AXT (NASDAQ:AXTI) Announces Earnings Results

AXT (NASDAQ:AXTI) announced its quarterly earnings results on Thursday. The semiconductor company reported $0.19 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.07 by $0.12, FiscalAI reports. AXT had a negative net margin of 14.69% and a negative return on equity of 5.71%. The firm had revenue of $47.59 million for the quarter, compared to analyst estimates of $34.08 million. AXT updated its Q3 2026 guidance to 0.300-0.320 EPS.

Here are the key takeaways from AXT’s conference call:

• Record Q2 results: Revenue reached $47.6 million, up 77% sequentially and 164% year over year, while non-GAAP net income was $11.9 million, or $0.19 per diluted share. Non-GAAP gross margin improved to 45.0% from 29.9% in Q1.
• Demand for indium phosphide substrates, driven primarily by AI data-center optical connectivity, is substantially exceeding supply. The company plans to lift quarterly indium phosphide capacity to approximately $60 million by year-end 2026 and potentially around $130 million by the end of 2027, with backlog above $100 million.
• AXT signed long-term supply agreements with Casela, Coherent, and Lumentum, including $47.7 million in wafer prepayments from Casela and Coherent. Management said these agreements support confidence in the capacity expansion and expect their revenue contribution to increase from Q3 onward.
• Management guided to approximately $66 million of Q3 revenue that is already supported by permits or does not require permits, with non-GAAP earnings of $0.30–$0.32 per share. Further upside is possible if additional export permits are secured, although permit timing remains uncertain.
• Tongmei shifted its planned listing from China’s STAR Market to the Hong Kong Exchange, a process expected to take about a year. The move creates a potential $49 million redemption right for private-equity investors, though management said investors currently want to remain invested and AXT has sufficient cash if redemption is requested.

AXT Price Performance

Shares of AXTI traded up $13.74 during trading hours on Friday, hitting $60.68. The stock had a trading volume of 25,823,267 shares, compared to its average volume of 10,172,729. The stock has a market capitalization of $3.97 billion, a price-to-earnings ratio of -194.47 and a beta of 1.86. The company’s fifty day moving average is $77.44 and its two-hundred day moving average is $61.74. AXT has a 52 week low of $1.85 and a 52 week high of $143.16.

Key AXT News

Here are the key news stories impacting AXT this week:

• Positive Sentiment: Q2 earnings beat expectations: AXT reported quarterly revenue of approximately $47.6 million, well above the roughly $34 million consensus estimate, while EPS of $0.19 exceeded expectations of $0.07. Results were supported by record indium phosphide demand, improved productivity and stronger profitability. AXTI Q2 Earnings Beat on Record InP Demand, Revenues Rise Y/Y
• Positive Sentiment: Very bullish Q3 outlook: Management guided for third-quarter EPS of $0.30–$0.32 and revenue of about $66 million, substantially above analyst estimates of approximately $0.10 EPS and $38.7 million in revenue. The outlook suggests momentum is continuing into the second half of the year.
• Positive Sentiment: AI infrastructure demand is driving expansion: AXT highlighted accelerating demand from data-center optical connectivity and plans to expand capacity, potentially supporting higher production volumes and margins. AXTI Q2 Earnings Call Highlights AI Capacity Expansion
• Positive Sentiment: Analyst upgrade and customer agreement: Needham upgraded AXTI from Hold to Buy and assigned a $90 price target. Separately, AXT entered a long-term indium phosphide supply and capacity-reservation agreement with Lumentum, improving demand visibility. Needham Upgrades AXT to Buy
• Neutral Sentiment: Options activity was elevated: Traders bought 43,167 call options, about 29% above average call volume, indicating increased speculative and potentially bullish interest but not guaranteeing further gains.
• Negative Sentiment: Insider selling remains a risk: Reported insider activity over the past six months showed sales by executives and directors, with no purchases. This may temper enthusiasm despite the earnings-driven rally.

Insider Activity at AXT

In other AXT news, Director David C. Chang sold 8,333 shares of the company’s stock in a transaction dated Monday, June 15th. The shares were sold at an average price of $111.17, for a total transaction of $926,379.61. Following the sale, the director directly owned 65,165 shares of the company’s stock, valued at approximately $7,244,393.05. This represents a 11.34% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. Also, CEO Morris S. Young sold 123,601 shares of the firm’s stock in a transaction that occurred on Tuesday, June 2nd. The stock was sold at an average price of $113.33, for a total transaction of $14,007,701.33. Following the sale, the chief executive officer directly owned 2,149,533 shares of the company’s stock, valued at approximately $243,606,574.89. The trade was a 5.44% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold 251,636 shares of company stock valued at $27,789,677 in the last ninety days. Insiders own 5.97% of the company’s stock.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently modified their holdings of AXTI. State of Wyoming acquired a new stake in AXT during the 4th quarter valued at $69,000. Kestra Advisory Services LLC acquired a new position in AXT in the fourth quarter worth $98,000. Osaic Holdings Inc. grew its holdings in shares of AXT by 1,071.5% during the fourth quarter. Osaic Holdings Inc. now owns 11,012 shares of the semiconductor company’s stock worth $180,000 after purchasing an additional 10,072 shares during the last quarter. Jefferies Financial Group Inc. bought a new stake in shares of AXT during the third quarter worth $52,000. Finally, SummitTX Capital L.P. acquired a new stake in shares of AXT in the fourth quarter valued at $228,000. 49.52% of the stock is owned by institutional investors and hedge funds.

Analysts Set New Price Targets

Several brokerages have recently weighed in on AXTI. Needham & Company LLC upgraded shares of AXT from a “hold” rating to a “buy” rating and set a $90.00 target price on the stock in a research report on Friday. Northland Securities set a $125.00 price target on shares of AXT in a research report on Wednesday, June 3rd. UBS Group set a $90.00 price target on shares of AXT in a research note on Friday. Weiss Ratings upgraded AXT from a “sell (e+)” rating to a “sell (d-)” rating in a research note on Wednesday, May 27th. Finally, B. Riley Financial dropped their target price on AXT from $73.00 to $52.00 and set a “neutral” rating for the company in a report on Tuesday. Three research analysts have rated the stock with a Buy rating, one has assigned a Hold rating and one has issued a Sell rating to the company. According to MarketBeat, AXT has a consensus rating of “Hold” and a consensus target price of $77.00.

AXT Company Profile

AXT, Inc (NASDAQ: AXTI) is a global supplier of compound and single-element semiconductor substrates, offering a range of materials critical for high-performance electronic and optoelectronic devices. Founded in 1986 and headquartered in Fremont, California, AXT specializes in the development, manufacture and distribution of wafers composed of gallium arsenide (GaAs), indium phosphide (InP), gallium nitride (GaN) and other compound semiconductor materials. These substrates serve as the foundational platforms for devices used in data communications, wireless infrastructure, advanced computing, consumer electronics and photovoltaic applications.

AXT’s product portfolio encompasses a variety of wafer sizes, dopant concentrations and crystal orientations, tailored to meet the precise specifications of its customers.