Aehr Test Systems (NASDAQ:AEHR) Q3 2023 Earnings Call Transcript

They all worked with Tier 1s and then the Tier 1s bought from the semiconductor guys. But with all the craziness that went on supply chain, automotive guys who realize they need to go directly to and talk to the semiconductor guys. Well, we are taking a step further, they are talking to us. So there’s another way of creating clarity around what we offer, the traceability, the confidence in our solution, et cetera, and so I think we have several oars in the water in China. Having said that, we are very confident in next year and how things are going and candidly, without trying to be in a significant portion of it, I would say that would be upside to our plans.

Christian Schwab: Great. So I just want to be clear, Gayn. When you talked about China silicon carbide, you were talking about the six. I think I wrote six customers, that is Chinese domestic producers more than likely for Chinese domestic demand, is that…

Gayn Erickson: It’s my — by the way, I am not sure I have ever said six. When I talk about six a silicon photonics type people that we are currently in. But if there are six big players in China that are saying they are going to be in silicon carbide, I believe you, okay? It is my belief that those companies are most likely targeting the Chinese domestic to their markets. But having said that, a lot of Chinese automotive suppliers today are buying silicon carbide from the companies outside of China and so we think that we can play in China, both with non-domestic suppliers but also domestic suppliers over time. Domestic to China, if you will, right?

Christian Schwab: Correct. Correct. Great. Thank you for that. And just a quick — one last quick question. On the — as we — as far as backlog is concerned, would you expect kind of similar trajectory as last year, where we did have a very strong February quarter of backlog. We have worked through some of that and then enter the next fiscal year with a very strong idea of what the year will look like. Are we going to enter that do you believe with a really strong backlog number, too early to tell

Gayn Erickson: Yeah. I mean, we

Christian Schwab: objective for next year?

Gayn Erickson: We haven’t been doing a lot of it. We really don’t give quarterly guidance. But then if you give annual guidance on top of three quarters, it’s pretty clear what the quarter is. I realize but that’s still revenue focus. The reality is that, I see things picking up. There’s not a dwarf. There seems to be a lot of people accelerating their plans right now. We are having — we are putting out a lot of quotes. There’s a lot of people asking for lead times on top of each other and I believe we will go into next year with a lot more visibility than even last year. Having said that, it will be distributed across a much larger number of customers, which I guess there’s some averaging going on in terms of that — it’s not all or nothing with one or two customers, but we also think that the large customers are going to continue to buy.

So I don’t know how many different ways I can describe our optimism, but Aehr is — I mean, people are really recognizing the value that we add and are seeking us out in addition to us knocking on all the right doors and I am super enthusiastic about heading into next year.

Christian Schwab: Fabulous. No other question. Thanks, Gayn.

Gayn Erickson: Okay. Thanks, Christian.

Operator: The next question comes from Jed Dorsheimer with William Blair. Please go ahead.

Jed Dorsheimer: Hey. Thanks for taking my questions here, and Ken, I will echo the congrats.