- AEM (SGX:AWX)’s 9M25 NPAT of S$4m was lower than ours and consensus estimates by 50-70%.
- AEM expects 2H25 revenue to reach the upper end of the S$170-190m guidance and remains bullish for FY26, with its major AI/High-Performance Computing (HPC) customer expected to grow significantly. However, valuations remain rich for AEM's share price trading at 24.2x FY26E P/E (vs sector average of 18x and 5-year mean of 15x) and we believe the main profitability surge is unlikely until 2H26E.
Expect AI/HPC revenue to double.
- - Read this at SGinvestors.io -
- - Read this at SGinvestors.io -
2H25 revenue guidance of S$170-190m.
- AEM expects 2H25 revenue to reach the upper end of its S$170–190m guidance, similar to 1H25, driven by robust demand from its major AI/HPC customer, which is set to ramp up production in late 2025 for its next-generation AI accelerator.
- A purchase order for an evaluation final-test handler from its memory customer also signals potential revenue recognition in late FY26, with volume production in FY27.
Maintain SELL, target price higher at 20x 26E P/E.
- Read more at SGinvestors.io.
