AEM Holdings

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Most semiconductor plays on the local bourse are contract manufacturers and fortunes closely tied to its marquee customer,  normally a major player themselves. AEM Holdings's marquee customer is Intel and so its fortunes are closely tied to Intel's capex spending on new fabs (with testing facilities). Intel account for 90% of the revenue from AEM's most exciting/lucrative Testing Solutions BU.

AEM share price has dropped ~55% YTD, and ~-70% compared to its 2021-2022 peak. Now, the purchase of CEI (using cash/shares) look astute on hindsight. CEI will help to generate contract mfg profit in the current trough.

Intel to cut 15% jobs, suspend dividend in turnaround push; shares plummet

On Thursday, Intel announced it would cut operating expenses and reduce capital expenditure by more than $10 billion in 2025, more than it initially planned.

https://www.reuters.com/technology/intel...024-08-01/

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AEM's original marque customer Intel started to ramp its orders with AEM some time in 2016, after first engagement in 2010. AEM's new marque customer is not named but AEM has described them as "fabless AI/HPC", and so the Market/my guess is AMD. Based on my own notes, this customer was probably engaged some time in 2022, which was the last peak in AEM's revenue.

Nonetheless, interesting to see that the "AI effect" has increased its share price beyond 2021/2022's peak despite guided revenue (not split out between test cell solutions and contract mfg) still ~20-30% lower than the peak.

AEM Reports Strong 1Q FY2026 Results Driven by AI/ HPC Production Ramp, Revises Revenue Guidance Upwards

• 1Q2026 revenue increased 35.8% year-on-year to S$116.9 million
• Profit before tax rose to S$17.8 million, with PBT margin expanding to 15.2%
• Test Cell Solutions revenue grew 72.0% year-on-year, driven by AI/HPC production deployments
• FY2026 revenue guidance raised by approximately 20% to S$550 million to S$600 million

The Group's fabless AI/HPC customer continues its high-volume production ramp and is on track to become its largest customer in FY2026. Concurrently, the Group’s PC/Foundry customer is seeing a healthy recovery in demand, with order momentum improving into 2026.

Announced in 1Q2026, the Group’s strategic partnership with ASE Technology Holding (“ASE”), the world’s largest Outsourced Semiconductor Assembly and Test (“OSAT”) services provider, brings together the Group’s proprietary high-parallel test solutions and advanced thermal management capabilities with ASE’s global scale to advance next-generation AI/HPC test solutions and open up new opportunities, such as hyperscaler clients to the Group. The Group has been engaging with ASE and expects first deployment of its solutions in late 2026.

https://links.sgx.com/FileOpen/AEM_1Q202...eID=888708

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AEM ex CEO Mr Chok (2018-2020) and currently still on the BOD as NINED has sold ~60% of his stake with AEM share price performing like a rocket over the past few months.

NOTIFICATION FORM FOR DIRECTOR/CHIEF EXECUTIVE OFFICER IN RESPECT OF INTERESTS IN SECURITIES

Chok Yean Hung
No. of ordinary voting shares/units held: 1,102,044
No. of ordinary voting shares/units held: 402,044

https://links.sgx.com/FileOpen/_Form%201...eID=889209

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Nowadays, more companies are providing revenue/dividend guidance or order book. But AEM was one of the first few to provide revenue guidance on the SGX. Now it is the first to provide EPS guidance.

‘We wanted to assure investors of our trajectory’: AEM offers rare EPS guidance amid growing AI demand

The semiconductor test-equipment maker issued full-year 2026 EPS guidance of S$0.245 to S$0.275, alongside its half-year results, earlier this month. This was its first such forecast and marked a rare level of specificity among listed players here.

“I was getting congratulated by some of our analysts because we were the first one to issue an EPS projection (as an absolute range) in the history of” the Singapore Exchange (SGX), AEM chief executive Samer Kabbani told The Business Times.

AEM continues to see strong demand from its existing fabless AI and high-performance computing (HPC) customer. Although it has not disclosed the customer’s identity, most research reports identify it as semiconductor giant global semiconductor manufacturer AMD. This quarter, AEM also announced that a personal computer and foundry customer had adopted its flagship Asynchronous Modular Parallel Smart (AMPS) platform for future test requirements. Together, the two customers now account for more than S$400 million in AMPS backlog, Kabbani said.

Beyond its PC and foundry as well as HPC and fabless AI customers, AEM is targeting the memory, outsourced semiconductor assembly and test (Osat), and contract manufacturing segments. For now, Kabbani said the company remains focused on its first two verticals, although memory and Osat could become larger contributors over time.

AEM is particularly bullish on Osat; it has partnered Advanced Semiconductor Engineering (ASE), the world’s largest Osat provider. Kabbani noted that ASE’s selection of AEM after extensive due diligence is a strong endorsement of the company’s technology. He said: “If you think about it, (why would a Taiwanese Osat provider) come to Singapore and pick a supplier? It is a testament to what we do and what we offer in this market.”

https://www.businesstimes.com.sg/compani...-ai-demand