Shares in Aehr Test Systems (AEHR -5.13%) rose another 15.9% in the week to Friday morning. The move marks another wave of optimism for its potential to diversify away from its core silicon carbide (SiC) wafer-level burn-in (WLBI) test solutions and into new markets such as the gallium nitride (GaN) WLBI market.

Why developing new markets matters

Not only would diversification help reduce dependence on the SiC WLBI market (where ON Semiconductor is traditionally a major customer for Aehr), it would also move Aehr Test Systems into a GaN market that appears to be building momentum.

The good news is Aehr disclosed that three of its four customers, each of which represented more than 10% of its revenue in the third quarter, were in artificial intelligence processors and in the GaN WLBI market on its recent earnings call.

The latter is pertinent considering that Navitas Semiconductor recently said it had been selected to collaborate with Nvidia to develop GaN and SiC chips for the next-generation data center architecture.

The news sent Navitas stock soaring, and this week Navitas also said it had a partnership in place to develop SiC chips with BrightLoop.

Image source: Getty Images.

Navitas and Aehr Test Systems

All of which raises the question whether Navitas is one of the customers Aehr's management mentioned recently. Confidentiality agreements preclude disclosure, but at a recent William Blair conference, the moderator referenced the Navitas/Nvidia collaboration when introducing Aehr CEO Gayn Erickson. Erickson didn't deny that Navitas is a customer.

That's way short of a strong conclusion that Navitas is a significant Aehr customer, and Sherlock Holmes would blush at the logic, but it's probably what's driving the stock higher this week.