Aehr Test Systems (NASDAQ:AEHR) stock surges 22.98% (As on July 17, 11:27:47 AM UTC-4, Source: Google Finance) after the company announced today a definitive agreement to purchase Incal Technology, Inc. for $21 million. The acquisition will integrate Incal’s high-power test solutions into Aehr’s product offerings, targeting the artificial intelligence (AI) semiconductor sector. The terms of the deal involve Aehr acquiring all outstanding capital stock of Incal Technology, Inc. for $14 million in cash and 552,355 shares of Aehr common stock, priced at the average closing price for the ten trading days preceding the agreement. Incal reported trailing 12-month revenue of approximately $12 million for the period ending June 30, 2024. The transaction is expected to be immediately accretive to Aehr’s earnings and is set to close within the next 60 days, pending customary closing conditions.

Meanwhile, the company saw customer pushouts of silicon carbide devices due to slower electric vehicle (EV) demand in the second half of the fiscal year. Wafer level test and burn-in of silicon carbide power semiconductors used in EVs was a key driver of our business in the last year, and we anticipate silicon carbide will continue to be a key contributor to revenue in the current fiscal year and beyond. The company has announced today that it has received $12.7 million in orders from one of our silicon carbide test and burn-in customers for FOX WaferPak™ full wafer Contactors to support production of silicon carbide power devices for electric vehicles to be delivered over the next three months.

AEHR in the fourth quarter of FY 24 has reported the adjusted earnings per share of 84 cents, beating the analysts’ estimates for the adjusted earnings per share of 10 cents. The company had reported the adjusted revenue growth of 7.51 percent to $16.60 million in the fourth quarter of FY 24, beating the analysts’ estimates for revenue of $15.44 million. Bookings were $4.0 million for the quarter. Backlog as of May 31, 2024, was $7.3 million. Effective backlog, which includes all orders received since the end of the fourth quarter, is $20.8 million. Total cash and cash equivalents as of May 31, 2024 were $49.2 million, up from $47.6 million at February 29, 2024. Non-GAAP net income was $24.7 million compared to non-GAAP net income of $6.8 million in the fourth quarter of fiscal 2023.

For the fiscal year ending May 30, 2025, Aehr expects total revenue of at least $70 million and net profit before taxes of at least 10% of revenue.