AEM - DBS Research 2024-05-10: Two Sides To A Chip ~ Key Customer Weakness, New Customer Growth

AEM - Two Sides To A Chip ~ Key Customer Weakness, New Customer Growth

AEM (SGX:AWX) | SGinvestors.ioAEM (SGX:AWX)
  • AEM (SGX:AWX)’s top line was impacted by
    1. slower-than-anticipated recovery at the key customer and
    2. softness in contract manufacturing given the inventory build-up in the life science and industrial sectors.
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  • We believe that the steep decline in test & automation equipment sales could be due to the low utilisation rates of test equipment that its key customer Intel had pulled in during FY22.

Revenue consistent with our projections but earnings was a miss.

  • AEM's 1Q24 revenue came in at S$94.2mil (-38.3% y-o-y), in line with our estimates, accounting for 23% of our revised FY24F estimates and 51% of 1H24 guidance of S$170-200mil.
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  • AEM also undertook a restructuring charge of S$2.1mil following a reorganisation exercise in 1Q24.

Our thoughts on AEM's performance

Semiconductor test market shows uneven recovery; uptick only from 2025 onwards

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Above is the excerpt from report by DBS Group Research.
Clients of DBS may access the full report in PDF @

Amanda TAN DBS Group Research | Lee Keng LING DBS Research | 2024-05-10

Previous report by DBS:
2024-03-01 AEM - Uncertainties Persist Into 2024.

Price targets by 3 other brokers at AEM Target Prices.

Listing of research reports at AEM Analyst Reports.

Relevant links:
AEM Share Price History,
AEM Announcements,
AEM Dividends & Corporate Actions,
AEM News Articles


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