Axt Inc (NASDAQ: AXTI)

AXT, Inc. is a worldwide materials science company that develops and produces high performance compound and single element semiconductor substrates, also known as wafers. The company’s products serve applications where conventional silicon substrates cannot meet performance requirements, such as in high speed data transfer, optoelectronics, and specialized solar cells.

AXT generates revenue primarily from the sale of its substrate wafers and related raw materials. In 2025, substrate products accounted for approximately 67% of consolidated revenue while raw materials contributed the remaining 33%; comparable splits were 68%/32% in 2024 and 63%/37% in 2023. The wafers are sold to manufacturers that apply epitaxial layers, and the raw materials are sold both for internal use and to third party customers.

The company operates through the following segments.

• Substrate product group: This segment designs, manufactures and sells semiconductor wafers made from indium phosphide (InP), gallium arsenide (GaAs) and germanium (Ge). These wafers enable high speed optical communication, 5G infrastructure, fiber optics, light emitting diodes, laser devices and solar cell applications.

• Raw materials product group: This segment produces and sells critical inputs for wafer fabrication, including pyrolytic boron nitride crucibles, purified gallium, indium phosphide base material, arsenic, gallium magnesium alloy and boron oxide. These materials are used internally and also marketed to other companies for their own semiconductor and optoelectronic processes.

Within the specialty semiconductor substrate market, AXT competes with established firms such as Sumitomo Electric Industries, Japan Energy (JX), Freiberger Compound Materials, Umicore, China Crystal Technology Corp., and Vital Materials. The company differentiates itself through its claim of best in class indium phosphide wafers with low defect densities, its capability to produce low etch pit density gallium arsenide wafers up to eight inches, and its vertically integrated supply chain that provides control over key raw materials. AXT also highlights its access to both U. S. and Chinese capital markets and its low cost manufacturing base in China as competitive advantages.

AXT serves semiconductor and optoelectronic device manufacturers that require epitaxial layer application, as well as research institutions and universities experimenting with III and V and germanium materials. Its customers are located primarily in Asia, Europe and the United States, with no single customer accounting for more than ten percent of revenue in recent years.