FREMONT, CA — (Marketwired) — 10/30/14 — AXT, Inc. (NASDAQ: AXTI), a leading manufacturer of compound semiconductor substrates, today reported financial results for the third quarter ended Sept. 30, 2014.
Revenue for the third quarter of 2014 was $23.1 million compared with $21.4 million in the second quarter of 2014.
Gross margin was 23.0 percent of revenue for the third quarter of 2014, compared with 19.4 percent of revenue in the second quarter of 2014.
Operating expenses were $4.7 million in the third quarter of 2014, unchanged from $4.7 million in the second quarter of 2014.
Profit from operations for the third quarter of 2014 was $653,000 compared with a loss from operations of $515,000 in the second quarter of 2014.
Net interest and other income for the third quarter of 2014 was $260,000. This was primarily attributable to $390,000 from equity earnings of the company–s unconsolidated joint ventures, $302,000 from the sale of IntelliEpi stock, $556,000 from a loss on foreign exchange and $106,000 from interest income. By comparison, net interest and other income for the second quarter of 2014 was $1.2 million. This was primarily attributable to $625,000 from equity earnings of the company–s unconsolidated joint ventures, $324,000 from the sale of IntelliEpi stock, $158,000 from a gain on foreign exchange and $127,000 from interest income.
Net income in the third quarter of 2014 was $644,000 or $0.02 per diluted share compared with a net income of $319,000 or $0.01 per diluted share in the second quarter of 2014.
“The third quarter was a positive quarter for AXT,” said Morris Young, chief executive officer. “Revenue came in ahead of our expectations, and we achieved another quarter of profitability through improved gross margins and tight expense control. Further, we are diversifying our customer base throughout our product portfolio and are pleased to be gaining traction in several areas that have been a strong focus of our sales efforts. The changes in the gallium arsenide landscape over the past two years have had an adverse impact on our business. However, these changes are finally beginning to settle and new applications for our products are emerging across our substrate portfolio. I am very pleased to have a strong team in place with the expertise to maximize our potential as we evolve our business to meet new opportunities.”
The company will host a conference call to discuss these results on Oct. 30, 2014 at 1:30 p.m. PT. The conference call can be accessed at (719) 457-2645 (passcode 2872393). The call will also be simulcast on the Internet at . Replays will be available at (719) 457-0820 (passcode 2872393) until Nov. 6, 2014. Financial and statistical information to be discussed in the call will be available on the company–s website immediately prior to commencement of the call. Additional investor information can be accessed at or by calling the company–s Investor Relations Department at (510) 683-5900.
AXT designs, develops, manufactures and distributes high-performance compound and single element semiconductor substrates comprising gallium arsenide (GaAs), indium phosphide (InP) and germanium (Ge) through its manufacturing facilities in Beijing, China. In addition, AXT maintains its sales, administration and customer service functions at its headquarters in Fremont, California. The company–s substrate products are used primarily in lighting display applications, wireless communications, fiber optic communications and solar cell. Its vertical gradient freeze (VGF) technique for manufacturing semiconductor substrates provides significant benefits over other methods and enabled AXT to become a leading manufacturer of such substrates. AXT has manufacturing facilities in China and invests in joint ventures in China producing raw materials. For more information, see AXT–s website at .
The foregoing paragraphs contain forward-looking statements within the meaning of the Federal Securities laws, including statements regarding the market demand for our products, our market opportunity, our business planning and management approach and our expectations with respect to our business prospects. These forward-looking statements are based upon specific assumptions that are subject to uncertainties and factors relating to the company–s operations and business environment, which could cause actual results of the company to differ materially from those expressed or implied in the forward-looking statements contained in the foregoing discussion. These uncertainties and factors include but are not limited to: overall conditions in the markets in which the company competes; global financial conditions and uncertainties; market acceptance and demand for the company–s products; the impact of factory closures or other events causing delays by our customers on the timing of sales of our products; and other factors as set forth in the company–s annual report on Form 10-K 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.
Contacts:
Gary Fischer
Chief Financial Officer
(510) 683-5900
Leslie Green
Green Communications Consulting, LLC
(650) 312-9060
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