AXT, Inc. Announces Second Quarter 2026 Financial Results
FREMONT, Calif.--( BUSINESS WIRE)--AXT, Inc. (NasdaqGS: AXTI), a leading manufacturer of compound semiconductor wafer substrates, today reported financial results for the second quarter, ended June 30, 2026.
Management Qualitative Comments
“This is an incredibly exciting time for AXT,” said Morris Young, chief executive officer. “We have reached an inflection point in our business where strong customer demand for data center optical connectivity coupled with our continued success in adding manufacturing capacity and improving productivity are driving a step-function increase in our revenue. In Q2, we recorded our highest quarterly indium phosphide revenue to date. We are working closely with our direct customers as well as major end customers to understand their expected demand and roadmaps. We believe AXT is entering one of the most consequential chapters in our company’s history. The investments we are making today—in capacity, in technology, and in our uniquely integrated supply chain—position us to meet the extraordinary demand we see building across the optical and AI infrastructure markets.”
Second Quarter 2026 Results
Conference Call
The company will host a conference call to discuss these results today at 1:30 p.m. PT. The conference call can be accessed at (833) 461-5787 (passcode 630205921). The call will also be simulcast at www.axt.com. The webcast will be available at http://www.axt.com until July 30, 2027. Additional investor information can be accessed at http://www.axt.com.
About AXT, Inc.
AXT is a material science company that develops and manufactures high-performance compound and single element semiconductor substrate wafers comprising indium phosphide (InP), gallium arsenide (GaAs) and germanium (Ge). The company’s substrate wafers are used when a typical silicon substrate wafer cannot meet the performance requirements of a semiconductor or optoelectronic device. End markets include 5G infrastructure, data center connectivity (silicon photonics), passive optical networks, LED lighting, lasers, sensors, power amplifiers for wireless devices and satellite solar cells. AXT’s worldwide headquarters are in Fremont, California where the company maintains sales, administration and customer service functions. AXT has its Asia headquarters in Beijing, China and manufacturing facilities in three separate locations in China. In addition, as part of its supply chain strategy, the company has partial ownership in ten companies in China producing raw materials for its manufacturing process. For more information, see AXT’s website at https://investors.axt.com.
Safe Harbor Statement
This press release contains certain statements that constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. For example, our plans and ability to increase manufacturing capacity and to enable our industry to meet future demands and needs for our indium phosphide wafer substrates. Statements relating to our expectations regarding the receipt of export permits for our indium phosphide substrates, results of operations, market and customer demand for our products, our ability to expand our markets or increase sales, emerging applications using chips or devices fabricated on our substrates, including the use of indium phosphide wafer substrates in artificial intelligence (“AI”) applications, product yields and gross margins, expense levels, our investments in capital projects, ramping production at our sites, our ability to utilize or increase our manufacturing capacity, and our belief that we have adequate cash and investments to meet our needs are also forward-looking statements. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “could,” “would,” “project,” “plan,” “potentially,” “likely,” and similar expressions and variations thereof are intended to identify forward-looking statements, but are not the exclusive means of identifying such statements. These statements appear in this press release and elsewhere, include statements regarding the intent, belief or current expectations of our management that are subject to known and unknown risks, uncertainties and assumptions which could cause actual results to differ materially from those expressed or implied in the forward-looking statement. These risks, uncertainties and assumptions include, but are not limited to, the receipt of export permits for our indium phosphide substrates, the withdrawal, cancellations or requests for redemptions by private equity funds in China of their investments in Tongmei, the administrative challenges in satisfying the requirements of various government agencies in China in connection with the investments in Tongmei, geopolitical tensions between China and the United States, and other factors described and captioned “Risk Factors” in the company’s Annual Report on Form 10-K, quarterly reports on Form 10-Q and other filings made with the Securities and Exchange Commission. Each of these factors is difficult to predict and many are beyond the company’s control. The company does not undertake any obligation to update any forward-looking statement, as a result of new information, future events or otherwise. You are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors.
AXT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands, except per share data)
Three Months Ended
Six Months Ended
June 30,
June 30,
2026
2025
2026
2025
Revenue
$
47,589
$
17,974
$
74,513
$
37,330
Cost of revenue
26,223
16,541
45,169
37,138
Gross profit
21,366
1,433
29,344
192
Operating expenses:
Selling, general and administrative
7,292
5,653
13,843
11,569
Research and development
3,651
2,525
6,663
5,643
Total operating expenses
10,943
8,178
20,506
17,212
Income (loss) from operations
10,423
(6,745
)
8,838
(17,020
)
Interest income (expense), net
4,728
(202
)
4,829
(471
)
Equity in income (loss) of unconsolidated joint ventures
417
(171
)
770
77
Other income (expense), net
(436
)
23
(360
)
377
Income (loss) before provision for income taxes
15,132
(7,095
)
14,077
(17,037
)
Provision for income taxes
2,102
579
2,532
653
Net income (loss)
13,030
(7,674
)
11,545
(17,690
)
Less: Net (income) loss attributable to noncontrolling interests and redeemable noncontrolling interests
(1,902
)
666
(2,037
)
1,884
Net income (loss) attributable to AXT, Inc.
$
11,128
$
(7,008
)
$
9,508
$
(15,806
)
Net income (loss) attributable to AXT, Inc. per common share:
Basic
$
0.18
$
(0.16
)
$
0.16
$
(0.36
)
Diluted
$
0.17
$
(0.16
)
$
0.16
$
(0.36
)
Weighted-average number of common shares outstanding:
Basic
61,227
43,710
57,274
43,630
Diluted
63,474
43,710
59,642
43,630
AXT, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands)
June 30,
December 31,
2026
2025
ASSETS
Current assets:
Cash and cash equivalents
$
412,167
$
120,266
Restricted cash
33,050
8,100
Short-term investments
5,031
—
Accounts receivable, net
36,675
26,849
Inventories
96,322
81,651
Prepaid expenses and other current assets
15,558
9,690
Total current assets
598,803
246,556
Long-term investments
298,600
—
Property, plant and equipment, net
174,924
161,860
Operating lease right-of-use assets
1,766
1,982
Other assets
23,099
23,353
Total assets
$
1,097,192
$
433,751
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$
14,373
$
12,947
Accrued liabilities
27,052
14,798
Short-term loans
84,233
62,796
Total current liabilities
125,658
90,541
Noncurrent operating lease liabilities
1,164
1,441
Other long-term liabilities
18,522
7,138
Total liabilities
145,344
99,120
Redeemable noncontrolling interests
39,735
38,056
Stockholders’ equity:
Preferred stock
3,532
3,532
Common stock
66
55
Additional paid-in capital
943,758
339,922
Accumulated deficit
(55,416
)
(64,924
)
Accumulated other comprehensive loss
(4,666
)
(5,295
)
Total AXT, Inc. stockholders’ equity
887,274
273,290
Noncontrolling interests
24,839
23,285
Total stockholders’ equity
912,113
296,575
Total liabilities, redeemable noncontrolling interests and stockholders’ equity
$
1,097,192
$
433,751
AXT, INC.
Reconciliation of Statements of Operations Under GAAP and Non-GAAP
(Unaudited, in thousands)
Three Months Ended
Six Months Ended
June 30,
June 30,
2026
2025
2026
2025
GAAP gross profit
$
21,366
$
1,433
$
29,344
$
192
Stock-based compensation expense
65
47
130
110
Non-GAAP gross profit
$
21,431
$
1,480
$
29,474
$
302
GAAP operating expenses
$
10,943
$
8,178
$
20,506
$
17,212
Stock-based compensation expense
697
586
1,667
1,169
Non-GAAP operating expenses
$
10,246
$
7,592
$
18,839
$
16,043
GAAP income (loss) from operations
$
10,423
$
(6,745
)
$
8,838
$
(17,020
)
Stock-based compensation expense
762
633
1,797
1,279
Non-GAAP income (loss) from operations
$
11,185
$
(6,112
)
$
10,635
$
(15,741
)
GAAP net income (loss)
$
11,128
$
(7,008
)
$
9,508
$
(15,806
)
Stock-based compensation expense
762
633
1,797
1,279
Non-GAAP net income (loss)
$
11,890
$
(6,375
)
$
11,305
$
(14,527
)
GAAP net income (loss) per diluted share
$
0.17
$
(0.16
)
$
0.16
$
(0.36
)
Stock-based compensation expense per diluted share
$
0.01
$
0.01
$
0.03
$
0.03
Non-GAAP net income (loss) per diluted share
$
0.19
$
(0.15
)
$
0.19
$
(0.33
)
Shares used to compute diluted net income per share
63,474
43,710
59,642
43,630