708 |
|
|
|
|
|
|
|
AEHR TEST
SYSTEMS AND SUBSIDIARIES |
Reconciliation of GAAP to Non-GAAP Results |
(in thousands,
except per share data) |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Aug 31, |
|
May 31, |
|
Aug 31, |
|
2020 |
|
2020 |
|
2019 |
|
|
|
|
|
|
GAAP net income (loss) |
$ |
107 |
|
|
$ |
(2,885 |
) |
|
$ |
(413 |
) |
Stock-based
compensation expense |
|
270 |
|
|
|
300 |
|
|
|
199 |
|
Restructuring |
|
- |
|
|
|
220 |
|
|
|
- |
|
Dissolution
of Aehr Test Systems Japan |
|
(2,401 |
) |
|
|
- |
|
|
|
- |
|
Excess and
obsolescence provision |
|
- |
|
|
|
1,645 |
|
|
|
- |
|
Non-GAAP net
loss |
$ |
(2,024 |
) |
|
$ |
(720 |
) |
|
$ |
(214 |
) |
|
|
|
|
|
|
GAAP net
income (loss) per diluted share |
$ |
0.00 |
|
|
$ |
(0.13 |
) |
|
$ |
(0.02 |
) |
Non-GAAP net
loss per diluted share |
$ |
(0.09 |
) |
|
$ |
(0.03 |
) |
|
$ |
(0.01 |
) |
Shares used
in GAAP diluted shares calculation |
|
23,455 |
|
|
|
23,060 |
|
|
|
22,708 |
|
Shares used
in non-GAAP diluted shares calculation |
|
23,248 |
|
|
|
23,060 |
|
|
|
22,708 |
|
|
|
|
|
|
|
|
Non-GAAP net loss is a
non-GAAP measure and should not be considered a replacement for
GAAP results. Non-GAAP net loss is a financial measure the Company
uses to evaluate the underlying results and operating performance
of the business. The limitation of this measure is that it excludes
items that impact the Company's current period net income. This
limitation is best addressed by using this measure in combination
with net income (loss) (the most directly comparable GAAP financial
measure). These measures are not in accordance with GAAP and may
differ from non-GAAP methods of accounting and reporting used by
other companies. We believe these measures enhance investors’
ability to review the company’s business from the same perspective
as the Company’s management and facilitate comparisons of this
period’s results with prior periods. |
|
|
|
|
AEHR TEST
SYSTEMS AND SUBSIDIARIES |
Condensed
Consolidated Balance Sheets |
(in thousands) |
(unaudited) |
|
|
|
|
|
August 31, |
|
May 31, |
|
2020 |
|
2020 |
ASSETS |
|
|
|
|
|
|
|
Current
assets: |
|
|
|
Cash and cash equivalents |
$ |
6,313 |
|
$ |
5,433 |
|
Accounts receivable, net |
|
1,116 |
|
|
3,717 |
|
Inventories |
|
8,102 |
|
|
7,989 |
|
Prepaid expenses and other |
|
439 |
|
|
512 |
|
Total current assets |
|
15,970 |
|
|
17,651 |
|
|
|
|
|
Property and
equipment, net |
|
622 |
|
|
663 |
|
Operating
lease right-of-use assets |
|
1,952 |
|
|
2,107 |
|
Other
assets |
|
147 |
|
|
153 |
|
Total assets |
$ |
18,691 |
|
$ |
20,574 |
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
Current
liabilities: |
|
|
|
Current portion of long-term debt |
$ |
933 |
|
$ |
653 |
|
Accounts payable |
|
809 |
|
|
945 |
|
Accrued expenses |
|
1,373 |
|
|
1,439 |
|
Operating lease liabilities, short-term |
|
671 |
|
|
658 |
|
Customer deposits and deferred revenue, short-term |
|
387 |
|
|
170 |
|
Total current liabilities |
|
4,173 |
|
|
3,865 |
|
|
|
|
|
Long-term
debt, net of current portion |
|
746 |
|
|
1,026 |
|
Lease
liability long-term portion |
|
1,432 |
|
|
1,605 |
|
Deferred
revenue, long-term |
|
19 |
|
|
22 |
|
Total liabilities |
|
6,370 |
|
|
6,518 |
|
|
|
|
|
Aehr Test
Systems shareholders' equity |
|
12,321 |
|
|
14,077 |
|
Noncontrolling interest |
|
- |
|
|
(21 |
) |
Total shareholders' equity |
|
12,321 |
|
|
14,056 |
|
Total liabilities and
shareholders' equity |
$ |
18,691 |
|
$ |
20,574 |
|
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