Jim Byers - IR, MKR Group, Inc. Gayn Erickson - President and Chief Executive Officer Kenneth Spink - VP of Finance and Chief Financial Officer.

Christian Schwab - Craig-Hallum Capital Group LLC. Geoffrey Scott - Scott Asset Management Tom Diffely - D.A. Davidson & Co. Orin Hirschman - AIGH Investment Partners LP.

Good day, and welcome to the Aehr Test Systems’ Second Quarter Fiscal 2017 Financial Results Call. Today’s conference is being recorded. At this time, I’d like to turn the conference over to Mr. Jim Byers of MKR Group. Please go ahead, sir..

Thank you, operator. Good afternoon and thank you for joining us today to discuss Aehr Test Systems second quarter fiscal 2017 financial results.

By now, you should have all received a copy of today’s press release, if not, you may call the office of MKR Group, Investor Relations for Aehr Test, at 323-468-2300 and we will get a copy out to you right away. With us today from Aehr Test Systems are Gayn Erickson, President and Chief Executive Officer; and Ken Spink, Chief Financial Officer.

Management will review the company’s operating performance for the fiscal second quarter before opening the call to your questions. Before turning the call over to management, I’d like to make a few comments about forward-looking statements.

We will be making forward-looking statements today that are based on current information and estimates and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements.

Factors that may cause results to differ materially from those in the forward-looking statements are discussed in our most recent periodic and current reports filed with the SEC.

These forward-looking statements, including guidance provided during today’s call are only valid as of this date and Aehr Test Systems undertakes no obligation to update the forward-looking statements. With that said, I’d like to introduce Gayn Erickson, Chief Executive Officer..

Thank you, Jim. Thank you out there. Folks, just as a warning here I have a cough that seems to come up on me that I may have to mute, but if you wonder where random moves are coming from, that’s what it is. Thank you, everyone, for joining us on the conference call and also listening online.

Ken is going to go over the second quarter financial results later, but first, I’ll spend a few minutes discussing our business and product highlights, including our continued progress with the development and introduction of our new FOX-XP platform, which is our next-generation of wafer level test and burn-in products.

After that we’ll open up the lines for your questions. We had net revenues of $4.2 million for the quarter and $9.5 million for the fiscal year-to-date. This puts our revenue under the $4.6 million we reported for the second quarter last year and a $11.3 million for the first six months of fiscal 2016.

While our revenue year-to-date is down from last year, we continue to hold to our forecast for strong fiscal year-over-year growth in our revenue, bookings, and bottom line. Let me start off with our packaged part burn-in and test systems business.

As we noted on past calls, we’re encouraged to see a strengthening in our base business after several quarters of soft bookings and revenue. Our ABTS systems and services business still provides us with a base business of approximately $2 million to $3 million in revenue per quarter.

And I’m pleased to add that we’re currently working on some projects that could increase this business considerably, so likely not before our next fiscal year that begins on June 1. We expect to have more information to share on the potential of these projects in the next quarter or two, and I’ll keep you updated.

Moving onto our FOX Wafer Level Test and Burn-In business that includes our consumable WaferPak and DiePak contactors. We continue to make significant progress completing the development of our new FOX-P platform of both single and multi-wafer test and burn-in systems.

During the second quarter, we shipped multiple FOX-1P Single Wafer Level Test and Burn-in Systems to our lead customer for this product. The FOX-1P cost effectively addresses full wafer parallel testing of devices with long test times, including flash memories, microcontrollers, and automotive ICs.

This system has applications that include burn-in and/or test of wafers that have a need for significant test resources and can deliver over 16,000 individual power supplies or digital test signals with our unique FOX-P system architecture of Universal Channels.

This provides our customers with a never before offered test capability for devices, while still in a wafer form. We continue to see significant opportunities for the FOX-1P product line, however, let me try that again.

However, as we’ve discussed in past calls, we’ve consistently seen greater interest and considerably larger market opportunities for our Multi-Wafer FOX-15 and new FOX-XP systems. I’m really pleased with our progress on the FOX-XP Multi-Wafer and Burn-in Solution, and we expect to ship our initial FOX-XP test cell in the current fiscal third quarter.

This system is configured for testing 18 wafers in parallel and provides unprecedented capability for high power wafers, with 18 individual thermal chucks with temperatures up to 125 degrees Celsius or more. This application is for production burn-in of optical devices to be used in high performance server and data centers.

This is a very exciting new market that Aehr Test’s new FOX-XP system is uniquely positioned to address due to its ability to test and burn-in these devices while still in wafer form. This allows for an extremely low-cost and high-quality alternative to burning in these devices further downstream in module format.

We’re very optimistic about the prospects for this market for Aehr Test. We also continue to engage with our initial lead customer that purchased and accepted the first FOX-XP system in an engineering configuration earlier in 2016.

We are successfully demonstrating burn-in of their devices on the FOX-XP system in our factory today and continue to believe they will need systems to support their production burn-in requirements.

Most recently, we’ve received information from this customer that implies a slightly later ramp than we were originally understood with capacity shipments needed in the upcoming summer of 2017 rather than at the end of calendar first quarter.

However, this could change on short notice and we’re taking several steps to shorten our lead times and ensure we have the capacity to meet a range of capacity needs and forecasts. We remain optimistic about the opportunity to address this customer’s needs that span across multiple programs and applications.

I also want to draw attention to our shareholders and customers that our plan is to participate for the first time in SPIE Photonics West Conference and Exhibition taking place in San Francisco late this month.

SPIE is the world’s largest event focusing on photonics technologies and showcases the latest innovations across a wide range of technologies. We will be showcasing our solutions for both wafer level and module level burn-in and test of optical devices.

We continue to be very excited about the sensor and photonics markets, which we believe will be a significant market for Aehr Test.

As we’ve noted before, a key market driver for Aehr Test is the rapid automotive IC growth in sensors, control information and entertainment, which have substantially higher requirements for initial quality and long-term reliability.

There are many new programs in established automobile manufacturers as well as non-traditional startups in the automotive space, focused on autonomous vehicle technologies around the world right now.

This ranges from autonomy in the box for both on automotive autonomous driving through fully autonomous vehicles that don’t even have provisions for a driver.

I believe that this is an extremely interesting field that is going to drive an entirely new level of quality and reliability expectation of hardware systems and poses a very interesting long-term opportunity for Aehr Test Systems. We’re looking forward to a very exciting calendar year at 2017. With that, let me turn it over to Ken.

Ken?.

Thank you, Gayn. As Gayn noted, while our year-to-date revenue was down from last year, we continue to hold to our forecast for strong fiscal year-over-year growth in our revenue, bookings, and bottom line. Net sales in Q2 were $4.2 million compared to $5.3 million in the preceding quarter and $4.6 million in the second quarter of the previous year.

Included in Q2 net sales were revenues from FOX-1P systems, as well as multiple ABTS packaged parts system sales.

Non-GAAP net loss for the second quarter was $1.2 million, or $0.08 per diluted share, compared to a non-GAAP net loss of 436,000, or $0.03 per diluted share in the preceding quarter, and a non-GAAP net loss of 794,000, or $0.06 per diluted share in the second quarter of the previous year.

The non-GAAP results exclude the impact of stock-based compensation expense. On a GAAP basis, net loss for the second quarter was $1.5 million, or $0.09 per diluted share.

This compares to a GAAP net loss of 755,000, or $0.06 per diluted share in the preceding quarter, and a GAAP net loss of $1 million, or $0.08 per diluted share in the second quarter of the previous year. Gross profit in the second quarter was $1.5 million, or 35% of sales.

This compares to a gross profit of $2.2 million, or 41% of sales in the preceding quarter and a gross profit of $1.7 million, or 37% of sales in the second quarter of the previous year. The sequential decrease in gross margin from the preceding quarter primarily reflects the impact of product mix during the quarter.

In the second quarter, revenue from Burn-in systems and WaferPak contactors declined $1.4 million from Q1, which was partially offset by sequential increase of $400,000 in packaged parts system revenue, which has a lower margin.

Margins in Q2 were also negatively impacted by the increase in other cost of sales due to increases in warranty inventory reserve costs. Operating expenses in the second quarter were $2.7 million, essentially flat compared to $2.8 million in the preceding quarter, and up 111,000, or 4% from $2.6 million in the prior year second quarter.

The year-over-year increase reflects higher employment-related expenses due to increase in headcount. Operating expenses on a year-to-date basis were flat compared to the first six months of fiscal – of the last fiscal year.

R&D expenses of $1 million for the second quarter compared to $1.1 million in the preceding quarter and 923,000 in the previous year quarter. As stated previously, R&D spending can fluctuate from quarter-to-quarter depending on the development of our new products.

SG&A was $1.7 million flat compared to both the preceding quarter and the second quarter of the previous year. Turning to the balance sheet and changes during the second quarter, our cash and cash equivalents were $5.2 million at November 30, compared to $2.3 million at the end of the preceding quarter.

The significant increase from the preceding quarter reflects our successful private placement offering in September, which added net proceeds of $5.3 million to our cash balance. Cash balance at quarter end was also impacted by the net loss during the quarter and a reduction in customer deposits and deferred revenue of $1.7 million.

Accounts receivable at quarter-end was $1.4 million, compared to $1.8 million at the preceding quarter-end, reflecting lower sales levels. Inventories at November 30, were $6.1 million flat compared to the preceding quarter end. Property and equipment were 793,000 flat compared to 789,000 in the prior quarter.

Customer deposits and deferred revenue, short-term was $1.1 million compared to $2.7 million at the preceding quarter end. The decrease from prior quarter is primarily due to sales of systems with down payments.

As we announced in early October, during the quarter, the company satisfied the requirements for continued listing on the NASDAQ Capital Market. This concludes our prepared remarks. We’re now ready to take your questions. Operator, please go ahead..

Hey, solid quarter, guys. So, Gayn, just want to make sure I understood correctly. On the initial customer of the XP, we expect a slightly later ramp of that product. And so, can you tell me roughly when you would expect orders and shipments again? I missed that..

Well, we’re trying to avoid getting too specific here, both from a protection of potential customer information, but let me try and make it a little bit clear. So what I had shared in previous calls is that, we understood that their ramp would begin for the need for kind of production around capacity at the end of the first quarter.

So that was calendar quarter, so think of at the end of March to April. What we’ve heard now is that that’s more a June, July, August timeline, all three of those months actually. So it’s pushed out a couple of months or so. There’s still a high degree of variance between the programs and we are not being told everything.

That includes when they would need their initial production systems versus what the ramp itself looks like. But what we’ve been doing here in the factory is, we have been building up some amount of inventory. We’re actually building several systems in anticipation of the need for shorter lead times.

And so, we have the ability to meet some small volumes with short lead times and then typically our lead times for volume, capacity are still going to be in the 12 to 16-week timeframe.

So while we could ship onesies or twosies keep in mind, these ASPs are $2 million, $3 million plus larger ramps would be something that we would need longer lead times for.

Does that helps?.

Yes, that’s fair.

So given kind of multi programs, multi products, if the orders came in and they’re not pushed out or moved around would you expect the first-half of fiscal year 2018 revenue to be greater than that of the second-half of 2017 as a result of that?.

I – we’re trying to avoid long-term forecast, sorry, Christian, but it would be – that would be reasonable..

Yes, that would be logical, right?.

I mean, I think it’s a logical path. That’s correct..

Yes, I’m not asking for guidance. I just want to make sure that I’m thinking about it correctly. All right, awesome. I don’t have any other questions. Thanks, guys..

Thanks, Christian..

[Operator Instructions] We’ll go next to Geoffrey Scott with Scott Asset Management..

Good afternoon..

Hi, Geoff, good afternoon..

The ABTS systems that went out, you said last quarter that they were headed to the Philippines.

Was that the case with the shipments in Q2 as well, or did they go to multiple destinations?.

Ken is over here nodding that told me – reminds me, I’d said, it was to the Philippines. Okay, your question, are the rest of them going to the similar places. In general, most of our ABTS sales do go to Asia. I would say, typically half to Southeast Asia and half north of there. How’s that? But we do still ship systems into the U.S.

So I’m okay, we’re saying these have been the current backlog of systems are primarily going to Southeast Asia, how’s that?.

Okay.

Did I understand correctly that that you shipped a couple of FOX-1 systems?.

Sure. Yes, we – more than one, yes. But getting to - trouble with getting into too much detail there..

Okay..

I keep saying I’m not going to answer and then I answer it.

So I’m not doing very well here, okay?.

Yes.

The destination for those FOX-1s I take it they were for production as opposed to engineering?.

Yes, these were production configuration systems and they are shipped into the U.S..

Shipped into the U.S., okay. Last quarter you said that or at the last call, you said that Q2 revenue would be down somewhat which turned out to be pretty accurate.

Any comments on revenue for Q3, Q4, up, down sideways?.

What we’re sticking to is that, we are still going to be up. I think we said either considerably or from our last year’s revenue. So we did 14 something last year. We’re under 10 so far. You could anticipate that that’s, at least, what - you may want to determine significant more than $4 million, $5 million in the second-half for certain.

We’re actually expecting this quarter to be somewhat similar to this current quarter. There’s some range that could be slightly up or slightly down. There’s one of the big wildcards for certain has to do with some of the opportunities with the XP and how rev rec is going to happen with those.

We’re currently assuming that systems that are shipped in the quarter will not be recognized for revenue until Q4. And but there are some debate depending on how the timing of it and which customers they ship to..

Okay.

If I read between lines, if you do not get rev rec on the XP until Q4, but you say Q3 will be similar to Q2 then there must be a fairly significant backlog of your base business to get you through that?.

We have a backlog of base business. We have a forecast for additional ABTS systems that will be turns within the second-half. And we also believe that with customer orders, we have plenty of time to ship Fox XPs to customers in Q3 and Q4..

Okay, sounds good, congratulations. I’ll let somebody else on..

Thanks, Geoff..

[Operator Instructions] We’ll go next to Tom Diffely with D.A. Davidson..

Yes, good afternoon.

So first, on the push-outs of some expected orders, are you doing anything on the cost side, any expense changes of note because of the couple quarter delay?.

We are not at this point. We did, which is more of a historical thing than anything else. We had a company-wide shutdown over the break of which I – Ken and I were here most of it along with some manufacturing and some key R&D folks as well. So I would say, in general, we are holding steady. We are watching that.

But this is a really key time with the – getting the FOX-XP system out this quarter, which would be in February. We’re building up the – some inventory and we’re building up more than a couple of systems the FOX-XP for other applications, and there’s a lot of stuff going on here. So people are very busy.

R&D spend is actually up a little bit, both in headcount and expenses. Some of the incremental expenses that we’re doing incurring with respect to the – to test out all of these systems across multiple applications is showing up in their R&D expenses right now..

So is it more of a final test procedure going on right now, or are you actually changing some of the engineering or products features, if you will, on the XP?.

Very much final test. We are getting in final rev boards, blades, chambers, subsystems. When you get into our WaferPaks and our DiePaks that are used in the FOX-XP, those are custom to specific applications.

We’ve got test load boards and all that are brought in that typically are one-time expenses and they’re used for characterization and then ultimately can be used in manufacturing, as part of the final test procedures. So this is not uncommon with where we’re at.

We do anticipate that we’ll be through the bulk of that development of the FOX-1P and XP really this quarter. And so, the expense-related items, the fixed stream, the one-time things, I would expect that to go down in Q4..

Okay.

So the delay here wasn’t driven by the customer looking for additional features?.

That is true..

Okay..

That is true. We have that more on the FOX-1P. On the XP, we’ve – the system is very capable and if anything it’s been a pleasure.

We’ve have direct feedback from customers that were almost to the effect of a pleasant surprise, where they’re able to provide us with devices and literally within days we’re able to do test and characterize those devices on the FOX-XP system, which in their mind is very impressive.

So now we’re – it’s been working really well for us in these spaces..

Okay. And then you’d mentioned the inventory build – there’s some inventory, it looks like the inventory was pretty stable during the quarter.

Would you expect it to take a step function higher in the current quarter?.

I won’t say step function. We did a little bit of a shifting. So we shift off some FOX-1s, some ABTSs, and then we added in some FOX-XP and ABTS material. I’d actually think our inventory is going to go up this quarter inversely proportional to win the ship systems, because we’re absolutely are bringing on XP inventory in anticipation of shipping that.

And when we do then it ships out the door. It will – it will be a balance, because it would be our expectation that initial systems are followed on with production systems. And so as we have discussed in the past, the typical challenge is how do you manage your cash in that scenario.

We continue to hold to our 30% down payment from key customers and have managed to hold out with all of our large system deals..

Okay..

So that helps us with the inventory. It helps them lock in their commitments and ensures that, we’re not having to go borrow money against inventory..

Okay.

And finally, you mentioned in the press release that the XPs are going to be optical side or 18 wafer capable, is that the common size going forward, or is that a variable?.

The top two configurations that we have right now are actually 9 and 18. To some extent, the 18 blades typically have fewer resources in them and the nine blades have more. So ASPs aren’t that different from each other. But these are large production systems, they’re impressive..

Okay.

Do you expect something in the 9 or 18 involved with the first FOX-XP customer when they came around?.

That’s right..

Okay..

Those are the typical configuration. The system is configurable down to a single blade and you can buy them one blade at a time. So there are examples where customer may want to start with a single blade and then they can upgrade in the field up to additional 18 blades to add capacity.

It’s a great model too, because it’s very, I mean, you could add a blade of capacity within a day or two, I mean, hours, right. And so and that capacity in historic terms could represent an entire ATE system. So there are certain applications, where you could say, this is 18 testers in one.

But we could, while it may take us 12 or 16 weeks, in general, for to build a full-chambered system, may be less for a single blade system, incremental blades will be shorter lead times. And so it allows us to actually ramp customers and add incremental capacity, it’s one of the features the customers really like..

Okay. And then on the optical side, you said, you were going to go over to SPIE, as well.

What is the potential customer base look like in that space, or how many potential customers do you think out there for you?.

I will tell you some of this is our own learnings through our customers and our customer’s customers and suppliers that there’s a lot of really interesting things going on there. I mentioned the stuff going on with optical in sensors and cars. We do those today.

There are things like LIDAR and all that are just that are, as an engineer, are exciting to sit and talk with the people about where that technology is going.

And then there are things that are going in mobile devices that are very high volumes that are using technologies for the types of companies that are actually showing their wares at this type of show.

This is our first time, we’ve been sort of quietly engaged with several of those customers, but this will be our first public time out there to talk about these products. We’ll now have an XP that we – are effectively have shipped both engineering and now production systems.

And we’re in a really good position to have those customers come into our factory and see examples of the kind of things that we can do to do these massive parallelism. The thing about these devices, it’s interesting and there – there’s different things from LEDs to pixels to lasers to photonics devices.

But one of the common threads is a combination of the reliability of those devices. There is a higher than what I would say average being silicon infant mortality. So in an application, where the reliability is important, they need to do some sort of a burn-in step.

In many of the applications, there’s also examples, where the parametrics of the device think of like the light output power will vary within the first say 100 hours of use. And that variance can have an impact.

There are high-speed communication devices that if you were to ship them without going through an aging process, 100 hours later, they would no longer be tuned and you might drop from 100 gig to a 10 gig or 50 gig transmission, it’s a big deal.

So you need to do an extended live test on these or burn-in test to be able to weed out or cherry pick, or in this case just pick from a bunch to get the proper parametrics. We’ll be talking about that at the show and that’s just a – it’s just a very interesting area.

And traditionally, there’s not really good methods for doing it, except for to put it into the actual end use module and trying to burn it in for 100 hours, and that would be horrifically expensive alternative. So we have been doing this for years on our FOX-15.

And there’s some new applications in terms of parallelism and power that the XP is exceptionally well-suited for that we think will give us a – this is a pretty neat and exciting opportunity for Aehr Test..

Great. Well, thanks for your time today..

Our next question we’ll go to Orin Hirschman with AIGH Investment Partners..

Hi, how are you?.

Hi, how are you?.

Mostly in terms of, you did mention maybe you want to, but you mentioned in terms of the shipments that have been done.

What’s revenue recognition dependent on in terms of this being considered a new product customer acceptance, how should we think about that? And is there a clear focus for you?.

Well, usually Ken and I’ll have these conversations, or we have a written policy that we stick to it, I think it’s a very consistent with the ATE space. This is a similar policy that we had in Hewlett-Packard and Energy [ph] and Agilent before I was here.

And what we’ll do is for a new system platform, we will wait until a customer acceptance from them most of the time that happens after installation at their site, sometimes it can happen before that, where they basically fully sign off on the functionality and capability of that tool before we will recognize the revenue of that system.

For follow-on systems, either to that customer or to another customer, the standard process is, the revenue recognition is upon transfer of title.

Most of those that happen at our factory when the customer comes and picks it up and takes ownership, or in those cases, where we ship it to the customer then it would transfer title when it gets to the customer. So it is typically only associated with a new product.

And one of the over under for us is, we’ve already shipped to FOX-XP for revenue to a customer, but it was in the engineering configuration. And so there’s some discussion going on around to the same customer. Do we need additional acceptance, or are we okay? Would it take a new customer, and so we’re kind of working to that right now.

These are the rev recs and they certainly sharpen your P&L. In many cases, this isn’t a cash event, because our financial terms include down payments and then most payment is due upon shipment. And only on the first tool, we defer maybe 10% or 20% for final acceptance. So while rev rec may not happen, we may already be sitting on 80% of the cash.

Does that make sense?.

Okay. That was helpful. I mean does this, I realize you can wait until a quarter unfolds.

And this give you very good visibility for, let’s say in Q4 of this year?.

It would. For example, that’s right. And the interesting byproduct of the process that we do consistently is, we could ship multiple systems and get – as soon as the first person recognizes revenue then the other ones recognize revenue automatically. It’s – I won’t say a SOCs thing, but this is just a standard GAAP accounting process.

So it makes it a little interesting at times like this. And that’s why I’m not trying to hedge my bet.

There could be a scenario, where you get acceptance on a first XP system from a customer, the second one goes out the door the next day and it gets acceptance immediately, where there’s no – if you follow the whole rev rec as many of the folks online do, the whole thing about the rev rec and SAB 101 came about early on in the 15 years ago in the software world, where there was a whole issue with respect to claiming you shipped the software and you sent a CD, but the rev, it was – there was a free upgrade.

I’ll give you a patch six months later, so win was the product really completed. If you talk with the auditors, we have this large two-ton piece of chamber full of electronics that’s either in the house, or it moves to the customer.

It’s pretty easy to see that we’re shipping things and also it’s not much of a deal in the large capital equipment space..

Okay. One other additional question, you’ve mentioned in the show that there’s going to be showing off new optical sensors that we will be using by handsets and multiple handset manufacturers.

Is that like your dreams type of testing – test scenario, because they’re so tiny, or they’re generally not going to never put online and even offline, that really statistically test this as opposed to doing really that we do need that support caring at their failure rate is critical from the end product kind of your dream type of test on the ship?.

Yes. And it’s gets into an interesting discussion, and I realized many of my customers are listening. But if you’re a tester guy, your ideal scenario is something that takes a really long time to test and has a reasonable amount of failures. If it never failed, you would stop testing it.

So there is a sense of those devices that inherently to the process itself like we talked about the optical devices flash memories, for example, they inherently are incapable of being built, so that they do not fail.

But once you go through a certain amount of test, their failure rate drops to a point where they are extremely reliable for a long period of time. Those are pretty ideal for us. Then of course, the other one is, we want devices where there’s a whole lot of them.

And if you look at units whether it be the automotive space really mobile these days handsets, tablets, those are still one of the key drivers this drives whether they be solid-state hard disk drives and a reliability expectations of those – those types of devices are usually your highest volume ones..

And that was the application you’re referring to the show this year for the first time you mentioned?.

Correct, correct. We both and we have both mobile applications. We have and server-type applications. One of the new applications for the FOX-XP and the server optical devices is expected to have a significant growth over the next decade. And I suppose that we’ll talk more about that over the next couple of quarters.

But it’s just a very interesting space if you start to look at kind of think of fiber-optic backplanes replacing copper, or typical electrical backplanes and what that can do. And if you follow the server forms, the Google forms and all, how much of everything is going to fiber optic.

We test those parts Those fiber optic transceivers inherently need to go through an 18 and burn-in process, and we’re exceptionally well-suited to do that at wafer level..

Okay.

And can you say on that application for the handset application, the sensors will be met more than one customer, or only one customer?.

Well, we do have more than one customer. And customer, let’s be careful, we have more than one customer today that already bought and have taken revenue et cetera, and then we are engaged with a pretty wide number of new customers more than a handful and….

Are the customers – for the customers, I’m sorry, go ahead..

Yes, and some of those are tied together with a common interest with yet another one of our customers and some are not. And one thing that we’re aware of right now is, there is a significant amount of opportunities out there and I will state one of our challenges can even be our channel.

Do we have enough feet on the street to be able to address all of the requirements? We are absolutely prioritizing. And that I think is a frugal appropriate thing to do, given where we are in our financials. But we do have the opportunity that as we grow in revenue, we can add resources, which we believe will allow us to address larger markets.

We have a – we believe a significant IP in terms of patterns and in terms of domain knowledge and technology lead in this space. So, we’re trying to pick off the key top players first, and then we’ll expand to they’re not even second-tier players.

I mean, you’re talking about most everyone we’re talking about are top ten semiconductor manufacturers, or in the photonics a big sort of space, the top few of those..

But if the customer for you, for you – let’s say, for your customers today, for example, with a multiple, let’s say, for those two customers the OEM have been in the – something on the mobile device for the customer again making the needful from both?.

We have engaged with all of the above..

Okay. Thank you..

[Operator Instructions] And it appears there are no further questions at this time. Mr. Erickson, I’d like to turn the conference back to you for any additional or closing remarks..

Okay. Well, we really appreciate it and appreciate everybody joined in on the call here, wish you all Happy New Year. I think I close with that I really mean it. This is going to be a very interesting and exciting year for Aehr Test, and we are looking forward to keeping you guys appraised at our quarterly updates.

As always, if you have any questions, feel free to contact the MKR folks or give us a call or an e-mail. And if we’re happy to be in Silicon Valley Bay area, I want to stop by, we are always open to give people a tour and let – give a little bit more information about what we’re doing here. Thank you very much and have a good day. Bye-bye now..

This does conclude today’s conference. Thank you for your participation. You may now disconnect..