AXT, Inc. Announces Second Quarter 2026 Financial Results

FREMONT, Calif., July 30, 2026–(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

Revenue for the second quarter of 2026 was $47.6 million, compared with $26.9 million for the first quarter of 2026 and $18.0 million for the second quarter of 2025.
GAAP gross margin was 44.9 percent of revenue for the second quarter of 2026, compared with 29.6 percent of revenue for the first quarter of 2026 and 8.0 percent for the second quarter of 2025.
Non-GAAP gross margin, after excluding charges for stock-based compensation, was 45.0 percent of revenue for the second quarter of 2026, compared with 29.9 percent of revenue for the first quarter of 2026 and 8.2 percent for the second quarter of 2025.
GAAP net income, after minority interests, for the second quarter of 2026 was a net income of $11.1 million, or $0.17 diluted income per share, compared with a net loss of $1.6 million, or $0.03 per share, for the first quarter of 2026 and a net loss of $7.0 million, or $0.16 per share, for the second quarter of 2025.
Non-GAAP net income for the second quarter of 2026 was a net income of $11.9 million, or $0.19 per share, compared with a net loss of $0.6 million, or $0.01 per share, for the first quarter of 2026 and a net loss of $6.4 million, or $0.15 per share, for the second quarter of 2025.

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