Aehr Test Systems
NASDAQ:AEHR
Earnings Call Analysis
Q2-2024 Analysis
Aehr Test Systems
Aehr Test Systems, specializing in wafer-level testing and burn-in for silicon carbide (SiC) and gallium nitride (GaN) devices, has shown significant progress in expanding its customer base. With 7 customers already purchasing solutions and engagements with over two dozen companies, they are aiming to have over 12 SiC/GaN customers by the end of 2024. The company stands as a leader in the market, never losing a full wafer-level burn-in evaluation since introducing their FOX systems. The demand for SiC devices is expanding beyond electric vehicles to industrial, solar, and commuter electric trains markets. Aehr's unique WaferPak contactors and FOX system are pivotal for high-volume production and are increasingly adopted as electric vehicles introduce new inverter and charger designs. These developments contribute to Aehr's recurrent revenue model and solid growth projections in the semiconductor test markets.
Aehr announced impressive year-over-year growth in revenue and net income, with Q2 revenue up by 45% at $21.4 million. Despite a slight decrease in gross margin due to higher costs and increased operational expenses related to enhanced sales, marketing, and R&D efforts, the company reported robust GAAP gross margins at over 51%. The investments in R&D have been critical to maintaining Aehr's competitive edge and expanding its market opportunities. The company sits on a stronghold of cash reserves, boasting $50.5 million, enabling continued investments in growth and infrastructure. With the strong balance sheet, Aehr can swiftly respond to customer orders despite a lower book-to-bill ratio. The company offers a conservative fiscal outlook for 2024, projecting a total revenue between $75 million and $85 million, indicating a 15% to 30% growth, alongside a GAAP net income of 20% to 25% of revenue, portraying cautious optimism for the future.
Aehr Test Systems acknowledges shifts in customer order timings which have impacted their forecasts. Notably, their capacity to exceed $100 million in revenue remains intact, should customers elect to accelerate their purchasing. The company also emphasizes its capability to grow alongside the SiC market, which is expected to progress at approximately 40% per year. The mix of customer demands and product applications, especially the adoption of WaferPaks for novel semiconductor designs, promise ongoing revenue streams, irrespective of the growth rate in device production or shifts in customer purchasing patterns. Looking further ahead, Aehr Test Systems also projects engagement in the rapidly growing Chinese EV market, signifying its readiness to capitalize on emerging international opportunities and diversify its customer base.
You don't have any saved screeners yet
Greetings, and welcome to the Aehr Test Systems Second Quarter Financial 2024 Financial Results Call. [Operator Instructions] Please note, this conference is being recorded.I will now turn the conference over to your host Jim Byers of MKR Investor Relations. Jim, you may begin.
Thank you, operator. Good afternoon and welcome to Aehr Test Systems second quarter fiscal 2024 financial results conference call. With me on today's call are Aehr Test Systems' President and Chief Executive Officer, Gayn Erickson; and Chief Financial Officer, Chris Siu.Before I turn the call over to Gayn and Chris, I'd like to cover a few quick items. This afternoon, right after market close, Aehr Test issued a press release announcing its fiscal 2024 second quarter results. That release is available on the company's website at aehr.com. This call is being broadcast live over the Internet for all interested parties, and the webcast will be archived on the Investor Relations page of the company's website.I'd like to remind everyone that on today's call, management will be making forward-looking statements that are based on current information and estimates and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Those factors that could cause actual results to differ materially from those in the forward-looking statements are discussed in the company's most recent periodic and current reports filed with the SEC. These forward-looking statements, including guidance provided during today's call, are only valid as of this date. And Aehr Test undertakes no obligation to update the forward-looking statements.And now with that, I'd like to turn the conference call over to Gayn Erickson, President and CEO.
Thanks, Jim. Good afternoon, everyone, and welcome to our second quarter of fiscal '24 earnings conference call. Thanks for joining us today.We'll start with a quick summary of the highlights of the quarter and the continued momentum we're experiencing in the semiconductor wafer-level test and burn-in markets. Then Chris will go over the financials in more detail. After that, we'll open-up the lines to take your questions.We had another solid quarter with strong year-over-year growth in revenue and net income, both ahead of consensus estimates. Revenue for the quarter was $21.4 million, an increase of 45% year-over-year. And we generated non-GAAP net income of $6.7 million, slightly over 31% net profit.For the first half of the fiscal year, we grew revenue 65% over the same period last year. We continue to see increased demand for our wafer-level burn-in products and remain confident about the future demand for our unique technology solutions and the multiple market opportunities they address.In just the last 60 days, we've seen how the slowing of the growth rate of the electric vehicle market has had a negative impact on the timing of several current and new customer orders and capacity increases for silicon carbide devices used in them.For clarity, we do not see the silicon carbide market actually decreasing, only a slowing of the growth rate, and we've seen delays in both current customer and new customer purchase orders for production ramps to meet those electric vehicle demand, compared to what we're expecting even within the last several weeks and days.I'll discuss more detail on our new customer engagements, but a very large customer that we've been engaged with on a significant automotive benchmark in particular has modified their timing for taking multiple production systems, which we feel most likely pushes them out of this fiscal year and is reflected in our lowered revenue forecast for this fiscal year.Recent announcements from some automotive semiconductor suppliers of slowing growth due to their customers' stockpiling parts, suggest that the automotive semiconductor slowdown may be due in part to a temporary excess in inventory, but in addition to slowing sales of automobiles worldwide related to overall caution by automotive buyers due to increased interest rates and its impact on new auto sales.Multiple companies we're engaged with are large suppliers of automotive semiconductors, and they have put in place temporary cost control measures that have trickled down to even silicon carbide plans, which we have heard are the area least impacted due to the expected growth that is forecasted by their customers. As a result, we've seen delays in customer ramps and capacity expansion plans, which has resulted in delays in expected existing and new customer orders for our products.We're also experiencing the impact of shifts in our customers' product mix, which specifically includes an increase in WaferPak wafer contactors for our largest customer. As our customers shift from one design to another, they will order additional WaferPaks from us to be able to test and burn in those wafers. In the case of a large shift in the customer mix, this can be a very large number of WaferPaks.Our largest customers' overall forecast for revenue with us has actually remained relatively flat for the year, but the revenue mix has shifted to fewer systems and more WaferPaks.Given the latest forecast from our customers and uncertainty on the timing of their orders, we believe it makes sense to take a more conservative approach to our fiscal year forecast and have reduced our growth estimates for fiscal '24 revenue. We're reducing our revenue expectations of at least $100 million this fiscal year by 15% to 25% to a range of $75 million to $85 million in revenue.This is still a growth rate of 15% to 30% year over year. Despite this uncertainty in timing of orders, we remain confident about the future demand of our unique semiconductor test solutions in the markets they address. We have not reduced our growth expectations for the years ahead, where we continue to see tremendous opportunity.We continue to hear from our current customers as well as companies we're engaged in evaluations with that wafer-level burn-in is critical to their product roadmaps to address multiple large and growing markets, including battery and hybrid electric vehicles, industrial and solar power conversion, data and telecommunications infrastructure, and the new and coming optical I/O, and co-packaged optics semiconductor markets.Well, let me discuss our progress with silicon carbide and gallium nitride-powered semiconductor customers. As a reminder, silicon carbide is a compound semiconductor that has thermal conductivity that's 3x better than that of silicon, and the dielectric breakdown strength of SiC is around 10x better than silicon, making this much better for high-voltage, high-power applications.Silicon carbide has become the semiconductor of choice for use in electric vehicle power conversion and chargers, and in particular, it is a key differentiator in the motor traction inverter due to the longer range and faster charging than electric vehicles using silicon carbide C.Silicon carbide semiconductor devices have a very high relative early-life failure rate compared to pure silicon, but these failures can be weeded out with special electrical and thermal stresses referred to as burn-in, such as those supplied by Aehr's family of FOX wafer-level test and burn-in systems and our proprietary WaferPak full wafer contactors.Our WaferPaks make electrical contact to the tiny electrical pads of the semiconductors while still in wafer form and are unique and specific to each customer device and wafer layout. Customers are moving from package or module form of burn-in to save on the yield loss of the packages, in particular, for multi-die modules used in the new electric vehicles.Aehr has a unique solution for being able to test thousands of silicon carbide devices at a time on a single wafer and also up to 18 wafers at a time so that our customers can remove extrinsic failures to get the quality and reliability critical to the electric vehicle suppliers in an extremely cost-effective way.We can do this testing and burn-in, while ensuring that every single device is proven to be burned in before they're shipped to the end customer. This cost-effectiveness and assurance that 100% of the devices are burned in is critical to this market.Last month, we announced our first order for a FOX wafer-level test and burn-in system to be used for gallium nitride devices. This customer is the leading global supplier of semiconductor devices used in electric vehicles and power infrastructure and adds another major customer to the list of companies using Aehr's FOX products for wafer-level test and burn-in of wide-bandgap compound semiconductors. We were already able to ship this system within a few weeks to them to meet their needs.We're now working with 2 of the market leaders in gallium nitride, which positions us front and center in a market that we believe is another potential growth driver for our wafer-level solutions.Gallium nitride is similar to silicon carbide in that both of these compound semiconductors are considered wide-bandgap semiconductors that are more efficient in higher voltage power conversion applications than pure silicon semiconductors. We believe the gallium nitride market is another potential growth driver for our wafer-level solutions, particularly for automotive and photovoltaic applications where burn-in appears to be critical for meeting the initial quality and reliability needs of those markets.We continue to make great progress with our previously announced benchmarks and engagements with prospective new customers, including the significant automotive qualification of wafer-level burn-in we've been doing with one of the market leaders in silicon carbide.We believe we have a large opportunity with this potential new customer and feel confident they will move forward with our FOX-XP multi-wafer solution for their high-volume needs, but the timing is taking longer than anticipated. We remain confident that we'll receive initial purchase orders from them in fiscal '24. However, it's not clear whether they will have infrastructure ready to take shipments from us within our fiscal year that ends May 31st.We've made significant progress in expanding our customer base for silicon carbide, or SiC, and gallium nitride, or GaN, wafer-level burn-in for a wide variety of applications. We currently have a total of 7 customers purchasing our solutions for SiC and GaN devices and are also actively engaged with more than 2 dozen SiC and GaN companies to address their needs for wafer-level test and burn-in of these devices. Importantly, 10 of these additional companies have already engaged with Aehr for on-wafer benchmarks.We have never lost a full wafer-level burn-in evaluation since introducing our FOX-NP and XP systems configured with silicon carbide and gallium nitride test resources, and we believe we will have over 12 silicon carbide/gallium nitride customers buying our wafer-level test and burn-in solutions by the end of this calendar year 2024.These companies are projecting revenue growth and the need for burn-in in their devices at the wafer level to weed-out the early failures that would otherwise show up in their devices or modules, or worse, in their customers' applications. We firmly believe that Aehr provides the most competitive solution to burn-in devices that will be used in power modules and have shown examples where a cost of test and burn-in is significantly cheaper to do in wafer form than in the historical package part form.Package part burn-in is an option for discrete devices in individual packages, but the yield placing multiple devices in a single package or in modules exceeds the cost of test significantly.For example, at a loss of 1% per die during burn-in, a module containing 32 die experience a 32% yield loss of the entire module, and all the die inside are thrown away if they're burnt in at that module level. This is a real-life example that we have seen across every customer we've talked to.In anticipation of both our current and new customers' forecasted needs, Aehr has put in place the inventory, infrastructure, and processes to increase our manufacturing and installation capacity, as well as significantly lower our lead times to meet growth in our customer capacity needs. This allows us to ship a large number of systems and WaferPaks within the same quarter that we receive purchase orders, which is certainly the case in this current fiscal year.While we've seen delays in orders from our automotive customers, we're actually seeing a pickup in opportunities for silicon carbide wafer level burn-in for applications outside of the electric vehicle market, which includes the industrial, solar, and commuter electric trains, as the efficiency and value of silicon carbide is being recognized for these additional markets.Even though the largest market opportunity for silicon carbide is still electric vehicles and charging infrastructure, industrial and other power conversion market segments represent significant additional opportunities for silicon carbide for Aehr's products. William Blair forecasted the total silicon carbide marking is growing at a CAGR of greater than 4% annually to $8.5 billion in 2025, and over 25% of that will be in industrial and energy power conversion applications.As we noted on last quarter's call, we're also seeing a continued stream of new designs for our WaferPaks, as more and more electric vehicles are coming online with their own specific device designs for inverters and onboard chargers.Our proprietary WaferPak contactors are needed with our FOX wafer level test and burn-in systems to contact with the individual die on the wafer and are designed specifically for a given device. As our customers win new designs from their customers, Aehr will eventually secure orders for new WaferPaks to fulfill these new wins. With each new design, our customers will need enough new WaferPaks to meet the volume production capacity needed for those new devices.Last quarter, we mentioned that our new WaferPak and applications test program design volume has tripled over the past previous 9 months, and this quarter will be a new company record for new WaferPak designs for customers. Each design can turn into a high-volume production application, driving tens or even hundreds of WaferPaks needed for production, highlighting the recurring revenue part of our business.We believe that for the semiconductor test markets we serve, our customers desire, if not require, short lead times for test and burn-in systems, and particularly for the WaferPaks used with them.During this fiscal year, we've been able to increase our manufacturing capacity to enable us to ship up to 50% or more FOX test blades per month, representing 50 or more wafers of full wafer test and burn-in capacity each month. We have the supply chain infrastructure and process in place to increase this another 50% by the end of this fiscal year and heading into our fiscal 2025 that begins June 1st.We've increased our WaferPak capacity to not only support WaferPaks for new systems, but also for our installed base of systems so that customers can purchase and ship large quantities of WaferPaks within a few months.We believe the added inventory, increasing capacity, shorter lead times are creating an even larger competitive advantage for us, which in turn will result in continued market share expansion and growth in the markets we serve.So let me move on and talk a little bit about silicon photonics. We remain very enthusiastic about this market, which includes the current photonics transceiver market used in data and telecommunications and the upcoming application of silicon photonics integrated circuits for use in optical chip-to-chip communication, which we see as a major market opportunity.These next-generation silicon photonics-based integrated circuits can require up to 2x to 4x as much power for full wafer test and burn-in then stabilization. And our new high-power configuration or FOX production system, which can be used to test and burn-in these new optical I/O devices, expands the market opportunity of the FOX-XP system even further.We've been making good progress on our new volume production FOX-XP system for these very high-power silicon photonics device wafers and expect to ship this system by the end of our current fiscal third quarter to fulfill our first order from our current major silicon photonics customer that we received last May.The system is configured to enable cost-effective production tests of up to 3,500 watts of power per wafer and up to 9 full wafers in parallel and also includes our latest chamber configuration, which has a smaller overall footprint. This new system is also auto-aligner ready, enabling our customers to easily dock this to our new FOX WaferPak auto-aligner for hands-free operation of wafers from 6 inches to 12 inches using industry-standard wafer cassettes and FOUPs.This new FOX-XP configuration allows for the testing of as many as 8,000 high-power optical devices in parallel on each of 9 wafers before they're singulated and placed into a photonic application, such as fiber-optic transceiver modules or for placement and co-package optics for optical chip-to-chip communication devices, such as those that have been announced on product roadmaps by companies including nVidia, Intel, AMD, TSMC, and Global Foundries.These photonic ICs require an extra step in their manufacturing process referred to as stabilization or aging, where the devices experience a varying degradation and then stabilize of their optical output power as a function of the input power. This is critical to stabilize before integration into a transceiver or optical chip-to-chip communication package. This process step takes many hours or even more than 24 hours for the stabilization and is critical to do before the die is integrated into the system.Aehr provides a unique solution for doing the stabilization of all devices while still in relatively easy and repeatable wafer form. One key challenge is doing this in massive parallelism up to and including all the devices in the single wafer is the power and power density of testing the devices in this form. The stabilization requires very high power, and this not only requires a test system to deliver the high power to the wafer, but all the power to the wafer must be removed in the form of heat to keep it from literally destroying the devices.Aehr can not only provide precise, regulated, and calibrated voltage and current to the devices on the wafer, up to 3,500 watts per wafer and 9 wafers at a time, but we can also remove this power, while we're maintaining a uniform temperature across all the wafers.At this time, we believe we're the only company providing -- both providing and removing this much power to silicon photonics wafers and are also doing it up to 9 wafers at a time. This is a key differentiator in what we believe is an enabler for the capacity and scale needed to address the high power photonic integrated circuits used in very high-speed optical transceivers and also the up-and-coming optical chip-to-chip communication devices market.As I noted in our last call, Aehr currently has 6 customers using our systems for production tests of silicon photonics devices. We're watching this market very closely and are working with some of the leaders in silicon photonics to ensure that they have the products and solutions available to meet their needs for this potentially significant market application.Let me conclude. We expect continued strong demand for our wafer-level burn-in solutions, giving the continued growth forecast for the markets they address and the expanded market opportunities we're seeing. While we've reduced our growth estimates for fiscal '24 revenue, given the uncertainty on the timing of customer orders, we believe we remain well-positioned to capitalize on the incredible growth of this industry and are poised for continued solid growth for years to come.With that, let me turn it over to Chris, and then we'll open up the line for questions.
Thank you, Gayn. Good afternoon, everyone. We're pleased to announce another solid quarter for Aehr Test Systems with strong year-over-year growth in revenue and net income, both ahead of consensus estimates.Let me summarize our results for the fiscal second quarter. Second quarter revenue was $21.4 million, up 45% from $14.8 million in Q2 of last year. Strong demand in all revenue categories, including systems, contactors, and services, contributed to a significant year-over-year increase in revenue in the second quarter.WaferPak revenues were $9.2 million and accounted for 43% of our total revenue in the second quarter, which was consistent with 45% of our revenue in the prior year quarter. Customers typically buy WaferPaks from us, subsequent to purchasing our FOX systems. We are seeing continued momentum for new WaferPak designs with existing and new customers to meet their customer and market requirements.As Gayn noted, we have seen how the slowing of growth in the electric vehicle market has had a negative impact on the timing of several current and new customer orders and capacity increases. As a result, bookings in the second quarter were $2.2 million, and our backlog as of quarter end was $3 million. We expect orders for systems, WaferPaks, aligners, and services in this and next quarter in time to support our latest revenue forecast.GAAP gross margin for the second quarter came in at 51.1%, down from 53.4% in Q2 last year. The decrease in growth margin is primarily due to higher inventory reserve and increased period costs. Operating expenses in the second quarter were $5.5 million, up 24% from $4.4 million in Q2 last year.The year-over-year increase is primarily due to previously noted increased headcount-related expenses to support our worldwide sales and marketing efforts, along with our R&D programs.Our investments in sales and marketing staff continue to have a positive impact on expanding our customer engagements in the U.S., Asia, and Europe, and marketing-rich to support revenue growth. The increase in R&D in Q2 from the same period last year was primarily due to costs associated with development programs for augmenting features and performance of our automated wafer aligner and higher personnel expenses.The first order for our integrated automated aligner that was shipped in the fiscal first quarter of 2024 was accepted by our customer in the fiscal second quarter. We continue to bring in R&D talent and invest in R&D programs to enhance our existing market-leading products and to introduce new products to maintain our competitive advantages and expand our applications and addressable markets.Non-GAAP net income, which excludes the impact of stock-based compensation, was $6.7 million, or $0.23 per diluted share for the second quarter. This is up from non-GAAP net income of $4.5 million, or $0.16 per diluted share, in the second quarter of fiscal 2023.Turning to the balance sheet, we continue to maintain a strong cash position on our balance sheet. Our cash and cash equivalents were $50.5 million at the end of Q2, flat from our cash and cash equivalents balance of $51 million at the end of Q1. With a strong balance sheet, we can continue to invest in scaling our business.Over the past 6 months, we have invested financial and human resources in improving our own infrastructure to support the continuing growth of our business. We recently went live with a new human resources information system in Q4 and are implementing a new enterprise resource planning system that will provide more sophisticated functionalities and capabilities to support decision-making and compliance.We expanded our policies and procedures in various functions to provide more internal control and structure. We have made improvements in our supply chain and engaged with contract manufacturers that offer more value-added quality components and services to support our growth.We used $0.5 million in operating cash flows during the quarter to procure inventory components to support our revenue target in fiscal 2024. Even though our book-to-bill ratio is less than 1, we believe we have the necessary inventory components to build products quickly and ship them to our customers when we receive purchase orders from them.We have zero debt and continue investing our excess cash in money market funds. Interest income earned during this favorable interest rate environment was $631,000 in the second quarter compared to $263,000 in the second quarter last year.In Q3 of last year, we announced an ATM offering of up to $25 million in shares of the company's common stock on the open market. We received gross proceeds of $7.3 million on the sale of 209,000 shares in fiscal 2023. We did not sell any shares during our last 3 fiscal quarters.As of the end of the second fiscal of 2024, the remaining amount available under the ATM offering was $17.7 million. It remains our plan to only sell shares against this ATM offering at times and prices that are most advantageous to our shareholders and to the company.Now, turning to our outlook for the current fiscal 2024 year that ends on May 31, 2024. As Gayn noted, we expect continuous strong demand for our wafer-level burning solutions for the markets we currently address, as well as increased demand from the new market opportunities we are seeing. However, given the latest customer forecast and the uncertainty on the timing of their orders, we believe it makes sense to take a more conservative approach to our fiscal year forecast and reduce our growth estimates for fiscal 2024 revenue.For the fiscal year ending May 31, 2024, Aehr is revising its expected full-year total revenue to be between $75 million and $85 million, representing growth of 15% to 30% year-over-year, and GAAP net income of between 20% and 25% of revenue. Even with this more conservative guidance, we expect solid year-over-year revenue growth and believe we are poised for continued strong growth for years to come.Lastly, looking at the investor relations calendar, Aehr Test will be meeting with investors next week at the Needham Growth Conference taking place in New York. We will be meeting with investors throughout the day on Wednesday, January 17, and until noon on Thursday, January 18, and hope to see some of you at this conference.This concludes our prepared remarks. We are now ready to take your questions. Operator, please go ahead.
[Operator Instructions] First question today is coming from Christian Schwab from Craig-Hallum.
Gayn, can you give us some indication of how you would anticipate the revenue orders to come and support the second half of the year? Are you assuming the vast majority of the revenue you are guiding for the fiscal year will come in the May quarter?
Yes. No, that's a fair question. I mean, we're -- given where the orders are right now, with already a chunk into the third quarter, we think that second half of the half, it sounds right. Q4 will certainly be bigger than Q3. I don't know, maybe, but not majorly. Maybe a 60-40 spread or something like that. So we are still expecting orders and have things lined up to ship for this quarter.
Okay. Okay. And then you guys talked about, gave your prepared comments, you talked about, we are seeing a slowdown, given all the reasons that you mentioned. But then you went on to say, that does not change your growth expectations for years ahead. Can you let us know, what are your growth expectations? What do you think, the top line growth rate of the company on a multiyear basis will be?
Yes. Yes, that we probably set ourselves up for that, Christian, because as you know, we haven't given a multiyear growth strategy on here. Let me answer it this way instead. And I know that we'll be giving next year's guidance in July. I'm not yet sure we'll commit to a multiyear or not. But when we talk to the customers, one of the hardest things about preparing for this call was even -- not even 30 days ago, we were still hearing across the board from our customers, bookings and shipment slot requests that were consistent with us exceeding the $100 million -- and it's only been in the last couple -- few weeks that we've seen things including all of the way last weekend, where they've sort of finalized what their plans are and push some things out.These customers have not changed their long-term plans. Their forecast for their revenue growth, their market share, their silicon carbide, their test times, those kind of things. We think are still consistent with what we have been sharing in the past, which includes, by the way, test time reductions over time, consistent with the models that we generated a couple a few years ago, where if you look at a 4 million wafer starts or thereabouts to support just the EV market, it would take somewhere on the order of 2,000 wafers of capacity or 2,000 of our blades for the overall market.And so we haven't changed that. And in fact, I'll add one more thing here. Those numbers were based on this 30% penetration of 100 million vehicles or 30 million EVs in 2030. I keep using that 30, 30, 30 number. Last year, for the bulk of the year, there are many people saying that EVs were going to be faster than that. There will be more than 30% penetration. We actually never repeated that because our feeling was that just seems, too aggressive.So in some ways, people's growth estimates have kind of modulated back to be consistent, I think, with those 30, 30, 30 numbers. So in that sense, it hasn't changed our opinion. But if you -- you start looking at a discrete customer who was going to put in enough, start installing tools this spring for having them ready in the fall, and, they shift things out 2 or 3 or 4 months, all of a sudden, it impacts us. And that's the downside of the front end of this. And what I hope people hear today, and throughout the whole Q&A is, we're trying to be as absolutely candid as possible. And, what the customers were telling us in previous quarters, we were communicating, and now they have changed their timing of it. And we're just trying to communicate that to it. We still have the capacity and the capability to exceed $100 million this year.If customers came in and said, just kidding, I need them after all, we still have the ability to do that. But right now, that's just doesn't seem like the most likely case. We don't think that is impacting our plans going forward, and that we think we still have these, pretty solid growth expectations for next year and beyond.
Just then maybe another way thinking about, as we exit this year and go into fiscal year '25, would you assume that your lead significant, much greater than 10% customer, can grow or sustain itself at a material run rate, $50 million, $60 million, $80 million? How should we be thinking about, I understand you don't want to make a proclamation about what, their aggregate demand has, but they've made comments about it. So, given their public comments, I guess, let's start with that. How would you anticipate that customer materiality in fiscal year '25?
I mean, we -- I believe that they will still be material. I don't know that they will be the dominant customer at our times, but they may not be. My guess is they will not even be the largest, as some of the other customers are kicking in with their ramps. One thing we've tried to look at is, how fast is the market growing itself? I mean, if silicon carbide is growing at, say, 40% a year top-line revenue, can we grow faster than that? I think there's examples where we can, but I think, it would be more realistic to think that we grow alongside the market itself. But, as we displace potential package part burn-in, et cetera, there's opportunities.The wild card of this would be the mix. So as a customer, if they have purchased WaferPaks from us, and they're shipping, $100 million worth of revenue a year to a customer, the next year if the devices stay the same, they wouldn't buy any more WaferPaks, and certainly not systems, to meet that $100 million. If that customer or our customer's customer grows from $100 to $200, they would buy more systems and more WaferPaks. But if their customer mix or the product mix changes, they might displace all of those WaferPaks, so we would get revenue even though their revenue isn't growing. That's a very important part of, obviously, our business for our shareholders, but also to our customers that we can continue to generate revenue and have the dollars to spend on R&D and applications and support and new enhancements for their needs, even if they're not necessarily buying new systems, but we do think that they will still be a significant customer for us next year. We believe that they -- and are consistent with what they have been telling people their growth plans are, but we think that there will be other customers most likely that will be bigger than them next year.
Great. And then my last question, I apologize for so many, is the Chinese market still is a fast adoption, adopter of silicon carbide, has numerous manufacturers, many manufacturers of silicon carbide. Is that a market that you plan on eventually targeting or are you currently targeting?
Let me give you -- that's a good one. You're taking all the good questions here, but let me talk about the Chinese market because I think there is a change there from last quarter, and I'll be giving more updates probably at the next one. So the Chinese market, certainly the EV market itself is growing very fast. A lot of the things you hear in the U.S. with respect to, why people should or shouldn't adopt EVs is just not the case outside of the U.S. and particularly in Asia and in China. Chinese EVs are have exploding growth with, big suppliers like BYD and Nio and others. We're actually shipping where we know we're testing products that are going into the Chinese market today. So they are being tested in China, right. But they're actually being tested on our systems and shipped to it. A lot of the silicon carbide, if not the majority, is still being supplied outside of China into China. But we see that changing over time as there's a lot of players getting into the Chinese market for silicon carbide, a lot of them in the -- in the wafering itself, but also in devices.In the last quarter, we've had some pretty active conversations with some of the big Chinese suppliers, who candidly are asking us to participate and to engage with them more directly. And we've been having some conversations related to how can we protect our IP there, what would that look like, et cetera. And we are working on some strategies that -- I'm not trying to keep them from our shareholders. I'm just trying to keep them from our competitors. So we're keeping those close to our chest. But expect some movement there over the next quarter.And I will give you some movement in what we're doing. Next quarter, I'll try and give you guys some more update. But there are some key activities going on in China that I think Aehr is going to be participating in. Okay?
The next question is coming from Jed Dorsheimer from William Blair.
Sorry for the background noise. I'm in Las Vegas meeting with your customers, actually. So just, Gayn, trying to reconcile, it sounds like there was a material change in the last 30 days in terms of demand and visibility to your business. Is that correct? And I just ask that because your largest customer did flag some things last quarter. But I want to separate what happened in the past versus what's occurred in the last 30 days?
All right. Well, one thing I'm going to start giving people heads up on is I'm trying to be more thoughtful about giving insight into our customers, to be fair. But I'm going to specifically answer what I think you're implying. Right after our largest customer talked about their change in their forecast, we not only did not hear a negative impact to us, candidly, it flipped around and for a period of time it was actually an up-tick, okay, which was a little hard to imagine and explain, but it had to do with the WaferPak and the shift to new customers and some other things.Literally in the last 7 days, they have reconciled their plans, et cetera. And we've tried to thoughtfully reflect that in the latest one. But again, I actually said in my prepared remarks, their revenue to us is pretty close to what we were expecting when this all came out. So if you want to say the bulk of the $15 million to $25 million decrease was not from them, that was actually from other customer forecasts that have changed over the last, like 3 to 4 weeks, candidly.Our lead customers forecast settled in only in the last week or so. Now, having said that, folks -- it may not be the right answer. There's still a range. We took a very conservative stance in hopes there's no way we'll miss it on the low end. But I can see scenarios where we could be higher than the range I gave you. But going out and saying we have a range of $75 million to $100 million just seemed weird, silly. And so we're taking this stance. I think we really think that, this is appropriately communicating what the customers are telling us. And we could defend that. And we're doing our best to just be open with people.
That's helpful. I guess Gayn to that point, though, if I look at what you've done this year versus the guide of 75 to 85 and subtract out the delta there, that would imply it was equal between each of the next 2 quarters, somewhere between $16 million and $19 million each quarter. And I know to Christian's earlier question, you said it would be 60-40. But I guess it does beg the question with the current bookings, what gives you the confidence towards the low end there? Because you seem pretty confident that, it's been conservative and there would only be upside. But I guess what's giving you that? Is that the verbal commitment that's happened in the last few weeks with the customers?
Yes, I mean, I would warn what a verbal commitment really is. We are in constant communication with all of these customers. And our lead customer is daily, candidly. I'd say that the numbers and the forecast they've given us have been constant for the last 30 to 60 days, but on the low end. And so that's why we have more clarity. I think they have direct visibility of orders that they have from their customers and what that drives in terms of WaferPaks and capacity, et cetera. But I will -- my personal belief is, I don't think they have perfect visibility. And I think, there's a little bit of reaction to the seeming slowdown. But now with interest rates recovering, and perhaps people getting to their inventory, maybe they'll be pleasantly surprised on their side.But yes, I mean, we're down to knowing when we have these forecasts, we know what WaferPak mix it is, et cetera. So we have pretty good visibility. I'd say very good visibility.
So 2 more questions for me. The first is, with the inventory that you've built, which is good if you get to move to a turns business and a book and chip. But I'm just wondering whether or not that presents a challenge of holding pricing, whether or not if pricing was to erode it all. How should we be thinking about a margin impact? And then also with WaferPak versus system?
Okay. There's a couple of things. So first of all, on the inventory, the inventory that we built, we believe allows us to address the needs across all of the markets we've talked about, plus the 2D, 3D sensing, including memory that we didn't spend much time spending. We built this platform of a mix that basically we can ship to multiple different customers. That gives us the confidence that we bought this material, we're not going to be writing it down or anything along those lines. So that one is really important. We've had a lot of conversation about that.The turns business has the advantage of you can get an order today and ship a lot in the next month. It has the disadvantage of customers can wait and kind of try and hold you up. We're not and have not been in conversations with people and don't really entertain conversations of people trying to hold us over a barrel.If you decrease your price, then I'll place your order or I'll take a shipment. Candidly, we've tried not to do that. I think that's the wrong answer. Would pricing come down over time? We have not been experiencing that. What we have been doing, and we've expressed this to customers, our costs, like everybody else's costs, increased during COVID. But we did not pass those on to our customers, even in extreme cases when shipping costs were out of control. So we've been able to hold our pricing, which as a vendor, I appreciate a lot. And so, candidly, our customers raised their prices on us because we buy their components.But we've been able to hold our pricing, even in a time when we're extra competitive, and we've not been gouging our customers. And I think that's really important. By the way, I wasn't sure, if I was going to do this. I'm going to throw this out publicly out here. We are aware of a scenario where an investor approached one of our customers and had some conversation related to, we believe it was a hedge fund that had our short our stock. We have like a 20% short position. Approached one of our customers and was complaining to them about how much money we're making. They clearly had a vested interest to try and get the customer to try and negotiate our prices down. And I think that's garbage, but it's not against the law.But I'm publicly pointing that out, out there. We did not, as a result, raise or lower our prices or something else. But people have all kinds of reasons to want to communicate with our customers. And by the way, Jed, you just say you're talking to customers. I'm not accusing you of that, please. That is not the case. But somebody did, and it really upset our customer. And one of the challenges we need to do in being so forthright with all the information is that people use that information against us in sort of the weirdest of ways. But at this point, we are able to maintain our pricing to our customers, maintain good margins. And that includes on our systems and on our consumables and the WaferPaks, which is critically important for us to maintain healthy growth so we can meet our customers' needs as well. Okay?
[Operator Instructions] The next question is coming from Tom Diffely from D.A. Davidson.
Quite a few have been asked already, so I'll stick to a couple of just industry questions for you Gayn, if you don't mind.
No problem.
I'm curious where we are as an industry when we talk about power conversion devices in the move from silicon to silicon carbide, and then inside that, where we are from discrete silicon carbide to kind of multi-die systems.
Okay. So it's interesting. The ISS Summit is going on right now, and I think people have been feeding me slides of what's going on. And that's just an industry forum where large players like Infineon and ST, for example, were presenting. And they were showing their roadmaps and talking about the importance of silicon carbide and gallium nitride to the power semiconductor industry and how that fit with silicon. Why that's important is they, plus on semiconductor as an example, are not pure plays. They have both silicon IGBT, large businesses, multibillion-dollar businesses, as well as silicon carbide businesses and gallium nitride businesses in the cases of ST and Infineon in particular.So they have, I would call it, a good, balanced opinion about what's going on because they're doing both. They talk about how important it is for kind of a greener planet because of the efficiencies associated with both silicon carbide and gallium nitride and how those markets are going to grow significantly and not only displace some of the IGBT, but create new markets that didn't even exist before.So my feeling is that silicon carbide -- we've had a chance to sit in front of customers in Asia and Japan, Europe, U.S. There continues to be a ton of excitement around silicon carbide and not just in the EVs. And, guys, we're not pivoting. EVs are critically important and they're a huge opportunity for Aehr Test. But there's a lot of companies. In fact, the last 2 customers that placed orders with us, they were not aimed at the EVs. I said that, already publicly.They were actually at other applications. And so those companies are making their whole strategy related to a little bit of -- silicon carbide was so much around its initial focus, which was, of course, with Tesla Model 3 and the inverter, which kind of created the whole segment. But it's like once people have made the investments to put the silicon carbide out there. There are all these other applications that would benefit from it.And to some extent, with more suppliers -- and I don't want to say pricing reducing as much as it is just availability of it. There's a lot more people getting into it. And so silicon carbide is the real deal. It's going to grow. I recently heard from one of the biggest suppliers. They think that silicon carbide will still be in short supply to certain applications all the way through the end of the decade, even with all the investment that's going on.Now, silicon carbide, kind of the over-under we've been using is this 1,000-watt thing. At 1,000 watts and above power transfer, silicon carbide is going to dominate. But for applications 1,000 watts and below, which could be individual servers, microinverters, and solar, certainly all the little chargers for Apple, your devices, et cetera, they're all going to be gallon nitride. That's what we think.And they'll completely shift away. The idea that you're going to have a little transformer that plugs into the wall and heats up and it's the size of your fist to power your computer, that's all going to be gone. There won't be any of those things in a few years. They'll all be these gallon nitride -- they call it solid-state transformers or solid-state converters done through high-speed switching of gallon nitride and to some extent also silicon carbide. I think in the low end, less than 1,000 watts, GaN is going to win. And those things are important.Now, your next question was discrete versus module. This is where I always have a show-and-tell, and we don't do these things with video feeds. But discrete normally refers to a single device sitting in a package form with the 2 or 3 leads from it. Okay? This discrete device, if it fails, it only costs you the packaging. And so the world had been actually testing those devices in the package form before we got here. And when people said, they're going to put up to, say, 32 of these devices, 10 of these devices, 24, 48 we've seen all kinds of different ones. They put them in multiple die in the same package.We refer to that as a module, although technically it's still a package, but a module meaning multiple die inside of it. The yield loss associated with that becomes a real problem. And so if you had 30% yield loss because you had 30 die in there, I mean, that's pure cost. Your manufacturing cost would be increased by 30%. Your output would be decreased by 30%. So that was really what started this wafer level, why it became such a big deal in silicon carbide, was because companies were moving to the module level.We still see that transition. The likes of very public announcements by BorgWarner that's all the U.S.-based guys and more. FZ out of the European ones, the Danfoss folks out of Europe, Volkswagen has publicly talked about this. There's multiple companies, the folks starting to come out of what's going on in Japan and also out of Korea.We think that the bulk -- and what we've been told by our customers. The bulk of electric vehicles and the big power conversion will all be modules. And so when they go to modules, it's so much more cost-effective or even a must to do the wafer level burning of those before you put them into the modules. And so that has been the leading indicator that was driving our business.And so now the question is, did something happen? Have things slowed down to those cars, et cetera? I mean, clearly, we've seen some push-outs of roadmaps and stuff from the likes of GM and Ford. I don't think anybody's confused. But I'll tell you what. You don't see that. Is that offset by the pull-in of Toyota, who last February was still maintaining, they didn't believe in electric vehicles until the CEO was displaced? We're seeing, if you get outside of the U.S., you can just sort of -- you can see the roadmaps for people. I mean, there are companies like Hyundai just announced. They just shut down 2 engine plants. It's like the old Viking days of burning the boats. They're not going backwards.They're getting rid of that. In the U.S., you can't do that because of unions and things like that. So it's a big contrast. And we think that modules are coming. They're going to be in from the largest to even some of the smallest automobiles that are out there in EVs.
So even though it's on everyone's roadmap, would you say today it was very, very early in that transition?
I believe still. I do. I mean, not everybody's doing it. And I don't want to get into anything other than what is publicly described out there. But even some of the shifts with respect to what's going on in Tesla's business has had an implication because I think people know. And again, I'm not saying anything that's not public. Tesla, which started this segment, they actually use a form of a discrete device in their current converters. It has 2 die in each device. You would call it a module. And depending on the supplier, they can either do it with package form or wafer level. And some of those shifts could have an impact on us in the near-term. But although, I'm not providing any insight into what Tesla's plans are long term.But the prevailing thought process is that by the end of the decade and certainly before that, you'll see also some carbide engines in modules or most of them.
The next question is coming from Matt Smith from Halter Ferguson.
Yes. Gayn, I wanted to kind of piggyback on that last question. I mean, hearing everything you've talked about in the longer term kind of prospects around GaN or photonics or even new markets within auto. Am I right to presume that you're at your kind of level of expectation for [Technical Difficulty]
Matt, you just broke up on your last sentence. Our level of expectation what?
Sorry. Apologies. Can you hear me now? Is that any better?
Yes.
Yes. All right. Just your level of expectation around some of these either new markets or new segments seems to be increasing relative to maybe what you would have thought a couple of years ago or maybe even a couple of quarters ago. So despite the kind of short-term noise or lack of demand we might be seeing on auto, is your expectation on the other segments kind of increasing to the point where you think you might be close to capacity in a couple of years?
Okay. So, yes. Let me kind of the historical perspective of the timing of it. I'll pick on -- what do I do? Memory. Okay. We didn't talk much at all about memory. What we've said is if you invest in Aehr, you're investing in memory. Memory has always been on our plans, and we have different level of engagements, and we're still talking with memory suppliers about potentially wafer-level burden. It is not deployed in mass yet. It makes sense at Flash. It ultimately makes sense in DRAM. That's the longest term out there. We're not planning to get revenue in the next year, but I've even shared we have specific long-term bonus and KBOS for every manager on my staff and myself to get into memory. So that is a real thing. Back up a little bit.It's Gallium Nitride. We just talked about Gallium Nitride just like within the last 9 months, and what we said at the beginning of the year is we're going to work to engage with the leaders, which now I'm very comfortable we are, to understand the requirements and what their needs are so we can be there to address their needs. And to learn and understand if there's a large production opportunity. What I'll share with you is that, we learned a lot already together with those customers. There's some things about it, and I'm not going to get into it on this thing, but there's some real tricks that we've been able to help our customers to solve that are unique to GaN versus silicon carbide.And honestly, I'm super happy about it. I'm a bit of a technical nerd, but the things that we're able to do with the customers are really impressive. And that's great, and puts us in a very good, comfortable position to be able to be there. There is data that is now supporting the need for production burn-in. We're still getting our arms around how big that is, and so we haven't put out any actual numbers, but I do believe much more confidently now than 2 quarters ago that there will be production business for us, versus before it was more of an investigation. Okay?And then the one prior to that would be, another one was, silicon photonics. The first time I talked about silicon photonics IO was December of '22, so it's only been a little bit of a year ago. And at that time, I mentioned that early indications from the likes of an Intel had actually started to talk about it in demos. They're on their website. They were, Pat Gelsinger was giving up and talking about this. And it's like, boy, something sure seems like there's brewing around that. And people said, what do you think? And my question was, listen, that would be fantastic. And it makes sense because it has all the same needs. It needs burn-in. It's a compound semiconductor, both for reliability and stabilization. Its application is a multi-chip module, meaning you'd want to do it at die level, because if you put it in with a graphics processor or a central processor or something else, you don't want that device being thrown away if this one fails. Okay?The early indicators were we had gotten some NP engineering, and then we got a production order last May. And people asked, what did you think? I said, I was surprised. That seems sooner than expected. That's the one we're working on to shift this quarter by next month. Okay? So we're now seeing more visibility of that. And candidly, and I don't want to get too carried away on this AI thing, but the people who are out there, you know, nVidia and AMD and Intel have been talking about one of the big problems with these AI processors is their chip-to-chip bandwidth. Or, they can talk internally to the die that are inside, but even that's at a bandwidth limitation.So each of those have talked about, how do I actually integrate an optical interface to be able to overcome the bandwidth limitations of an electrical interface? And TSMC and Global Foundries have been making big investments to be able to help them with that, or the IBMs of the world, like in Intel, would be doing it themselves and AMD somewhere in between. So what we think is that looks like a really interesting opportunity and it's right up our path because what we do there is candidly even more unique than even the silicon carbide because of the power.The interesting thing is if you walk up and look at it, it looks like the same system that we're shipping to silicon carbide. But instead of high voltage, we're talking about high power. In this case, lower voltage and a lot of current. And so with the mix and match of the platform allows us to do that. So this is actually just a reconfiguration of the same system that we were shipping to the likes of silicon photonics customers and 2D, 3D sensors, like on the facial recognition on mobile phones. It's the same one, but even higher power than that.So I'm -- I'm still not clear. I would tell you people's roadmaps are really close to their chest. This is not something you're going to publicly read about how big the market's going to be. One of these days you're just going to see one of those big suppliers show up with a product and that's where the market's going to come from. So some of the stuff we're doing, the hardest thing is you can't go out and read about how big the market's going to be because it didn't even exist beforehand. So anyhow, those are some of the other markets that we're doing. I hope that gave you probably more color than you're even looking for.
Yes, I think what I was trying to get at is, it seems to me that the growth rate of these, let's call it non-core business segments for Aehr today, it's probably going to be higher than the growth rate within kind of core automotive silicon carbide market. Is that kind of how you would think about just the sheer quantity and the sheer magnitude of those opportunities?
Okay, 2 things. Okay. So if you're going to take growth rate, be careful because a small number growth rate can seem large and it's a small number. So are those bigger? The optical I/O market, we've said, we think can be as big or even potentially bigger than even silicon carbide simply because of the potential units and the test time. The dollars, it turns out it's actually much more expensive for us to build, even though it's extremely cost effective. So, it has the ability to be bigger. Memory absolutely is the biggest of all of them. Okay. And GaN is a TBD, I think, but looks promising. So if I try and give you relative sizes, okay.
The next question is coming from Larry Chlebina from Chlebina Capital.
Gayn, I have several questions that we get through them fairly quickly. We're getting late. Do you expect follow-on orders and shipments this fiscal year to the fully automated silicon carbide customer that you just booked the revenue last quarter? Do you expect shipments and revenues, additional follow-on revenues this fiscal year from that customer?
Yes. Yes, we – I'll let you down to the whole list here. I think we're expecting some level of revenue from most customers, including them.
Yep. That was a significant order. And since they ordered to them, I would expect they have a significant ramp that they're going to need some more capacity.
All of these -- all of the customers need significant more capacity to meet their revenue forecasts.
Okay.
That's correct.
Could it be that, that maybe the slower uptake of some of these customers, particularly the one you've been working on forever, is simply the fact that they're building 200-millimeter fabs and they're waiting for the 200-millimeter wafers before they commit to your full system so that they don't have to buy 2 sets of WaferPaks. Why start at 150 if you wait a little bit, you're going to be on 200. Maybe they have a bunch of single wafer probers that they can get buy on. It's not efficient, but going to be something along those lines.
I don't think that it could be, Larry. I mean, I don't think so. I look at each individual customer. Most of them are all planning to go from 150 to 200. Now, it's not it's not. So if you -- if let's say the 200 is a new line completely. Very often people may want to change their strategy and, go from discrete to die level on a new line, let's say. In that case, maybe you're right. They would time it with the 200-millimeter ramps. But that isn't that hasn't been how it has felt to us. People have -- I think, the 200-millimeter is coming. I mean, we're testing 200-millimeter wafers today from multiple customers, right. We see it. I think it's kind of consistent with everything that everybody's hearing. We don't have any particular great insight. I just don't. It's not -- I think it'll be it's slower than people originally thought. I don't think it's going to be 100% of the market. It's going to -- I mean, through the end of the decade, there's still going to be a big chunk of 150-millimeter wafers being built.One of the big discussions that's going on is will a 200-millimeter wafer yield higher than 150 at a lower cost per yield to die. And right now, I think everything I've read is not yet. And so -- but that's also very true with most of these transitions. You have to sort of chicken and egg. You have to lead with it. And then eventually your costs come under control.But, one thing with us is that the system is fully compatible between, 150-millimeter and 200-millimeter. You can build our auto aligner and it can work with both. We have current customers that, in the same day, are doing both, okay. And so -- and the WaferPaks, there are some things we can do with WaferPaks to actually leverage and help with that, too. But yes, I don't think that's the majority of it, but it might be on some customers.
Okay. On the optical I/O customer, it's interesting that they started with NPs. If I recall, 4 of them, they scattered around the world. Now, they're pushing you to pull-in and complete as soon as possible the production XP for that application. It would seem that in a fairly short time, maybe sooner than later, they might be needing quantities of production tools. As fast as that market is growing on the AI front, possibly it would give them a terrific leg up on their competitors. You think that could be something that might be at work here?
Maybe. Yes. I mean, we're preparing the tool that will allow us to duplicate and build multiple of the same flavors. One of the nice things that we did with this one is the system is actually in the new chamber configuration, so it bolts right onto the front or the back, if you will, of the aligner. So they could do it either with offline or integrated. It was not purchased with the integrated aligner, but we could easily upgrade it in the field if they wanted to do that. And we think -- I think that makes sense for that market. I think the aligner is the right answer. And as high volume, that would totally make sense.
Exactly. So along the high volume, last question. You mentioned many times that every DRAM is burned in. I'm assuming some kind of exotic package part burned in or whatever. But the large DRAM producer in the U.S. is planning on building actually several fabs in the U.S. And they're also introducing high bandwidth memory this quarter, I believe, with 12 stacks of DRAM on top of it. It just seems like a lay-up -- I know it's more complicated than that. But an application that would lend itself towards wafer-level burn-in versus doing testing on that stack and finding you've got a bad die in there somewhere. Wouldn't it make sense to try to get an evaluation tool on a fully automated XP over that memory customer before they set their plans on clean room space and so on and so forth, particularly before they commit to building those fabs?
I mean, I don't want to get too much into it, but DRAM, there's a couple of other things that need to happen with DRAM to be able to cost-effectively do a wafer-level burn-in, and we've had some conversations related to those DFT modes and what would be needed. Fundamentally, I mean, the HBM device can have 1,000 pins on it.Let's say you have 1,000 die on a wafer. That'd be a 1 million pin WaferPak. That -- we couldn't build one of those, okay? And if you could, it wouldn't be very cost-effective. So the net here is that's not the right answer. The answer has to do more with the DFT modes or something like the flash memory that I'm familiar with. And so there's some other things that need to happen, and we're going to help enable that. Flash memory is probably the leading edge of this instead. It's easier to get there. But I know that's pretty specific, Larry, but, I mean, DRAM would be, I find, probably the most impactful to the financials of those companies. And so they would have the vested interest to make those changes to their devices. And I'll leave it at that, okay?
All right. That's all I had.
This does conclude today's call. I will now turn the call back to the Aehr Test management team for closing remarks.
All right. Thank you. I actually wrote myself a couple of comments here I just wanted to do, just make sure to summarize, because, I mean, candidly, this is the first time we've come in and lowered. And so I'm -- we've tried to do our best to ensure that all of our shareholders, our customers, our employees understand that where we're at, we're not in, DEFCON 5 position here. We lowered our growth expectations, but believe that they're going to -- recover as we go forward.Aehr Test has spent a lot of time selecting and focusing on some really incredible markets. Some of those selected us, if you will. And we believe we're going to give us the opportunity to have more than our fair share of growth in the semiconductor capital equipment market. We're actually growing faster than semis in semiconductor capital equipment this year, okay? So that is a little interesting. People don't put it in perspective. We're focused on production wafer-level test and burn-in of silicon carbide, gallium nitride.We've talked about the growth in electrification, worldwide infrastructure, electric vehicle traction inverters, infrastructure, data center, solar, numerous industrial applications. And, we're candidly focused on engaging with multiple companies in the silicon photonics, okay? And we talked about the large companies that have roadmaps that are heading in a direction, if you will, where we have gotten to a place where they're coming towards us, right? We also talked about memories, and, I think as memory goes towards things like heterogeneous integration for graphics, AI processors, et cetera, long-term, that's going to make sense for this as well. There's these large macro trends that are going on.Semiconductors are going to double in the next 7, 8 years. More semiconductors are less reliable, compound semiconductors, smaller line widths, et cetera. And more and more semiconductors are going into applications that really matter, like automotive applications and sensors and things like this. And the heterogeneous integration, which is the result of the end of Moore's Law, people are having to put more chips together in the same package to be able to continue to meet the technical roadmaps. And when they do that, burning them in, in the package or module form doesn't make sense. These are all things that are aiming towards us for our solution. And candidly, we think we have a unique integrated -- a unique technology and solution for providing a one-stop shop for the systems, contactors, applications, test programs, and have the ability and the capacity and the lead times to meet the customer needs.So we're going to focus on market share, and we're going to focus on maintaining and growing profitably, right? If we can maintain a high market share in these new, exciting growth markets, we think we can achieve strong growth in a healthy, profitable manner, and that's going to reward our shareholders, employees, and our customers.And so with that, I really thank everyone for attending, and we look forward to providing you all with an update in our next quarterly conference call. Take care.
Thank you for your participation. You may disconnect your lines at this time, and have a wonderful day.