AI boom: AEM quadruples Q1 profit to S$14.3 million, raises FY2026 revenue guidance by 20%

[SINGAPORE] Semiconductor test solutions provider AEM posted S$14.3 million in net profit for the first quarter ended Mar 31, more than quadrupling from S$3.3 million in the year-ago period.

The company also raised its FY2026 revenue guidance by 20 per cent to between S$550 million and S$600 million, it said in a business update after trading hours on Wednesday (May 13).

Its shares rose 10.7 per cent earlier in the day, closing at S$8.35.

Its Q1 revenue was up 35.8 per cent at S$116.9 million, driven by continued high-volume production deployments by a customer in the fabless artificial intelligence and high-performance computing (HPC) sector.

AEM also had “improving order activity” from a customer in the PC and foundry space.

“Increasing thermal and power complexity in next-generation AI compute devices continued to support demand for AEM’s high-parallel test and thermal management solutions,” said the company.

Its test cell solutions (TCS) segment revenue expanded 72 per cent to S$88.1 million. This offset a 15.7 per cent decline in revenue from the contract manufacturing division, which was hit by softer demand from the oil and gas sector.

“The group’s strategic priority for contract manufacturing is to support the semiconductor equipment ramp requirements of the TCS segment and improve profitability performance,” said AEM.

Its net profit margin for Q1 stood at 12.3 per cent, widened from 3.9 per cent the year before, due to a better product mix and other improvements.

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“Multi-year earnings upcycle”

AEM’s fabless AI and HPC customer is on track to become its largest customer in FY2026.

Meanwhile, its PC and foundry customer “is seeing a healthy recovery in demand, with order momentum improving into 2026”, AEM said.

Chief executive Samer Kabbani called Q1 “the start of a multi-year earnings upcycle for AEM, one grounded in structural industry change rather than cyclical recovery”.

He said the results demonstrate “the operating leverage inherent in our business model as volumes grow”.