Fremont, California, May 2, 2026, 09:02 PDT
Shares of AXT, Inc. surged Friday, lifted by first-quarter numbers that showed stronger revenue and a smaller loss thanks to increased demand for indium phosphide wafers tied to AI data-center growth. The stock finished May 1 at $96.00, up 21.18%, with after-hours trading pushing it even higher, according to StockAnalysis data.
What’s at stake here: AXT finds itself drawn deeper into the AI supply chain, now in higher demand. The company’s indium phosphide, or InP—key for speedy data movement in optical links once silicon hits its limits—figures in data-center networks, silicon photonics, and 5G, AXT says.
AXT, headquartered in Fremont, California, is looking to boost its supply capabilities. The company disclosed that underwriters picked up an over-allotment of 1.28 million shares—each priced at $64.25—bringing in roughly $82.5 million in gross proceeds. Most of that is earmarked for expanding Beijing Tongmei’s InP production, plus R&D and working capital.
AXT reported revenue climbed to $26.9 million in the quarter ended March 31, up from $19.4 million a year ago. The company booked a GAAP net loss of $1.6 million, or 3 cents per share, narrowing from a loss of $8.8 million, or 20 cents a share, in the prior-year period. On a non-GAAP basis—which strips out items like stock-based compensation—the loss shrank to $585,000, or 1 cent per share.
AXT chief executive Morris Young called capacity “a critical enabler” in the company’s statement, assuring customers and supply-chain partners that “AXT is stepping up.” He drew a direct line between the new capital raise and Tongmei’s push to expand InP production, highlighting ongoing work on the 6-inch InP wafers a group of customers have been requesting. AXT Investors
Executives offered a more detailed look at the order book during the earnings call. CEO Young pointed out the InP backlog has climbed past $100 million, and anticipated the second quarter could set a new record for AXT’s InP business. CFO Gary Fischer added that roughly $34 million in Q2 revenue should come from orders already cleared with export permits—or those not requiring them.
But the outlook is murky. Fischer pointed out that the main driver for growth in Q2 and after is how export permits play out. The catch: approval timing remains “not predictable, nor in our control,” he said. If permits are delayed, AXT could be left holding orders and inventory that won’t convert into sales anytime soon. MarketBeat
Competition is fierce here. AXT’s most recent annual filing names Sumitomo Electric Industries, Freiberger Compound Materials, and Vital Materials as its main rivals in compound and single-element semiconductor substrates. Customers usually line up at least two approved substrate suppliers, AXT says, and in this space, share shifts quickly if there’s a gap in lead times or quality consistency.
Opinions remain divided on Wall Street over just how much of the rally is already baked in. According to StockAnalysis, two analysts rate AXT as a “Hold” with an average target price of $57. Over at Wedbush, Matt Bryson stuck to his Buy call and bumped his price target up to $93 from $80 on May 1. StockAnalysis
Right now, the focus is on whether AXT can actually turn the AI-driven demand into real shipments—without getting tangled up in permits, factory expansions, or squeezed prices. Investors, at least for the moment, are looking at the company less as a behind-the-scenes materials supplier and more as a key pinch point in the optical AI infrastructure supply chain.
