In the second quarter of fiscal 2025, Aehr Test Systems (NASDAQ: AEHR) reported revenues of $13.5 million, a 37% decline compared to $21.4 million in the same period last year. The decline is attributed to challenges in the silicon carbide market and a push towards diversification in AI and gallium nitride testing. Despite the decrease in revenue, significant operational advancements and customer engagement led to a notable increase in demand for their high-margin WaferPaks, accounting for 64% of total revenue this quarter.
Management is optimistic about future growth driven by the rapidly expanding AI semiconductor sector and successful market penetration efforts for new product lines, particularly AI processors, which they expect could comprise 40% of total revenue this fiscal year. The company remains cautious about the ongoing geopolitical and trade risks in the market, particularly in its dealings with China, where competitive pressures are escalating.