AXT announces lower revenues in Q1
Inventory correction from late last summer impacts results
AXT, a manufacturer of compound semiconductor wafer substrates, has reported financial results for the first quarter, ended March 31, 2023.
“As expected, revenue took a step back in Q1 as a result of the inventory correction that we began to see late last summer,” said Morris Young, chief executive officer. “Despite lower revenues, we feel confident in our market position and strong customer relationships. We have continued to focus on manufacturing efficiencies, and are having increasing success in our recycling efforts, which benefitted our gross margin performance.
"As we look forward, we believe that the trends that have driven our revenue and customer expansion remain intact. We continue to excel in our technical capabilities and are readying our business to support new applications and future growth. Further, we continue to work towards improving our efficiency, and are focusing on accelerating our return to profitability.”
Revenue for Q1 2023 was $19.4 million, compared with $26.8 million for Q4 2022 and $39.7 million for Q1 2022. GAAP gross margin was 26.3 percent of revenue for Q1 2023, compared with 32.1 percent of revenue for Q4 2022 and 33.6 percent for Q1 2022. Non-GAAP gross margin was 26.9 percent of revenue for Q1 2023, compared with 32.5 percent of revenue for Q4 2022 and 33.8 percent for the Q1 2022. GAAP operating expenses were $9.5 million for Q1 2023, compared with $9.6 million for Q4 2022 and $9.6 million for Q1 2022. Non-GAAP operating expenses were $8.7 million for Q1 2023, compared with $9.0 million for Q4 2022 and $8.6 million for Q1 2022.
GAAP operating profit/(loss) for Q1 2023 was an operating loss of ($4.4) million, compared with an operating loss of ($1.0) million for Q4 2022 and an operating profit of $3.7 million for Q1 2022. Non-GAAP operating profit/(loss) for Q1 2023 was an operating loss of ($3.5) million, compared with an operating loss of ($0.3) million for Q4 2022 and an operating profit of $4.8 million for Q1 2022.
GAAP net income/(loss) in Q1 2023 was a loss of ($3.3) million, or ($0.08) per share, compared with net income of $1.3 million or $0.03 per share for Q4 2022 and net income of $3.2 million or $0.07 per share for Q1 2022. Non-GAAP net income/(loss) in Q1 2023 was net loss of ($2.4) million, or ($0.06) per share, compared with net income of $2.1 million or $0.05 per share in Q4 2022 and net income of $4.3 million or $0.10 per share for Q1 2022.
STAR Market update
On January 10, 2022, AXT announced that Beijing Tongmei Xtal Technology., its subsidiary in Beijing, China, submitted to the Shanghai Stock Exchange its application to list its shares in an initial public offering on the SSE’s Sci-Tech innovAtion boaRd (the STAR Market). On July 12, 2022, the SSE approved the listing of Tongmei’s shares in an IPO on the STAR Market. On August 1, 2022, the China Securities Regulatory Commission accepted for review Tongmei’s IPO application. The STAR Market IPO remains subject to review and approval by the CSRC and other authorities.
