Testing Equipment
AEHR Fiscal Q2 Pre-Earnings: The Pressure is ON
During Q1 earnings, management reiterated the FY 2024 guidance of at least $100 million, representing over 50% year-over-year growth. Since that earnings report, AEHR’s largest customer, ON Semi, provided a guide on SiC for 2023 that is 20% lower than the original guidance. As a reminder, ON is about 80% of AEHR’s revenue, and we’ve pointed out in nearly every write-up on the stock that customer concentration is the primary risk. Quick math indicates that if ON misses by 20% on SiC, then AEHR would miss by about $16M if we figure $80M of AEHR’s revenue is from ON Semi. The risk that is involved with such high customer concentration is what the market is reacting to, but ON Semi’s call was not as bad as it sounds.
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