Summary:
AXT, Inc. (NasdaqGS: AXTI), a prominent manufacturer of compound semiconductor substrates, announced its first-quarter financial results for 2025, reporting revenue of $19.4 million, down from $25.1 million in the previous quarter and $22.7 million year-over-year. The company experienced a significant dip in gross margin, landing at -6.4%, attributed to a 58% drop in indium phosphide sales amid trade restrictions, yield issues with gallium arsenide wafers, and lower substrate sales. CEO Morris Young acknowledged the geopolitical challenges but emphasized the growth potential at their China subsidiary, Tongmei, particularly in data center connectivity and autonomous driving technologies. Despite recent setbacks, Young expects a measured approach to market expansion will yield improvements through the rest of 2025.
