AXT, Inc. Reports Record Q2 2000 Financial Results

Substrate Sales Increase 37 Percent Over Q100 and 82 Percent Over Q299

Fremont, CA. AXT, Inc. (Nasdaq: AXTI), a leading manufacturer of compound semiconductor substrates and optoelectronic devices, today reported financial results for the second quarter ended June 30, 2000. Revenues for the second quarter of 2000 were a record $28.9 million, up 39 percent from $20.8 million in revenues reported in the second quarter of 1999, and up 21 percent from the $23.9 million reported in the first quarter of 2000.

Net income for the second quarter of 2000 was $2.4 million, or $0.12 per share on approximately 20.1 million shares. This compares with second quarter 1999 net income of $1.3 million, or $0.07 per share on approximately 19.7 million shares, excluding acquisition costs of $2.8 million and an extraordinary item of $508 thousand; and with net income of $2.0 million, or $0.10 per share on approximately 20.1 million shares for the first quarter of 2000. All per share amounts are computed on a fully diluted basis.

"This has been an exciting quarter for AXT," said Morris Young, president and chief executive officer. "Our substrate business continues to grow to record levels, and we are successfully ramping our production of both gallium arsenide and indium phosphide in order to keep pace with the demand. Furthermore, we were very pleased to announce our new blue, green and cyan LED products during the second quarter, which complement our current spectrum. We will continue to make the appropriate investments in the technology and personnel to take advantage of the tremendous opportunity before us," he said.

The company also announced that Don Tatzin has joined AXT as chief financial officer. Tatzin has served as a member of the company s board of directors since February 1998, and has functioned as AXT s interim chief financial officer since May 2000. He has more than 24 years of experience in senior management positions both in the U.S. and in Australia, including 17 years as a director and consultant with Arthur D. Little, an international management consulting firm.

"It is with great pleasure that I welcome Don to AXT on a permanent basis," added Young. "He has made strong contributions to AXT as a member of our board of directors, and his work as interim CFO over the last three months has been very beneficial. He has strengthened the financial architecture of the company and improved our processes. I believe that he will be a strong asset to the company and I look forward to continue working with him in this new capacity," he said.

In addition, the company reported that it has formally changed its name to AXT, Inc.

Conference Call

A conference call will be held today at 1:30 p.m. PST to discuss these announcements. To participate in the call, please dial 712-257-3060. The passcode is American Xtal Technology. A replay of the call will be available through August 24, 2000 by dialing 402-220-0184. The conference call will also be webcast. Those wishing to participate in this fashion may access the call via both www.axt.com and www.streetevents.com. A replay of the webcast will also be available through August 24, 2000.

Safe Harbor Statement

This press release contains forward-looking statements regarding, among other matters, the company s future financial performance, new product releases, the company s building of capacity, and the increasing market demand for the company s products. Forward-looking statements address matters that are subject to a number of risks and uncertainties. In addition to the general risks associated with the development of complex technology and the risks associated with the company s acquisition and the integration of Lyte Optronics, Inc., future results of the company will depend on a variety of factors, including, among others, the risks associated with conducting operations in countries other than the U.S., the timing of significant orders, unexpected cancellations or returns by customers, the ability of the company to bring new products to market, the timing of new product releases and product announcements by the company s competitors and other competitive factors. Reference is made to the company s filings with the Securities and Exchange Commission, including the Company s Form 10-K for the year ended December 31, 1999, for further discussion of risks and uncertainties regarding the company s business.

About AXT, Inc.

AXT designs, develops, manufactures and markets high-performance substrates for the communications industry. AXT is also a leading producer of diodes for laser pointers and light-emitting diodes (LEDs), such as blue, cyan and green LEDs, for the display and lighting industries. The company s proprietary Vertical Gradient Freeze (VGF) crystal growth technology produces low-defect, semi-insulating and semi-conducting gallium arsenide, germanium and indium phosphide wafers. The company has also introduced gallium nitride substrates for manufacturing blue LEDs. For more information, see AXT s website at www.axt.com. The company can also be reached at 4281 Technology Drive, Fremont, California 94538 or call 510-683-5900. AXT is traded on the Nasdaq National Market under the symbol AXTI.

Contact: Don Tatzin, Chief Financial Officer of AXT, Inc Tel: 510-683-5900 or Leslie Green of Stapleton Communications Inc. Tel: 650-470-0200