AXT Posts Positive Q2
AXT, a manufacturer of compound semiconductor substrates, has reported financial results for the second quarter, ended June 30, 2018.
Revenue in Q2 2018 was $27.1 million, compared with $24.4 million in Q1 2018 and $23.6 million in Q2 2017. Gross margin was 40.6 percent of revenue in Q2 2018, compared with 39.2 percent of revenue in Q1 2018 and 30.8 percent in Q2 2017. Operating expenses were $6.5 million in Q2 2018, compared with $5.6 million in Q1 2018 and $5.0 million in Q2 2017.Operating profit in Q2 2018 was $4.5 million, compared with operating profit of $3.9 million in Q1 2018 and $2.3 million in Q2 2017.
"Our financial results for Q2 reflect solid demand in each of our primary product categories," said Morris Young, CEO. "Broadly, the demand environment for our wafers remains strong, and we continue to focus on producing high-quality products that meet rigorous application requirements, as well as achieving greater efficiency in our manufacturing process. We have also seen an uptick in the price of raw materials, and this has enabled a financial improvement in some of the raw material companies in which we have partial ownership. We are making good progress in the relocation of our GaAs manufacturing line and are encouraged by our success to date."
Interest and other, net was a gain of $0.4 million in Q2 2018, compared with a loss of $0.4 million in Q1 2018, and a loss of $0.2 million in Q2 2017. Interest and other, net for Q2 2018 included interest income and other of $0.2 million, a foreign exchange loss of $0.1 million and a net gain of $0.3 million from the seven partially owned companies in the company's supply chain, accounted for under the equity method.
Income tax expense in Q2 2018 was $0.4 million, compared with $0.3 million in Q1 2018 and $0.3 million in Q2 2017.
Net income in Q2 2018 was $3.9 million, or $0.10 per diluted share, compared with a net income of $2.9 million or $0.07 per diluted share in Q1 2018, and $1.9 million or $0.05 per diluted share in Q2 2017.