# Axt (AXTI.US)

Canonical: https://gigainvestors.com/s/AXTI

Analysis as of: 2026-10-16T07:26:43.984Z. Financial observations: FY1998–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: fail; earnings resilience is evidence only). Published buy qualification: no.

Share price: $57.91 per share; close as of 2026-10-15.

## Checklist

### understandable: fail

- 3 revenue declines in the last 10 years (informational)

- more than 2 net loss years

- negative average operating margin

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 3

- Years with a net loss: 4

- Operating margin variation: 7.89×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.13×

- FY2018: 0.12×

- FY2019: -0.00×

- FY2020: 0.04×

- FY2021: 0.09×

- FY2022: 0.09×

- FY2023: -0.28×

- FY2024: -0.15×

- FY2025: -0.25×

- LTM to Jun 2026: 0.03×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- Recent gross margin fell 19.4pp below the typical margin (limit 4pp)

- ROIC, median of available years: 3.5%

- ROIC, second-lowest year: -7.8%

- Typical minus recent gross margin: 19.4 pp

- Typical gross margin (annual median): 32.1%

- Recent gross margin (lower of latest and 3-year median): 12.7%

- Years with nonpositive capital: 0

- Capital spending / revenue: 20.5%

- ROIC including acquisitions, ten-year median: -2.8%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 6.5%

- FY2017: 9.8%

- FY2018: 7.3%

- FY2019: -0.2%

- FY2020: 2.1%

- FY2021: 6.5%

- FY2022: 5.0%

- FY2023: -7.8%

- FY2024: -5.3%

- FY2025: -8.0%

### economics: fail

- owner earnings cash conversion below threshold

- incremental invested capital return below threshold

- working capital as a share of revenue rose more than 10pp and ends positive

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: -$32M

- Net income, five-year total: -$20M

- Return on incremental invested capital: -8.1%

- Working capital / revenue, annual change: 6.5 pp

- Working capital / revenue, change between three-year averages: 51.3 pp

- Working capital / revenue, final three-year average: 111.3%

Chart: Owner earnings · five years; fiscal year observations.

- FY2021: $15M

- FY2022: -$468K

- FY2023: -$20M

- FY2024: -$8.4M

- FY2025: -$18M

### management: fail

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- potential debt-funded buybacks (informational)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: 7.3% vs -7.8%

- Per-share earnings: 0.17 to -0.42 (three-year endpoint medians)

- per-share value declined or ends nonpositive

- five-year and ten-year diluted share growth both above threshold

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 3.2%

- Ordinary dilution, 5-year annual growth: 1.4%

- Market cap gain: $746M

- Cumulative retained earnings: $61K

- Diluted shares, 10-year annual growth: 3.2%

- Diluted shares, 5-year annual growth: 1.4%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value change: -$0.59

- Per-share value, starting three-year median: $0.17

- Per-share value, ending three-year median: -$0.42

- Buybacks concentrated in cheaper years (correlation): 0.50

- Average buyback yield: 0.2%

- Buyback history: 3 years

- Debt-funded buybacks: Yes

- Acquisition spending: $2.2M

- Cumulative net income, 10 years: $6.7M

- ROIC, first three-year median: 7.3%

- ROIC, last three-year median: -7.8%

Chart: Earnings per share; fiscal year observations.

- FY2016: $0.17

- FY2017: $0.26

- FY2018: $0.24

- FY2019: -$0.04

- FY2020: $0.08

- FY2021: $0.34

- FY2022: $0.37

- FY2023: -$0.42

- FY2024: -$0.27

- FY2025: -$0.48

### accounting: pass

- Sloan accruals: -2.0%

- Receivables to sales index (DSRI): 1.18×

- Restructuring years, last five: 0

- Earnings backed by cash: Yes

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.01×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -4.5%

- FY2017: 0.7%

- FY2018: 2.9%

- FY2019: -6.4%

- FY2020: -0.9%

- FY2021: 5.4%

- FY2022: 6.6%

- FY2023: -5.9%

- FY2024: 0.1%

- FY2025: -2.0%

## Holders

- [Dan Davidowitz](https://gigainvestors.com/pcm): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Down 44% since May 2026 · sales +42.1%

Story as of 2026-10-16T09:58:21.501Z; price observation 2026-10-15.

- 2025-08-01: Earnings call transcript: AXT Inc. Q2 2025 reveals revenue miss, stock dips ([investing.com](https://www.investing.com/news/transcripts/earnings-call-transcript-axt-inc-q2-2025-reveals-revenue-miss-stock-dips-93CH-4164839))

- 2026-05-02: AXT Inc. (AXTI) Revenues Climb on AI Demand, Shares Hit Fresh High ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/axt-inc-axti-revenues-climb-040430174.html))

### Sales · FY2025–2026

sales +42.1%; source https://www.sec.gov/Archives/edgar/data/1051627/000143774926008612/axti20251231_10k.htm; observed 2026-03-17.

- FY2017: $99M 

- FY2018: $102M 

- FY2019: $83M 

- FY2020: $95M 

- FY2021: $137M 

- FY2022: $141M 

- FY2023: $76M 

- FY2024: $99M 

- FY2025: $88M 

- FY2026: $126M 

### Gross margin · FY2025

gross margin 12.7%; source https://www.sec.gov/Archives/edgar/data/1051627/000143774926008612/axti20251231_10k.htm; observed 2026-03-17.

- FY2016: 32.4% 

- FY2017: 34.9% 

- FY2018: 36.2% 

- FY2019: 29.8% 

- FY2020: 31.7% 

- FY2021: 34.5% 

- FY2022: 36.9% 

- FY2023: 17.6% 

- FY2024: 24.0% 

- FY2025: 12.7% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in semiconductor equipment & materials; annual sales are USD 88.3 million.

- Source: https://www.sec.gov/Archives/edgar/data/1051627/000143774926008612/axti20251231_10k.htm (filed 2026-03-17); FY2025: revenue 88326000; grossProfit 11242000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); AXTI.US: AXT, Inc. designs, develops, manufactures, and distributes compound and single element semiconductor substrates. The company provides indium phosphide for use in data center connectivity using light/lasers, high-speed data transfer in data centers, 5G communications, fiber optic lasers and detectors, consumer devices, passive optical networks, silicon photonics, photonic integrated circuits, thermo-photovoltaics, RF amplifier and switching, infrared light-emitting diode (LEDS) motion control, lidar for robotics and autonomous vehicles, and infrared thermal imaging. It also offers semi-insulating gallium arsenide (GaAs) substrates for use in Wi-Fi and IoT devices, transistors, direct broadcast television, power amplifiers, satellite communications, and solar cells; and semi-conducting GaAs substrates that are used in LEDs, screen displays using micro-LEDs, printer head lasers and LEDs, 3-D sensing using VCSELs, data center communication using VCSELs, sensors for industrial robotics/near-infrared sensors, laser machining, cutting and drilling, optical couplers, solar cells, night vision goggles, lidar for robotics and autonomous vehicles, and other lasers. In addition, the company provides germanium substrates for use in multi-junction solar cells for satellites, optical sensors and detectors, terrestrial concentrated photo voltaic cells, infrared detectors, and carrier wafer for LED. Further, it offers 6N+ and 7N+ purified gallium, boron trioxide, gallium-magnesium alloy, pyrolytic boron nitride (pBN) crucibles, and pBN insulating parts. It sells its products through direct salesforce in the United States, China, and Europe, as well as through independent sales representatives and distributors in Japan, Taiwan, Korea, and internationally. The company was formerly known as American Xtal Technology, Inc. and changed its name to AXT, Inc. in July 2000. AXT, Inc. was incorporated in 1986 and is headquartered in Fremont, California.

### Why customers stay

Margins ranged from 12.7% to 24% during 2023–25; it earns 3.5% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2023: grossProfit / revenue = 17.6%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2024: grossProfit / revenue = 24%.

- Source: https://www.sec.gov/Archives/edgar/data/1051627/000143774926008612/axti20251231_10k.htm (filed 2026-03-17); FY2025: grossProfit / revenue = 12.7%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); 10-year return on capital observations [[2016,0.06534263798697897],[2017,0.09755677527573879],[2018,0.07337942384379838],[2019,-0.0015472128836690015],[2020,0.02111524715791674],[2021,0.06507299093750923],[2022,0.049703718765076677],[2023,-0.07751327180009734],[2024,-0.05322542031914216],[2025,-0.0796962908556739]]; median 0.03540948296149671. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 5 of 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2016: growth capex 0; upkeep 2728000; owner earnings 7773000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2017: growth capex 7155475.360935021; upkeep 14200524.639064979; owner earnings 369475.3609350212. Growth capex / owner earnings = 19.36658331648112.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2021: growth capex 22567000; upkeep 7078000; owner earnings 14575000. Growth capex / owner earnings = 1.548336192109777.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); Dividend observations: [[2016,0],[2017,465000],[2018,415000],[2019,5552000],[2020,2238000],[2021,1077000],[2022,0],[2023,0],[2024,0],[2025,0]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 4% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); AXTI.US SharesStats.PercentInsiders = 3.977 percentage points; cache date 2026-10-16.

### What the price says

The price is 28.8 times annual sales; cash earnings are negative.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); Closing price 57.91 USD; reporting-to-trading FX 1; FY2025 annual sales per share 2.010470489153939; price multiple 28.80420295269796. FY2025 cash earnings/share -0.4130607971228917. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $5.15 per share

- 2016-11: $4.80 per share

- 2016-12: $4.80 per share

- 2017-01: $5.75 per share

- 2017-02: $7.10 per share

- 2017-03: $5.80 per share

- 2017-04: $6.75 per share

- 2017-05: $6.65 per share

- 2017-06: $6.35 per share

- 2017-07: $8.75 per share

- 2017-08: $7.80 per share

- 2017-09: $9.15 per share

- 2017-10: $9.30 per share

- 2017-11: $9.65 per share

- 2017-12: $8.70 per share

- 2018-01: $7.90 per share

- 2018-02: $7.48 per share

- 2018-03: $7.25 per share

- 2018-04: $5.85 per share

- 2018-05: $7.25 per share

- 2018-06: $7.05 per share

- 2018-07: $7.55 per share

- 2018-08: $7.90 per share

- 2018-09: $7.15 per share

- 2018-10: $6.59 per share

- 2018-11: $5.51 per share

- 2018-12: $4.35 per share

- 2019-01: $4.11 per share

- 2019-02: $4.46 per share

- 2019-03: $4.45 per share

- 2019-04: $5.70 per share

- 2019-05: $3.99 per share

- 2019-06: $3.96 per share

- 2019-07: $4.27 per share

- 2019-08: $3.39 per share

- 2019-09: $3.56 per share

- 2019-10: $3.12 per share

- 2019-11: $3.16 per share

- 2019-12: $4.35 per share

- 2020-01: $3.90 per share

- 2020-02: $3.48 per share

- 2020-03: $3.21 per share

- 2020-04: $5.53 per share

- 2020-05: $5.29 per share

- 2020-06: $4.76 per share

- 2020-07: $4.79 per share

- 2020-08: $5.64 per share

- 2020-09: $6.12 per share

- 2020-10: $5.95 per share

- 2020-11: $9.75 per share

- 2020-12: $9.57 per share

- 2021-01: $10.33 per share

- 2021-02: $12.93 per share

- 2021-03: $11.66 per share

- 2021-04: $9.86 per share

- 2021-05: $10.18 per share

- 2021-06: $10.98 per share

- 2021-07: $10.20 per share

- 2021-08: $9.31 per share

- 2021-09: $8.33 per share

- 2021-10: $8.17 per share

- 2021-11: $8.22 per share

- 2021-12: $8.81 per share

- 2022-01: $7.49 per share

- 2022-02: $7.45 per share

- 2022-03: $7.02 per share

- 2022-04: $5.90 per share

- 2022-05: $5.85 per share

- 2022-06: $5.86 per share

- 2022-07: $8.77 per share

- 2022-08: $8.59 per share

- 2022-09: $6.70 per share

- 2022-10: $4.54 per share

- 2022-11: $5.31 per share

- 2022-12: $4.38 per share

- 2023-01: $5.89 per share

- 2023-02: $4.37 per share

- 2023-03: $3.98 per share

- 2023-04: $2.67 per share

- 2023-05: $3.41 per share

- 2023-06: $3.44 per share

- 2023-07: $3.11 per share

- 2023-08: $2.60 per share

- 2023-09: $2.40 per share

- 2023-10: $1.99 per share

- 2023-11: $1.99 per share

- 2023-12: $2.40 per share

- 2024-01: $2.46 per share

- 2024-02: $4.29 per share

- 2024-03: $4.59 per share

- 2024-04: $3.00 per share

- 2024-05: $3.81 per share

- 2024-06: $3.38 per share

- 2024-07: $3.64 per share

- 2024-08: $2.65 per share

- 2024-09: $2.42 per share

- 2024-10: $2.58 per share

- 2024-11: $2.14 per share

- 2024-12: $2.17 per share

- 2025-01: $2.09 per share

- 2025-02: $1.60 per share

- 2025-03: $1.41 per share

- 2025-04: $1.40 per share

- 2025-05: $1.51 per share

- 2025-06: $2.09 per share

- 2025-07: $2.08 per share

- 2025-08: $2.90 per share

- 2025-09: $4.49 per share

- 2025-10: $7.95 per share

- 2025-11: $10.70 per share

- 2025-12: $16.35 per share

- 2026-01: $18.54 per share

- 2026-02: $37.90 per share

- 2026-03: $56.98 per share

- 2026-04: $79.22 per share

- 2026-05: $103.16 per share

- 2026-06: $72.08 per share

- 2026-07: $60.43 per share

- 2026-08: $60.61 per share

- 2026-09: $77.41 per share

- 2026-10: $57.91 per share

## Annual estimated value (USD per share)

- FY2017: low $1.71 per share, central $1.72 per share, high $1.74 per share

- FY2018: low $1.01 per share, central $1.03 per share, high $1.05 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/1051627/000143774926008612/axti20251231_10k.htm); period 2025-12-31, filed 2026-03-17.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.