What happened
Shares of Aehr Test Systems (AEHR 0.09%), a supplier of semiconductor test and reliability qualification equipment, were soaring today after the company announced a new production order from a major semiconductor customer.
Investors were eager to hear the news and drove the tech stock up by 15.6% as of 3:17 p.m. ET.
So what
Aehr said today that it received an order from a major silicon carbide semiconductor customer for its WaferPak products and that shipments of the order will begin in the current quarter.
Gayn Erickson, CEO of Aehr, said in a press release that the product purchase will be "for use in volume production of devices to meet the incredible demand for silicon carbide power semiconductors used in power conversion applications for electric vehicles."
Aehr investors likely also paid close attention to additional comments made by Erickson. He said he believes this same customer will also purchase "a large number" of the company's FOX-XP semiconductor test system "to meet their publicly announced significant increase in planned capacity and revenue growth over the next several years and through the end of the decade."
Aehr's equipment is used in the production of silicon carbide (SiC) chips, which is expected to see increased demand thanks to higher production rates of electric vehicles. Research from Yole Group estimates the SiC device market will grow from $1.1 billion in 2021 to more than $6 billion by 2027.
Now what
Investors will get a better look at how the company is doing when it reports its third-quarter financial results on March 30. But until then, it's clear Aehr shareholders are very happy with the company's current ability to win new orders from existing customers.
