/EINPresswire.com/ -- FREMONT, CA -- (Marketwired) -- 05/02/16 -- AXT, Inc. (NASDAQ: AXTI), a leading manufacturer of compound semiconductor substrates, today reported financial results for the first quarter, ended March 31, 2016.

First Quarter 2016 Results

Revenue for the first quarter of 2016 was $18.7 million, compared with $18.1 million in the fourth quarter of 2015.

Gross margin was 28.1 percent of revenue for the first quarter of 2016, compared with 17.1 percent of revenue in the fourth quarter of 2015.

Operating expenses were $4.8 million in the first quarter of 2016, compared with $4.8 million in the fourth quarter of 2015.

Operating profit for the first quarter of 2016 was $0.5 million compared with an operating loss of $1.7 million in the fourth quarter of 2015.

Net interest and other income for the first quarter of 2016 was a loss of $0.2 million, compared with a gain of $0.1 million in the fourth quarter of 2015.

Net profit in the first quarter of 2016 was $42,000, or $0.00 per share, compared with a net loss of $1.2 million or a loss of $0.04 per diluted share in the fourth quarter of 2015.

Management Qualitative Comments
"Q1 was a strong quarter for AXT in which we exceeded our revenue and profitability guidance, and posted a strong increase in both our gross and operating margins from the prior quarter," said Morris Young, chief executive officer. "Our indium phosphide revenue was our strongest in recent years. In addition, our manufacturing team continues to work on efficiency and yield improvement, and these efforts along with our product mix helped improve our gross margin in the quarter."

Conference Call
The company will host a conference call to discuss these results today at 1:30 p.m. PT. The conference call can be accessed at (719) 325-2469 (passcode 4866670). The call will also be simulcast on the Internet at www.axt.com. Replays will be available at (719) 457-0820 (passcode 4866670) until May 8, 2016. 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 http://www.axt.com or by calling the company's Investor Relations Department at (510) 438-4700.

About AXT, Inc.
AXT designs, develops, manufactures and distributes high-performance compound and single element semiconductor substrates comprising indium phosphide (InP), gallium arsenide (GaAs) 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 applications. 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 http://www.axt.com.

Safe Harbor Statement
The foregoing paragraphs contain forward-looking statements within the meaning of the Federal securities laws, including, for example, statements regarding the market demand for our products, our market opportunity, and our expectations with respect to our business prospects. These forward-looking statements are based upon assumptions that are subject to uncertainties and factors relating to the company's operations and business environment, which could cause actual results 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; policies and regulations in China; 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; our ability to control costs, our ability to utilize our manufacturing capacity; product yields and their impact on gross margins; and other factors as set forth in the company's annual report on Form 10-K, quarterly reports on Form 10-Q 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.

FINANCIAL TABLES TO FOLLOW

                                 AXT, INC.
              CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
              (Unaudited, in thousands, except per share data)

                                                      Three Months Ended
                                                           March 31,
                                                   ------------------------
                                                       2016         2015
                                                   -----------  -----------

Revenue                                            $    18,713  $    20,064
Cost of revenue                                         13,460       15,315
                                                   -----------  -----------
Gross profit                                             5,253        4,749
                                                   -----------  -----------

Operating expenses:
  Selling, general and administrative                    3,374        5,251
  Research and development                               1,381        1,241
                                                   -----------  -----------
    Total operating expenses                             4,755        6,492
                                                   -----------  -----------
Income (loss) from operations                              498       (1,743)
Interest income, net                                        98           97
Equity in earnings of unconsolidated joint
 ventures                                                 (456)         200
Other income (expense), net                                190          633
                                                   -----------  -----------

Income (loss) before provision for income taxes            330         (813)
Provision for (benefit from) income taxes                  397           86
                                                   -----------  -----------
Net income (loss)                                          (67)        (899)

Less: Net income (loss) attributable to
 noncontrolling interest                                   109         (125)
                                                   -----------  -----------
Net income (loss) attributable to AXT, Inc.        $        42  $    (1,024)
                                                   ===========  ===========

Net income (loss) attributable to AXT, Inc. per
 common share:
  Basic                                            $     (0.00) $     (0.03)
                                                   ===========  ===========
  Diluted                                          $     (0.00) $     (0.03)
                                                   ===========  ===========

Weighted average number of common shares
 outstanding:
  Basic                                                 32,002       32,553
                                                   ===========  ===========
  Diluted                                               32,002       32,553
                                                   ===========  ===========



                                 AXT, INC.
                   CONDENSED CONSOLIDATED BALANCE SHEETS
                         (Unaudited, in thousands)

                                                 March 31,     December 31,
                                                    2016           2015
                                               -------------  -------------
Assets:
Current assets
  Cash and cash equivalents                    $      25,067  $      24,875
  Short-term investments                               9,053         11,437
  Accounts receivable, net                            19,711         18,468
  Inventories                                         38,822         38,012
  Related party notes receivable - current                 -              -
  Prepaid expenses and other current assets            4,386          4,096
                                               -------------  -------------
      Total current assets                            97,039         96,888

Long-term investments                                  9,211          7,691
Property, plant and equipment, net                    31,141         31,422
Related party notes receivable - long-term             1,792          1,781
Other assets                                          13,544         14,114

                                               -------------  -------------
    Total assets                               $     152,727  $     151,896
                                               =============  =============

Liabilities and stockholders' equity:
Current liabilities
  Accounts payable                             $       8,034  $       6,460
  Accrued liabilities                                  5,357          6,381
                                               -------------  -------------
    Total current liabilities                         13,391         12,841

Long-term portion of royalty payments                  1,006          1,150
Other long-term liabilities                              308            344
                                               -------------  -------------
    Total liabilities                                 14,705         14,335
                                               -------------  -------------

Stockholders' equity:
  Preferred stock                                      3,532          3,532
  Common stock                                            32             32
  Additional paid-in capital                         194,899        194,646
  Accumulated deficit                                (70,579)       (70,621)
  Accumulated other comprehensive income               4,665          4,382
                                               -------------  -------------
    Total AXT, Inc. stockholders' equity             132,549        131,971

Noncontrolling interest                                5,473          5,590
                                               -------------  -------------
    Total stockholders' equity                       138,022        137,561

                                               -------------  -------------
    Total liabilities and stockholders' equity $     152,727  $     151,896
                                               =============  =============

Contacts:
Gary Fischer
Chief Financial Officer
(510) 438-4700

Leslie Green
Green Communications Consulting, LLC
(650) 312-9060

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