Aehr Test Systems Stock Dives Over 12% on Mixed Q1 Earnings Report
Despite a revenue beat, the semiconductor equipment supplier's net loss and missed earnings per share estimates sent shares tumbling in after-hours trading.
Shares of Aehr Test Systems (NASDAQ: AEHR) plunged more than 12% in after-hours trading Monday after the company released a mixed first-quarter earnings report that left investors concerned despite a headline revenue beat. The semiconductor testing and reliability equipment supplier announced Q1 revenue of nearly $11.0 million, .
However, the top-line beat was overshadowed by the company's bottom-line performance. Aehr Test Systems reported a GAAP net loss of $(0.07) per share, a significant miss that rattled the market. The company's adjusted earnings per share were in line with expectations at one cent, but the GAAP loss appeared to be the primary catalyst for the sharp sell-off.
Despite the negative market reaction, Aehr's management highlighted several positive developments in the quarter. The company reported a strong increase in bookings, which reached $11.4 million, and a total backlog of $15.5 million as of August 29. CEO Gayn Erickson expressed optimism about the company's trajectory, particularly its growing role in the artificial intelligence sector. "We are very pleased with the start to our new fiscal year," Erickson said, citing strong customer engagement and growing momentum in the testing of AI processors.
The mixed results have drawn a varied response from market analysts, with a general consensus leaning towards a "Hold" or "Moderate Buy" rating. reflect this cautious optimism, with price targets showing a wide range of potential outcomes. The company's strategic focus on high-growth areas like AI and silicon carbide is a key part of its long-term bull case, but management has withheld formal guidance for fiscal 2026, citing ongoing uncertainties related to tariffs that could affect the timing of new orders.
Investors will be closely watching for further signs of strength in the AI and silicon carbide markets, as well as any updates on the tariff situation, to gauge the company's future performance. While the after-hours drop was significant, the suggest that underlying demand for Aehr's products remains robust, setting the stage for a potential rebound if the company can navigate the current headwinds and deliver on its growth promises.