# Aehr Test Systems (AEHR.US)

Canonical: https://gigainvestors.com/s/AEHR

Analysis as of: 2026-10-16T07:26:15.217Z. Financial observations: FY1997–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: fail; earnings resilience is evidence only). Published buy qualification: no.

Share price: $69.21 per share; close as of 2026-10-15.

Estimated value: low $6.70 per share, central $7.14 per share, high $7.72 per share. Buy at or below the central value $7.14 per share. Valuation as of 2026-10-16T07:26:15.217Z; scenarios are not confidence intervals.

Expected annual return: 3.4% at the stated quote. About 3.4% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: fail

- 4 revenue declines in the last 10 years (informational)

- more than 2 net loss years

- negative average operating margin

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 4

- Years with a net loss: 6

- Operating margin variation: 2.78×

Chart: Operating margin; fiscal year observations.

- FY2017: -0.26×

- FY2018: 0.03×

- FY2019: -0.20×

- FY2020: -0.11×

- FY2021: -0.25×

- FY2022: 0.15×

- FY2023: 0.21×

- FY2024: 0.15×

- FY2025: -0.07×

- FY2026: -0.28×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: -7.2%

- ROIC, second-lowest year: -33.6%

- Typical minus recent gross margin: 3.8 pp

- Typical gross margin (annual median): 39.1%

- Recent gross margin (lower of latest and 3-year median): 35.3%

- Years with nonpositive capital: 0

- Capital spending / revenue: 1.7%

- ROIC including acquisitions, ten-year median: -5.0%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2017: -75.0%

- FY2018: 10.7%

- FY2019: -33.6%

- FY2020: -16.0%

- FY2021: -28.3%

- FY2022: 37.7%

- FY2023: 39.2%

- FY2024: 14.7%

- FY2025: -3.5%

- FY2026: -10.9%

### economics: fail

- incremental invested capital return below threshold

- working capital as a share of revenue rose more than 10pp and ends positive

- Owner earnings / net income, 5-yr: 1.01×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $47M

- Net income, five-year total: $46M

- Return on incremental invested capital: -13.6%

- Working capital / revenue, annual change: 5.9 pp

- Working capital / revenue, change between three-year averages: 41.7 pp

- Working capital / revenue, final three-year average: 85.9%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2022: 1.00×

- FY2023: 1.00×

- FY2024: 1.02×

- FY2025: 1.41×

- FY2026: 0.79×

### management: fail

- Historical market-dollar context (not the management verdict): 2017 to 2026 (9 years)

- potential debt-funded buybacks (informational)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: -33.6% vs -3.5%

- Per-share earnings: -0.35 to -0.13 (three-year endpoint medians)

- per-share value declined or ends nonpositive

- five-year and ten-year diluted share growth both above threshold

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 8.9%

- Ordinary dilution, 5-year annual growth: 5.5%

- Market cap gain: $2.9B

- Cumulative retained earnings: $37M

- Diluted shares, 10-year annual growth: 8.9%

- Diluted shares, 5-year annual growth: 5.5%

- $1 test, starting fiscal year: FY2017

- $1 test, ending fiscal year: FY2026

- Per-share value change: $0.22

- Per-share value, starting three-year median: -$0.35

- Per-share value, ending three-year median: -$0.13

- Buybacks concentrated in cheaper years (correlation): 0.75

- Average buyback yield: 0.2%

- Buyback history: 7 years

- Debt-funded buybacks: Yes

- Acquisition spending: $22M

- Cumulative net income, 10 years: $31M

- ROIC, first three-year median: -33.6%

- ROIC, last three-year median: -3.5%

Chart: Earnings per share; fiscal year observations.

- FY2017: -$0.35

- FY2018: $0.02

- FY2019: -$0.23

- FY2020: -$0.12

- FY2021: -$0.09

- FY2022: $0.34

- FY2023: $0.50

- FY2024: $1.12

- FY2025: -$0.13

- FY2026: -$0.23

### accounting: pass

- Sloan accruals: -1.5%

- Receivables to sales index (DSRI): 1.16×

- Restructuring years, last five: 0

- Earnings backed by cash: Yes

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.09×

Chart: Sloan accruals; fiscal year observations.

- FY2017: -3.7%

- FY2018: 6.1%

- FY2019: 1.9%

- FY2020: -3.8%

- FY2021: 3.1%

- FY2022: 12.7%

- FY2023: 4.6%

- FY2024: 24.5%

- FY2025: 2.4%

- FY2026: -1.5%

## Holders

- [Dan Davidowitz](https://gigainvestors.com/pcm): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Down 31% since Sep 2026 · "Aehr Test Systems jumps 30% on record bookings, projects revenue up to 3x" (seekingalpha.com, Jul 2026) · sales -15.2%

Story as of 2026-10-16T09:58:14.792Z; price observation 2026-10-15.

Price needs cash profits to grow 39.5% a year for ten years

- 2025-07-22: Aehr Test Systems receives follow-on orders for AI processor testing ([investing.com](https://www.investing.com/news/company-news/aehr-test-systems-receives-followon-orders-for-ai-processor-testing-93CH-4145657))

- 2025-08-26: Aehr Test (AEHR) Soars 42% on New Supply Deal With Giant Hyperscaler ([finance.yahoo.com](https://finance.yahoo.com/news/aehr-test-aehr-soars-42-161942669.html))

- 2025-10-07: Aehr Test Systems falls as tariff concerns delay guidance reinstatement ([seekingalpha.com](https://seekingalpha.com/news/4502206-aehr-test-systems-falls-as-tariff-concerns-delay-guidance-reinstatement?utm_source=feed_news_all&utm_medium=referral&feed_item_type=news))

- 2026-01-09: Aehr reinstates fiscal 2026 guidance, targets $25M–$30M revenue amid strong AI-driven bookings outlook ([seekingalpha.com](https://seekingalpha.com/news/4537928-aehr-reinstates-fiscal-2026-guidance-targets-25m-30m-revenue-amid-strong-ai-driven-bookings?utm_source=feed_news_all&utm_medium=referral&feed_item_type=news))

- 2026-02-16: AEHR's +25% Spike: Latest AI Hyperscaler Order Improves Outlook ([finance.yahoo.com](https://finance.yahoo.com/news/aehrs-25-spike-latest-ai-234200966.html))

- 2026-04-08: Aehr targets high side of $45M-$50M FY2026 revenue as effective backlog reaches $50.9M ([seekingalpha.com](https://seekingalpha.com/news/4573152-aehr-targets-high-side-of-45m-50m-fy2026-revenue-as-effective-backlog-reaches-50_9m?utm_source=feed_news_all&utm_medium=referral&feed_item_type=news))

### Sales · FY2025–2026

sales -15.2%; source https://www.sec.gov/Archives/edgar/data/1040470/000165495426006919/aehr_10k.htm; observed 2026-07-27.

- FY2017: $19M 

- FY2018: $30M 

- FY2019: $21M 

- FY2020: $22M 

- FY2021: $17M 

- FY2022: $51M 

- FY2023: $65M 

- FY2024: $66M 

- FY2025: $59M 

- FY2026: $50M 

### Gross margin · FY2026

gross margin 35.3%; source https://www.sec.gov/Archives/edgar/data/1040470/000165495426006919/aehr_10k.htm; observed 2026-07-27.

- FY2017: 35.9% 

- FY2018: 41.9% 

- FY2019: 36.1% 

- FY2020: 37.6% 

- FY2021: 36.3% 

- FY2022: 46.6% 

- FY2023: 50.4% 

- FY2024: 49.1% 

- FY2025: 40.6% 

- FY2026: 35.3% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in semiconductor equipment & materials; annual sales are USD 50 million.

- Source: https://www.sec.gov/Archives/edgar/data/1040470/000165495426006919/aehr_10k.htm (filed 2026-07-27); FY2026: revenue 50001000; grossProfit 17651000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-15); AEHR.US: Aehr Test Systems, Inc. provides test solutions for testing, burn-in, and semiconductor devices at wafer level, singulated die, and package level in the United States, Asia, Europe, and the Middle East. The company offers FOX-XP and FOX-NP systems, which are full wafer contact and singulated die/module test and burn-in systems that test, burn-in, and stabilize a range of devices, including silicon carbide-based (SIC) and gallium nitride (GAN) power semiconductors; 2D and 3D sensors used in mobile phones, tablets, and other computing devices; memory semiconductors; processors; microcontrollers; systems-on-a-chip; and photonics and integrated optical devices used in AI. It also provides the FOX-CP system, a single-wafer compact test solution for logic, memory, and photonic devices; and the FOX WaferPak Contactor, a full wafer contactor capable of testing wafers up to 300mm that enables integrated circuit manufacturers to perform test, burn-in, and stabilization of full wafers on the FOX-P systems. In addition, the company offers the FOX DiePak Carrier, which allows testing, burn-in, and stabilization of singulated bare die and modules; FOX WaferPak Aligner; and FOX DiePak Loader. Further, it provides system installation and repair, applications engineering support, spare parts inventories, customer training, and documentation services. The company sells its products in the United States, Germany, Japan, the Philippines, and Taiwan through distributors and sales representatives. It serves semiconductor manufacturers, semiconductor contract assemblies, electronics manufacturers, and burn-in and test service companies. Aehr Test Systems, Inc. was incorporated in 1977 and is headquartered in Fremont, California.

### Why customers stay

Margins ranged from 35.3% to 49.1% during 2024–26; it lost 7.2% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-07-27); FY2024: grossProfit / revenue = 49.1%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-07-27); FY2025: grossProfit / revenue = 40.6%.

- Source: https://www.sec.gov/Archives/edgar/data/1040470/000165495426006919/aehr_10k.htm (filed 2026-07-27); FY2026: grossProfit / revenue = 35.3%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-07-27); 10-year return on capital observations [[2017,-0.7504162651763345],[2018,0.10680518267771683],[2019,-0.33624551971326166],[2020,-0.16001193792280144],[2021,-0.2826159110350727],[2022,0.37665668580104095],[2023,0.39184826797751854],[2024,0.14684326324838629],[2025,-0.0348559123505161],[2026,-0.10924694084991594]]; median -0.07205142660021602. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 3 of 10 years; bought back USD 2.4 million of shares.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-07-27); FY2018: growth capex 155000; upkeep 417000; owner earnings 528000. Growth capex / owner earnings = 0.2935606060606061.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-07-27); FY2022: growth capex 109000; upkeep 307000; owner earnings 9450000. Growth capex / owner earnings = 0.011534391534391534.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-07-27); FY2023: growth capex 912000; upkeep 450000; owner earnings 14557000. Growth capex / owner earnings = 0.06265027134711823.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-07-27); FY2024: growth capex 0; upkeep 749000; owner earnings 33770000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-07-27); Dividend observations: [[2017,0],[2018,0],[2019,0],[2020,1679000],[2021,1400000],[2022,1400000],[2023,0],[2024,0],[2025,0],[2026,0]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://www.sec.gov/Archives/edgar/data/1040470/000165495426006919/aehr_10k.htm (filed 2026-07-27); FY2026: cash repurchases 2364000 USD.

### Are managers owners

Insiders own 3.3% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-15); AEHR.US SharesStats.PercentInsiders = 3.299 percentage points; cache date 2026-10-15.

### What could break it

US import tariffs could raise product costs.

- Source: https://www.sec.gov/Archives/edgar/data/1040470/000165495426006919/aehr_10k.htm (filed 2026-07-27); ervices, as well as by the integration and contribution of the acquired business. Because these factors can affect revenue levels, gross margins, operating expenses, and working capital differently from period to period, past performance may not necessarily be indicative of future results. Our liquidity and cash flows may also be affected by the timing of large system shipments, investments in inventory and working capital, capital expenditures, acquisition-related cash uses, and investments in product development and market expansion.

25

Tab le of Contents

Recent changes in U.S. trade and tariff policies, including potential modifications to existing tariffs and the outcome of ongoing regulatory, administrative, or legal developments, may affect the cost of our imported goods, our supply chain, and, accordingly, our gross margins and operating results. The scope, timing, and ultimate impact of these developments remain uncertain, and we continue to evaluate their potential effects on our business, financial condition, and results of operations.

Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to revenues, inventories, income taxes, the business combination with Incal, and the impairment of goodwill and long-lived assets, among others. Our estimates are derived from historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Those results form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

We believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our consolidated financial statements.

Revenue Recognition

We recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services by following a five-step process: (1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price, and (5) recognize revenue when or as we satisfy a performance obligation

### What the price says

The price assumes cash profits grow 39.5% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-07-27); Ten-year compound average after fade. Initial solved rate 0.5731829771262826. Price 69.21; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2016 owner earnings/share -0.5588844406184703 → FY2026 -0.1846163878835306. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $3.45 per share

- 2016-11: $2.99 per share

- 2016-12: $2.41 per share

- 2017-01: $2.36 per share

- 2017-02: $5.24 per share

- 2017-03: $4.81 per share

- 2017-04: $4.57 per share

- 2017-05: $4.58 per share

- 2017-06: $3.75 per share

- 2017-07: $4.04 per share

- 2017-08: $3.36 per share

- 2017-09: $4.09 per share

- 2017-10: $3.61 per share

- 2017-11: $2.55 per share

- 2017-12: $2.71 per share

- 2018-01: $2.60 per share

- 2018-02: $2.29 per share

- 2018-03: $2.25 per share

- 2018-04: $2.32 per share

- 2018-05: $2.60 per share

- 2018-06: $2.35 per share

- 2018-07: $2.31 per share

- 2018-08: $2.53 per share

- 2018-09: $2.22 per share

- 2018-10: $1.92 per share

- 2018-11: $1.88 per share

- 2018-12: $1.41 per share

- 2019-01: $1.25 per share

- 2019-02: $1.46 per share

- 2019-03: $1.38 per share

- 2019-04: $1.60 per share

- 2019-05: $1.75 per share

- 2019-06: $1.65 per share

- 2019-07: $1.31 per share

- 2019-08: $1.34 per share

- 2019-09: $1.79 per share

- 2019-10: $1.67 per share

- 2019-11: $1.89 per share

- 2019-12: $2.00 per share

- 2020-01: $2.05 per share

- 2020-02: $2.10 per share

- 2020-03: $1.67 per share

- 2020-04: $1.74 per share

- 2020-05: $1.65 per share

- 2020-06: $1.96 per share

- 2020-07: $2.05 per share

- 2020-08: $1.78 per share

- 2020-09: $1.39 per share

- 2020-10: $1.22 per share

- 2020-11: $1.65 per share

- 2020-12: $2.53 per share

- 2021-01: $2.29 per share

- 2021-02: $2.80 per share

- 2021-03: $2.52 per share

- 2021-04: $2.26 per share

- 2021-05: $2.25 per share

- 2021-06: $2.76 per share

- 2021-07: $5.62 per share

- 2021-08: $7.46 per share

- 2021-09: $13.65 per share

- 2021-10: $22.62 per share

- 2021-11: $17.42 per share

- 2021-12: $24.18 per share

- 2022-01: $12.75 per share

- 2022-02: $13.60 per share

- 2022-03: $10.16 per share

- 2022-04: $7.68 per share

- 2022-05: $8.38 per share

- 2022-06: $7.50 per share

- 2022-07: $11.41 per share

- 2022-08: $14.54 per share

- 2022-09: $14.10 per share

- 2022-10: $20.57 per share

- 2022-11: $26.07 per share

- 2022-12: $20.10 per share

- 2023-01: $34.96 per share

- 2023-02: $33.35 per share

- 2023-03: $31.02 per share

- 2023-04: $24.75 per share

- 2023-05: $33.02 per share

- 2023-06: $41.25 per share

- 2023-07: $52.16 per share

- 2023-08: $51.01 per share

- 2023-09: $45.70 per share

- 2023-10: $23.56 per share

- 2023-11: $22.96 per share

- 2023-12: $26.53 per share

- 2024-01: $14.85 per share

- 2024-02: $16.27 per share

- 2024-03: $12.40 per share

- 2024-04: $11.98 per share

- 2024-05: $11.51 per share

- 2024-06: $11.17 per share

- 2024-07: $18.87 per share

- 2024-08: $15.21 per share

- 2024-09: $12.85 per share

- 2024-10: $14.08 per share

- 2024-11: $11.89 per share

- 2024-12: $16.63 per share

- 2025-01: $11.33 per share

- 2025-02: $9.64 per share

- 2025-03: $7.29 per share

- 2025-04: $8.53 per share

- 2025-05: $9.54 per share

- 2025-06: $12.93 per share

- 2025-07: $16.90 per share

- 2025-08: $24.95 per share

- 2025-09: $30.11 per share

- 2025-10: $25.99 per share

- 2025-11: $22.97 per share

- 2025-12: $20.19 per share

- 2026-01: $25.64 per share

- 2026-02: $37.43 per share

- 2026-03: $37.08 per share

- 2026-04: $90.56 per share

- 2026-05: $92.33 per share

- 2026-06: $96.06 per share

- 2026-07: $79.98 per share

- 2026-08: $79.27 per share

- 2026-09: $99.62 per share

- 2026-10: $69.21 per share

## Annual estimated value (USD per share)

- FY2024: low $6.55 per share, central $7.75 per share, high $8.77 per share

- FY2025: low $5.83 per share, central $7.94 per share, high $9.18 per share

- FY2026: low $7.07 per share, central $7.53 per share, high $8.14 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/1040470/000165495426006919/aehr_10k.htm); period 2026-05-29, filed 2026-07-27.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.