Why Aehr Test Systems Stock Zoomed 16% Higher Today
Key Points
It reported robust sales of an AI-focused product.
That clutch of orders surpassed its Sonoma take for the entire previous quarter.
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News of a new and lucrative set of orders for artificial intelligence (AI) processor diagnostic products boosted Aehr Test Systems' (NASDAQ: AEHR) share price on Thursday. It also helped divert investor attention away from a fairly lackluster quarterly earnings report published by the company.
$5.5 million worth of good news
Aehr announced that it had received a series of orders from multiple customers for its Sonoma AI diagnostic systems. All told, those orders total over $5.5 million. It did not identify those clients, saying only they were "leading-edge AI companies," and a "premier Bay Area lab."
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Aehr didn't hesitate to mention that this set of Sonoma orders in its current (third) quarter to date already exceeds the total for the product in all of the previous quarter.
Speaking of that period, Aehr released its second-quarter fiscal 2026 results. Its net revenue sank on a year-over-year basis to $9.9 million from $13.5 million. On the bottom line, the company flipped to a net loss not in accordance with generally accepted accounting principles (GAAP) of $1.3 million, or $0.04 per share, against the year-ago profit of $700,000.
Guidance reinstated
Any disappointment investors felt about these numbers was mitigated, to an extent, by Aehr's reinstatement of its guidance; it had stopped providing such projections last summer, beginning with its fourth quarter of fiscal 2025 results.
The company said it's expecting revenue of $25 million to $30 million, and a non-GAAP (adjusted) net loss of $0.05 to $0.09 per share for the second half of this fiscal year.
News of those fresh orders is definitely encouraging, but I think investors should curb their enthusiasm somewhat. It feels to me that Aehr should be doing better already, given the insatiably strong demand for AI technology. I'd hold off on buying it until it can prove that it can grow its fundamentals consistently.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
