Aehr Test Systems (AEHR) 2007 Q2 法說會逐字稿

Welcome to the Aehr Test Systems Second Quarter 2007 Conference Call.

At this time, all participants are in a listen-only mode, following today's presentation instructions will be given for the question and answer session. [OPERATOR INSTRUCTIONS] In the meantime, should anyone require an operators' assistance at any time during the conference, you may press the star followed by the zero on your push button phone.

As a reminder, this conference is being recorded, today Thursday the 4th of January, 2007.

I would now like to turn the conference over to Mr. Tony Ross, from the Financial Relations Board, please go ahead.

Thank you, operator.

Good afternoon, and thanks for joining us to discuss Aehr Test Systems results for the second quarter of fiscal 2007.

By now you should of all received a copy of today's press release.

If not, you can call my office at 310-854-8300, and we'll get one to you right away.

With us today from Aehr Test, are Rhea Posedel, Chairman and Chief Executive Officer and Gary Larson, Vice President of Finance and Chief Financial Officer.

Management will review its operating performance for the quarter before opening up the call to your questions.

I'd like to note that Gary and Rhea are in separate offices today so please bear with us if there are any pauses during the Q&A session.

I would now like to turn the call over to Gary Larson.

Go ahead, Gary.

Thanks, Tony.

And thank you, to everyone, for joining us today.

Hope you all had a Happy New Year.

Before we begin, I'd like to make a few comments about forward-looking statements.

Please be advised that during the course of our discussions today we may make forward-looking statements that involve risks and uncertainties relating to projections regarding industry growth and customer demand for Aehr Test products as well as projections regarding Aehr Test's future financial performance.

Actual results may differ materially from projected results and should not be considered as an indication of future performance.

These risks and uncertainties include without limitation economic conditions in Asia and elsewhere, world events, acceptance by customers of our FOX, MTX, MAX and DiePak technologies and conversion of quote activity to purchase orders and acceptance by customers of products shipped upon receipt of a purchase order, the ability of new products to meet customer needs or performance described.

The Company's development and manufacture of a commercially successful wafer level test and burn-in system and the potential emergence of alternative technologies, each of which could adversely affect demand for Aehr Test products in calendar year of 2007.

We refer you to our most recent 10-K and 10-Q reports and other reports filed from time to time with the Securities and Exchange Commission for a more detailed description of the risks facing our business and factors that could cause actual results to differ materially from projected results.

The Company disclaims any obligation to update information contained in any forward-looking statements to reflect events or circumstances occuring after the date of this conference call.

Now I'd like to introduce our Chairman and CEO, Rhea Posedel.

Rhea?

Thank you, Gary.

Welcome to our Conference Call for the Second Quarter of our Fiscal 2007.

We are pleased to report our 5th profitable quarter in a row, despite total net sales that came in somewhat lower than our expectations.

Net sales for the second quarter were 6.2 million, up 7% over the same quarter of last year although sequentially lower than the prior quarter.

The revenue shortfall is attributable to lower than expected shipments of our MAX family of burn-in systems to Texas Instruments, one of our largest recurring customers.

During our multi-year relationship with TI, they have typically bought a number of systems each quarter although there have been times where they have had a pause in buying, as occurred in the second quarter.

We expect to see their normal buying pattern to resume later in calendar 2007.

On a positive note, we continue to see increased demand for our FOX four-way for parallel tester.

On September 26, we announced receiving over $4 million in orders for our FOX 1 parallel tester and 4-way for contactors.

Today we announce other follow-ons orders from this customer for multiple FOX 1 parallel testers and contactors totaling over $6 million.

Importantly, these FOX 1 system orders include systems for parallel testing 300 millimeter fab wafers -- flash wafers.

What's key about this new FOX 1 system order is that these systems are going into a new 300 millimeter fab site scheduled to come online in the latter half of calendar 2007.

If our FOX 1 systems can demonstrate the expected cost saving -- [inaudible] we could expect sizable follow-on orders to support this fab's forecasted requirements for wafer probe testing.

We are proud to say we ship 2 FOX 1 testers during the second quarter.

The first tester shipped to an engineering site and the second FOX 1 tester shipped to a production 200 millimeter fab for testing flash wafers.

We would expect to receive additional orders from this fab once our FOX 1 tester demonstrates success running in a production environment.

In addition, as we continue to work more closely with our initial FOX 1 customer, we are finding there are more unique wafer designs than we originally thought.

Initially, we were expecting about 1 or 2 contactors per system, but now we believe it will be in the range of 3 to 4 per system.

The good news is that this should add additional revenue for custom contactors as our installed base of FOX 1 systems increases.

To help us accommodate this increased demand, we have started adding resources to our design team and we are pleased with the engineering talent we have been able to add in the last few months.

We also feel very positive about the development progress we made in our FOX14 wafer level test and burn-in product .

As we announced last March, we received a multi-million dollar order for the FOX 14 wafer level burn-in and test system for a leading automotive IC producer.

This FOX 14 will be a newly designed system using a next generation hardware software platform based on FOX 1 technology.

We expect to deliver this system by mid year of calendar 2007.

In addition, we are enhancing our patented wafer pak cartridge design to provide lower cost, higher power and 300 millimeter wafer capability.

We believe this newly designed multi-FOX system will enable us to penetrate a broad range of IC manufactures for their wafer level burn and test needs.

Overall, the demand for our family of test and burn-in systems for package parts outside of Texas Instruments remains stable.

We continue to receive multiple MAX system auditors from automotive IC burn-in applications.

In the MAX product family comprised the bulk of our revenues in the second quarter.

In closing, we continue to be encouraged by the strong demand we see for our FOX products over the long-term.

We are taking a very targeted approach to business development and focusing on those IC manufacturers that we know have devices that are good matches for our FOX systems.

We have a goal of adding a minimum of one more customer for each of the FOX 1 and FOX 14 systems during the coming calendar year.

Even though we are cautious about the outlook for our core MAX and MTX products for the next couple of quarters, we see the demand for our FOX products increasing and making up for any temporary shortfalls in core product shipments.

Our challenge over the next few quarters will be working with our supply chains to ramp up capacity for the FOX 1 testers and full wafer contactors.

Now I'd like to turn the call over to Gary and he will add some color on the Q2 financials.

Gary?

Thanks, Rhea.

Net sales increased 7.4% to $6.2 million from $5.8 million in the second quarter in fiscal 2006.

Net sales were down sequentially on the quarter as Rhea discussed earlier.

Gross margin was 47% for the second quarter, essentially flat with both the prior year and the prior quarter period.

SG&A was $1.5 million in the second quarter, flat with the same period of the prior year.

Included in SG&A this quarter was $96,000 in stock compensation expense pursuant to our adoption of FAS123R.

Second quarter 2007 R&D expense was 1.5 million, up from 1 million in the second quarter of last year.

This increase is related to development of the FOX family of systems and custom contactors and of other new products.

Also included in R&D was $65,000 in stock compensation expense.

We had $651,000 in other income this quarter as we've indicated before, we hold partial ownership in the Singaporean Company, called ESA Electronics.

In 2003 we sold a portion of our ownership position in the ESA and there was an earn out contingency included as part of the consideration.

The performance targets were substantially achieved and the other income this quarter primarily consists of the recognition of the earn out payment.

We do not anticipate any further gains from this transaction.

Our net income for the second quarter was $687,000 or $0.08 per share compared with net income of $166,000 or $0.02 per share a year ago.

Excluding $176,000 in stock compensation expense, net income in the second quarter of fiscal 2007 was $856,000 or $0.10 per share.

We continue to have a strong balance sheet.

Our cash, cash equivalence, and short-term investments increased to $12.1 million at November 30, 2006.

Up over $1 million from our fiscal year-end.

Shareholders' equity was $20.9 million or $2.69 per share outstanding at November 30, 2006.

And we continue to have no outstanding debt.

We expect revenues in the third quarter to be relatively similar to those of the prior quarter.

And we expect a solid increase in our full-year fiscal 2007 net sales.

We're now ready to answer your questions.

Operator, please go ahead.

All right.

Thank you, sir. [OPERATOR INSTRUCTIONS] And that's coming from Ramesh Misra with Unterberg Towbin.

Please go ahead.

Hi, Ramesh.

Good afternoon Gary and Rhea.

Well, glad to see additional orders on the FOX system, but before I delve into that, I wanted to talk a little bit about the MAX orders from TI.

What gives you confidence that that business should jump back up to a more normal level in the next few quarters?

Yes, we said probably in the latter half of -- calendar 2007.

Basically it's just historical.

If you looked at over the last, whatever 10 years or 15 years that they've been our customer, they've typically bought systems every month and there was a few times, maybe 6 months to a year where they spells where they didn't.

So it's historical experience.

The good news, though, is that they're not, there's not a competitive situation.

So it's not like we're losing to a competitor.

So I think TI basically hasn't had a overall capital freeze, not just on Aehr Test, but for other, at least back end equipment that we know about.

So I think it's, maybe they're just trying to improve their financials for a few quarters.

Okay.

So and how much was the shortfall?

Was it 3 to 4 systems that you did not ship as opposed to the normal level?

Typically -- right we expect, yes about 3 or 4 systems.

Probably it was like 3 systems.

Typically that would be a minimum of what they'd order per quarter.

Okay.

So normally they would order 3 to 4 systems and instead you received --

We didn't receive any.

You did not receive any.

Okay.

Got it.

Okay, now shifting on to the FOX.

In terms of these two machines that you shipped in the quarter, when do you expect to realize revenue for this? and I know that, you know, well acceptance can be time consuming, but --

Gary can answer this one.

Sure.

On the two FOX systems that have been shipped, we've already recorded revenue on both of those.

Okay.

As of the end of the second quarter.

Okay.

And these were both 200 millimeter systems.

In terms of the additional systems, the orders that you received for these, when do you anticipate shipping -- shipping all those systems?

We said over the next 6 months.

So it would be our fourth quarter and first quarter of fiscal 2008 for us.

Would the recognition of revenue also be pushed out by a quarter or so?

I'll respond to that one.

Normally the recognition of revenue, if we're shipping products that have already been accepted by the same customer, then there are no delays.

Okay.

Okay.

All right.

On the FOX 14 system, is that -- so you receive the order and when do you -- so that will be delivered in the next, well potentially in the next three quarters, as well --

We receive the FOX 14 order last March.

Right.

We said at that time, you know, it would be about a 1-year ARO, so our expectations would be to ship it probably in the fourth quarter.

And whether we can get revenue recognition or not because it's a new customer that, you know, it might be a first quarter of -- fiscal 2008.

Okay.

Okay.

Great.

In terms of your R&D expense going forward, can you provide some kind of, some kind of guidance about that?

What we've said on the, on the R&D expense is as revenue increases, we would expect the R&D expenses to increase at a slower rate.

So yes, you would see increases, but we wouldn't expect the increases to be larger than whatever we saw as far as revenue increases.

Okay.

And that's obviously not a particular quarter, but that's a longer-term trend when we look at R&D expenses over the next two years that's what we're anticipating.

Okay.

And as the FOX both the FOX 1 and FOX 14 become a more meaningful part of your revenues, do you anticipate your gross margin structure to be changing?

What we have said previously, Ramesh, is that the FOX systems have a slightly better margin than our core product, maybe, a few percentage points.

So if the mix changes heavily over to FOX, we would anticipate that would result in a small increase in gross margin.

Also if revenues increase, then we would anticipate that there would be some improvement in gross margins, as well.

Okay.

All right, gentlemen, thank you very much.

Thanks very much.

Dennis Wassung with Canaccord Adams, please go ahead.

Hi, Dennis.

Hey, guys, how are you doing?

Good, thanks.

Happy New Year.

Happy New Year to you.

Thanks.

A few questions for you.

Sure.

I guess first off, on, let's see on the new the $6 million orders you talked about here for the FOX 1, this is a 300 millimeter application, and you guys seemed pretty excited about that after having the first two systems go to 200 millimeter.

How much new development do you have to do to satisfy the 300 millimeter requirement at this point?

Or is that pretty much all done and it's pretty much packaging?

Well, that's an excellent question, Dennis.

The original FOX 1 system that we developed was for 300 millimeter application.

And we depopulated the test head, for the 200 millimeter application primarily to save our customer money.

So as far as the system goes, we don't believe there is any development required.

Just a matter of populating the test head with, electronics to exercise all the dye.

The one development area that we do need to work on would be the 4-way for contactor where we have to develop a 300 millimeter full-way for contactor verses the 200 millimeter version that we've shipped already.

So the system hardware itself is already set up for 300 millimeter essentially but on the wafer contactor side, there's more work to be done there?

Correct.

We've never tested on the 300 millimeter wafer, but it shouldn't be, the system doesn't know the difference on whether you have a 200 or 300 millimeter wafer.

It's a matter of adding more pin drivers and things of that sort.

But excellent question.

I'm just curious as to what are the challenges there from your perspective going from 200 to 300, obviously there's a lot more force and loading that has to happen.

Is it just sort of blocking and tackling on that side?

There's nothing, I'm assuming there's nothing too revolutionary that has to happen to go from the 200 to 300.

It's mostly scaling up our signal distribution board and our wafer pack probe so it's, we feel the technology is scalable and, we think it's a lower risk situation.

But there's always some risk involved.

But, you know, we feel confident and our customer does that we can implement and make it happen.

Okay.

And I guess sort of related question here from, at least from this order, you mentioned it's a follow on order from the same customer.

This is the same customer that you shipped those two first systems to, is that accurate?

That's correct.

So all three of these -- at least all of these orders at this point are for flash applications?

That's correct.

Okay.

Perfect.

On the manufacturing capacity side of the question and design capacity side of the equation, I guess first on design, you talked about hiring some people more on the contactor's side and it sounded like that might be, I don't know if that's FOX 14 related or across the board, but how, what do you need to do on that side?

How many people do you need to hire?

Have you already made some progress there?

It sounds like you've hired somebody.

What are the requirements for you at this point to ramp up that activity.

Are you guys all, I guess, staffed for what you need to do at this point?

Yes, those are good questions.

On the system side, you know what we have to do is what I talked about a little bit is we have to start our supply chains.

Because our strategy is to do as much manufacturing outside as possible where we do final system assembly ask test.

It's a matter of getting our supply chain and the parts ordered and that rolling.

So I think from a manufacturing capacity of the system, we have sufficient space and people resources, maybe a few ads and techs and so forth.

On the full-way for contactors, there is a little greater challenge there because a lot of designs are custom designs than what we thought.

Good news is there's more different per system and the bad news is that we need more engineers that look at the applications and create the designs for the signal distribution boards.

Now a lot of the design and the manufacturing of our full-way for procard is done outside by subcontractors.

So we basically need to provide the engineering inputs to the outside suppliers and also to do the testing.

And we've hired, three or four good people to help us on that ramp-up.

And have we'll probably need, additional people over the over the coming years as volumes increase.

Okay, that's helpful.

On to sort of the demand side of the equation, you mentioned that your goal is to add at least one new customer for each of the products.

I'm assuming one new FOX 14?

Is that accurate?

That's correct.

Okay.

Are you currently working with anybody?

I'm assuming you have people in mind.

I'm just curious how far along you are with other potential customers that kind of gives you the -- obviously there's goals, there's expectations, are you close with anybody? and are these the same types of applications or are these new applications for you?

We are, our sales force obviously is motivated to go out and get additional business.

And we have targeted a few key customers that we think would suit the FOX.

And we feel we're relatively close.

They're very positive about the product line, but as you know, you know, whether it could happen next quarter or two quarters later, a million dollar plus type of a budget, it's always difficult to get that kind of approval and predict when that cycle is going to happen.

That's when we kind of look out over the next year.

We are working with people and the applications would be different than flash.

Okay.

And I know I've asked this question in prior conference calls, but could you support bringing on more than a customer or two over the next quarter or two at this point?

Obviously you want to keep this in a controlled manner, as well.

I mean our ideal situation would be to ramp up with our existing customer first and then have the second or third customer phase in later on in the year or the following year.

But we know we'll have to build and ship some additional units for them to evaluate before they buy production quantities.

So our first target is to ship, to book a few orders where we can, kind of get some prototype systems or engineering systems out there for evaluation.

Okay.

Very good.

And last question, sort of on the MAX side of the equation.

I think you mentioned outside of TI that the business is fairly consistent with what you've seen, is that accurate? and --

That's correct.

So specific applications you mentioned automotive --

It was mostly for automotive-- logic last quarter.

Okay.

It was automotive IC --

Are you seeing outside of TI, obviously they've had some changes in spending and we've seen that in other tester vendors, as well.

That's good.

That's what I said so I'm glad you're supporting that.

I guess are you seeing any other industry dynamics or changes?

It sounds like outside of TI things are pretty consistent for you.

I'm wondering if that's because of the automotive applications you're shipping into.

Are you seeing any other industry dynamics that are changing your business at all?

Actually we don't, we haven't, except for TI we haven't seen any, we're not covering all the counts, but we haven't seen any slow downs.

And certainly we see strong demand coming out of or Asia for memory in the next year.

So it's something that it's a challenge for us to go after, but as far as just giving you information on what we see in the marketplace, we do see the the DRAM market seemingly heat up for the back end space.

Okay.

All right.

Great.

Thanks, guys.

Thanks.

Thank you, Dennis.

Thank you.

Jim Gentrup with Metal Brick Capital Management.

Please go ahead with your question.

Good afternoon.

Hi, Jim.

Can you hear me?

Yes, how are you?

I would like to get a little more information on the percentage of sales in Q2, that represented by FOX.

The two shipments, the two systems that you shipped, what percent did they make up of your revenue?

They were greater than a third of our revenue, Jim.

Greater than a third, okay.

So then you still have a -- and they were part of that $4 million order that you announced in September I imagine?

Yes.

Okay, so you still have some of that to work off because you -- is this the first quarter that you actually shipped some of that $4 million or did some of that ship in Q1, as well?

It's the first system that we've shipped this quarter, yes. and then, so we can expect more of that shipment to go out then in Q3, more of that to be recognized, I guess?

More of that order.

We would expect so.

But the new order, I think if I heard correctly, the new order for 6 million really doesn't start impacting until Q4 and also Q1 of next year, if I heard correctly is that safe to say?

Yes.

Excuse me?

That's correct.

Okay.

All right.

And just since I'm new to the story, what does this do when you said that now you're going to be shipping 3 to 4 contactors, I guess custom contactors per system, how does that impact your potential sales from per system?

How does that -- how much is that going to increase?

Could you help us with a little bit with the math there?

I think -- yes, I was going to say that the, obviously the number of contactors would depend on the installed base of FOX.

So over time as we ship more and more, you will see the number of contactors increase and if you're -- maybe they're a quarter of a million dollars each, so 4 could be another million dollars.

So you could see the value of the contactors equal or exceed the value of the FOX systems over the long-term.

And these wear out, do these need to be replaced once a year, I think you said?

That's correct.

They don't ware out, but they make wafer changes.

They redesign the wafer for shrinks, for performance or whatever so they need new contactors.

So the wafer might last six months or it might last two years depending on the demand for that device.

But, you know, we estimate about a one-year life for the contactors.

Fair enough.

And then one more question.

I didn't hear you talk much about the MTX system, this conference call.

Is that not contributing as much?

Can you give me a little bit of detail there?

Yes, we -- right now we didn't see any MTX business for the last quarter.

It kind of sold into high volume memory applications and where as we'd sell to many customers who would buy 1 to 2 at that time.

MTX, we've typically sold it into DRAM or flash manufacturers and they would buy 5 to10 systems at a time and not buy it for another two or three quarters.

So it kind of comes and goes in spurts.

But right now we haven't seen any, we're not seeing much in activity in that area.

Was it last quarter you didn't have much activity there either?

Was it last quarter?

That's correct.

So maybe the second half of the year we might get one of those --

That's correct.

But you don't have that in your guidance?

No, right now we don't.

All right.

Thank you very much.

Thanks.

All right.

Thank you.

Jeffrey Scott with Scott Asset Management.

Please go ahead with your question.

Good afternoon.

Hi, Jeff.

How are you?

Well, thank you.

Couple of questions.

For the FOX 1 and the FOX 14, we still only have one customer you've shipped to for each of those products, correct?

On the FOX 1 we have one customer that we ship to, on the FOX 14, we do have two customers.

So early on, a few years ago we announced a customer --

That was for the --

[inaudible]

Yes.

So the automotive manufacturer is the second FOX 1 customer.

Okay.

Gary can you help us out on the 6.2 million revenue.

Can you break that down?

You said FOX was greater than 33%.

MAX and MTX was how much?

We don't normally give real close detail on the numbers, but if you combine MAX and MTX, it's around half.

Is something like 15%?

It's -- all the things, there's DiePak, there's other things, service, yes other things fall into those categories, but those are roughly the groupings.

Okay.

It sounds as though the contactor business could become a much more significant part of that recurring service/spares business going forward.

Absolutely.

Absolutely.

That's absolutely --

We shouldn't, if we go out a couple of years instead of talking about 3 or 4 systems, we could be talking about a service spares and additional contact business that's multimillion dollars per quarter, correct?

That's correct.

We, yes --

That kind of changes our thinking on, what your income statement is going to look like a couple years out.

Right, and the other advantage of that is it's not capital equipment dependent.

It's a consumable product.

In other words.

Indeed, once they had the capital equipment it behooves them to spend money for a new contactor to keep that machine operating at its capacity, correct?

Correct.

In terms of margins, can you get the same kind of gross margin on a new contactor design as you get on a system?

What we are guiding to initially is similar kinds of margins on the contactors and the systems, obviously we need to get a little bit of the production under our belt before we can say exactly how the things will play out.

And we believe both of those systems and the contactors should have a few points more gross margin than our core products.

Okay.

The $6 million order you announced today, how many machines is that for?

It's multiple machines.

And we rather not announce that because its, we don't want our customers doesn't want us to mention what the price is for those systems.

Okay.

Of the two FOX 1s that have been delivered, you said one was for engineering and one was in a 200 millimeter production flash, correct?

Correct.

How long has it actually been in production?

We just shipped it.

We shipped it last quarter.

Okay.

Is it up and running now?

It's being installed.

One is -- the engineering unit has been installed.

Right.

And has tested wafers.

The one in production is in the process of being installed.

Okay.

So you don't have any actual feedback as to how it is doing in a production facility right now?

That's correct.

Okay.

But that same customer has gone ahead and ordered 300 millimeter --

Right.

Designs of the same machine.

Yes.

They believe in the technology and they believe in the cost saving advantages of doing full way for test as opposed to stepping across a wafer 5 to 10 steps.

So we can save them a significant amount of money.

So they're -- they know they need the capacity.

And they're going ahead and ordering systems because they, they need the capacity.

Okay.

Do you have any kind of gut feeling on why the MAX and MTX order book has been quite soft?

I think on the Max, we alluded to TI.

I think TI is typically -- if you look at our top customers over the last -- it's been TI.

Yes.

And typically they've ordered a anywhere from 2 to 10 systems a quarter.

So I think that's the shortfall.

And with the MTX, I said it kind of comes and goes.

And right now we're just seeing a, we've seen a few months or a few quarters of kind of a dry spell, which isn't unusual.

In the last call, I had asked a question about gross margin and Gary really said that it was a mix issue and it was within distance of kind of what the target had been, so not to worry about it.

In the, in the 10Q filing, you actually specifically alluded to a sale to a new Asian customer at a kind of a new introductory price, which would be corrected in the future.

What product went to that new Asian customer?

It was a Max.

It was --

It was a Max for automotive applications.

And have you actually seen repeat orders from that customer?

Yes, yes we've seen repeat orders, multiple repeat orders.

So that's a positive account and we were able to increase the price.

Yes.

Is that, is that the kind of customer that's likely to be one of your top 5 in the future?

It's possible, yes.

If they live up to their forecasted amounts that they told us, sometimes that doesn't happen, but it's a good customer and it's automotive.

And it looks like they plan on possibly next year expanding in the China, so we'll see.

But it's an Asian customer and as you know it's difficult sometimes to penetrate into that account.

And we were able to do it with a low-cost configuration.

And also the intent is later on they will add the additional enhancements that the system allows them to add.

So we can recapture some of that margin later on.

But just the fact that they've already reordered say they like what they saw.

No, they liked it.

It's much better than what they had.

We had to prove it to them first.

You always do, right?

So we kind of had to be a little aggressive initially to dislodge their local customer with our product.

Okay.

Can you make some sort of comments about the level of order inquiry these days?

Are you happy with kind of the state of things?

Right.

If I know you're hyping on the FOX side.

If I look at overall we're happy because of the FOX and what we see there in terms of, we've announced 10 million over $10 million in bookings for the FOX 1.

And we still see continued activity on the FOX.

So I think overall, we're happy and pleased.

Ideally we'd like to be to have the MAXs being the same levels as the FOXs, but we know, we're okay and concerning the rest of the industry that we see is kind of sitting there with lower bookings in the last few quarters, we feel we're in a positive position going into 2007.

Okay.

I'll let somebody else get in, thank you very much.

Thanks.

Thank you. [OPERATOR INSTRUCTIONS] There do not appear to be any further questions.

Please continue with closing comments.

Well, this is -- I'd like to thank you again for -- [inaudible] and we look forward to speaking with you again next quarter.

Thanks again, and Happy New Year to everyone.

Bye now.

Ladies and gentlemen, this does conclude the Aehr Test Systems Second Quarter 2007 Conference Call.

At this time, you may now disconnect.

Have a very pleasant day.