aehr_10q.htm

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the quarterly period ended February 27, 2026

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the transition period from _______________ to ______________

Commission File Number 000-22893

AEHR TEST SYSTEMS

(Exact name of Registrant as Specified in its Charter)

California		94-2424084
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

400 Kato Terrace, Fremont, CA		94539
(Address of Principal Executive Offices)		(Zip Code)

(510) 623-9400

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Exchange Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock par value of $0.01 per share	AEHR	The NASDAQ Capital Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

There were 31,453,254 shares of the Registrant’s Common Stock outstanding as of April 1, 2026.

TABLE OF CONTENTS

		Page
PART I FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)		3
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		19
Item 3. Quantitative and Qualitative Disclosures About Market Risk		25
Item 4. Controls and Procedures		25
PART II OTHER INFORMATION
Item 1. Legal Proceedings		26
Item 1A. Risk Factors		26
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		26
Item 3. Defaults Upon Senior Securities		26
Item 4. Mine Safety Disclosures		26
Item 5. Other Information		26
Item 6. Exhibits		27
SIGNATURES		28

Table of Contents

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements (unaudited)

AEHR TEST SYSTEMS
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
	February 27,			May 30,
(In thousands, except par value)	2026			2025
ASSETS
Current assets:
Cash and cash equivalents	$	36,911		$	24,529
Accounts receivable		11,808			14,191
Inventories		41,162			41,997
Prepaid expenses and other current assets		6,019			8,061
Total current assets		95,900			88,778
Property and equipment, net		9,277			8,969
Goodwill		10,719			10,719
Intangible assets, net		9,847			10,781
Deferred tax assets, net		21,883			19,114
Operating lease right-of-use assets, net		9,089			9,601
Other non-current assets		331			546
Total assets	$	157,046		$	148,508
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	2,103		$	6,728
Accrued expenses and other current liabilities		4,176			6,020
Operating lease liabilities, short-term		606			909
Deferred revenue, short-term		1,857			1,981
Total current liabilities		8,742			15,638
Operating lease liabilities, long-term		9,419			9,921
Deferred revenue, long-term		53			36
Other long-term liabilities		40			42
Total liabilities		18,254			25,637
Commitments and contingencies (Note 6)
Shareholders’ equity:
Preferred stock, $0.01 par value: Authorized: 10,000 shares;
Issued and outstanding: none		-			-
Common stock, $0.01 par value: Authorized: 75,000 shares;
Issued and outstanding: 30,954 shares and 29,877 shares at February 27, 2026 and May 30, 2025, respectively		310			299
Additional paid-in capital		170,143			145,758
Accumulated other comprehensive loss		(84	)		(126	)
Accumulated deficit		(31,577	)		(23,060	)
Total shareholders' equity		138,792			122,871
Total liabilities and shareholders’ equity	$	157,046		$	148,508

See accompanying Notes to Condensed Consolidated Financial Statements (unaudited)

Table of Contents

AEHR TEST SYSTEMS
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

	Three Months Ended						Nine Months Ended
	February 27,			February 28,			February 27,			February 28,
(In thousands, except par value)	2026			2025			2026			2025
Revenue	$	10,313		$	18,307		$	31,166		$	44,879
Cost of revenue		6,945			11,124			21,534			25,218
Gross profit		3,368			7,183			9,632			19,661
Operating expenses:
Research and development		3,167			3,140			8,988			7,777
Selling, general and administrative		4,430			5,162			13,581			14,357
Restructuring charges		-			-			6			-
Total operating expenses		7,597			8,302			22,575			22,134
Loss from operations		(4,229	)		(1,119	)		(12,943	)		(2,473	)
Interest income, net		240			270			613			1,179
Other income (expense), net		(12	)		(25	)		1,049			(11	)
Loss before income tax benefit		(4,001	)		(874	)		(11,281	)		(1,305	)
Income tax benefit		(798	)		(231	)		(2,764	)		(294	)
Net loss	$	(3,203	)	$	(643	)	$	(8,517	)	$	(1,011	)

Net loss per share:
Basic	$	(0.10	)	$	(0.02	)	$	(0.28	)	$	(0.03	)
Diluted	$	(0.10	)	$	(0.02	)	$	(0.28	)	$	(0.03	)
Shares used in per share calculations:
Basic		30,695			29,733			30,265			29,500
Diluted		30,695			29,733			30,265			29,500

See accompanying Notes to Condensed Consolidated Financial Statements (unaudited)

Table of Contents

AEHR TEST SYSTEMS
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(Unaudited)

	Three Months Ended						Nine Months Ended
	February 27,			February 28,			February 27,			February 28,
(In thousands)	2026			2025			2026			2025
Net loss	$	(3,203	)	$	(643	)	$	(8,517	)	$	(1,011	)
Other comprehensive income (loss), net of tax:
Net change in cumulative translation adjustment		26			10			42			(23	)
Comprehensive loss	$	(3,177	)	$	(633	)	$	(8,475	)	$	(1,034	)

See accompanying Notes to Condensed Consolidated Financial Statements (unaudited)

Table of Contents

AEHR TEST SYSTEMS
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(Unaudited)

										Accumulated
							Additional			Other						Total
	Common Stock						Paid-in			Comprehensive			Accumulated			Shareholders'
(In thousands)	Shares			Amount			Capital			Loss			Deficit			Equity
Three Months Ended February 27, 2026
Balances, November 28, 2025		30,624		$	306		$	158,954		$	(110	)	$	(28,374	)	$	130,776
Issuance of common stock in public offering		269			3			10,220			-			-			10,223
Issuance of common stock under employee plans		79			1			57			-			-			58
Shares repurchased for tax withholdings on vesting of restricted stock units		(18	)		-			(453	)		-			-			(453	)
Stock-based compensation		-			-			1,365			-			-			1,365
Net loss		-			-			-			-			(3,203	)		(3,203	)
Foreign currency translation adjustment		-			-			-			26			-			26
Balances, February 27, 2026		30,954		$	310		$	170,143		$	(84	)	$	(31,577	)	$	138,792

										Accumulated
							Additional			Other						Total
	Common Stock						Paid-in			Comprehensive			Accumulated			Shareholders'
(In thousands)	Shares			Amount			Capital			Loss			Deficit			Equity
Nine Months Ended February 27, 2026
Balances, May 30, 2025		29,877		$	299		$	145,758		$	(126	)	$	(23,060	)	$	122,871
Issuance of common stock in public offering		653			7			19,588			-			-			19,595
Issuance of common stock under employee plans		482			5			1,120			-			-			1,125
Shares repurchased for tax withholdings on vesting of restricted stock units		(58	)		(1	)		(1,272	)		-			-			(1,273	)
Stock-based compensation		-			-			4,949			-			-			4,949
Net loss		-			-			-			-			(8,517	)		(8,517	)
Foreign currency translation adjustment		-			-			-			42			-			42
Balances, February 27, 2026		30,954		$	310		$	170,143		$	(84	)	$	(31,577	)	$	138,792

See accompanying Notes to Condensed Consolidated Financial Statements (unaudited)

Table of Contents

AEHR TEST SYSTEMS
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(Unaudited)

									Accumulated
						Additional			Other						Total
	Common Stock					Paid-in			Comprehensive			Accumulated			Shareholders'
(In thousands)	Shares			Amount		Capital			Loss			Deficit			Equity
Three Months Ended February 28, 2025
Balances, November 29, 2024		29,709		$	297	$	142,593		$	(191	)	$	(19,518	)	$	123,181
Issuance of common stock under employee plans		83			1		62			-			-			63
Shares repurchased for tax withholdings on vesting of restricted stock units		(22	)		-		(177	)		-			-			(177	)
Stock-based compensation		-			-		1,776			-			-			1,776
Net loss		-			-		-			-			(643	)		(643	)
Foreign currency translation adjustment		-			-		-			10			-			10
Balances, February 28, 2025		29,770		$	298	$	144,254		$	(181	)	$	(20,161	)	$	124,210

									Accumulated
						Additional			Other						Total
	Common Stock					Paid-in			Comprehensive			Accumulated			Shareholders'
(In thousands)	Shares			Amount		Capital			Loss			Deficit			Equity
Nine Months Ended February 28, 2025
Balances, May 31, 2024		28,995		$	289	$	130,612		$	(158	)	$	(19,150	)	$	111,593
Issuance of common stock for business acquisition		552			6		9,375			-			-			9,381
Issuance of common stock under employee plans		267			3		891			-			-			894
Shares repurchased for tax withholdings on vesting of restricted stock units		(44	)		-		(520	)		-			-			(520	)
Stock-based compensation		-			-		3,896			-			-			3,896
Net loss		-			-		-			-			(1,011	)		(1,011	)
Foreign currency translation adjustment		-			-		-			(23	)		-			(23	)
Balances, February 28, 2025		29,770		$	298	$	144,254		$	(181	)	$	(20,161	)	$	124,210

See accompanying Notes to Condensed Consolidated Financial Statements (unaudited)

Table of Contents

AEHR TEST SYSTEMS
Condensed Consolidated Statements of Cash Flows
(Unaudited)
	Nine Months Ended
	February 27,			February 28,
(In thousands)	2026			2025
Cash flows from operating activities:
Net loss	$	(8,517	)	$	(1,011	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense		4,896			3,741
Depreciation and amortization		2,110			1,573
Deferred income taxes		(2,769	)		(293	)
Amortization of operating lease right-of-use assets		543			795
Changes in operating assets and liabilities:
Accounts receivable		2,387			(962	)
Inventories		203			(2,211	)
Prepaid expenses and other assets		457			(4,831	)
Accounts payable		(3,476	)		139
Accrued expenses		(38	)		(515

SEC Form 10-Q filed by Aehr Test Systems