23 February 2012

AXT reports revenue up 9% for full-year 2011, but down 25% in Q4

For full-year 2011, AXT Inc of Fremont, CA, USA, which makes gallium arsenide, indium phosphide and germanium substrate and raw materials, has reported revenue of $104.1m, up 9% on 2010’s $95.5m. Gross margin rose from 38.2% to 43%, and net income rose from $18.7m to $20.3m.

Quarterly revenue




Yearly revenue




“Despite near-term challenges, for 2011 as a whole, we posted the strongest fiscal year results in more than 10 years,” says CEO Morris Young. “Across our business, we placed great emphasis on diversification of our customer base, with notable success in every product category,” he adds. “We strengthened our sales presence and product specifications to enhance our participation in key geographic areas, such as China, Japan and Taiwan.”

However, most recently, for fourth-quarter 2011, revenue was $21.2m, down 25% on $28.3m in Q3 and 21% on $26.9m a year ago. In particular, total gallium arsenide (GaAs) substrate revenue was $11.1m, down 41% on $18.7m both in Q3 and a year ago. Indium phosphide (InP) substrate revenue was $724,000, less than half the $1.5m in Q3 and down 34% on $1.1m a year ago. Germanium (Ge) substrate revenue was $3m, level on Q3 but down 13% on $3.4m a year ago. Raw materials sales were $6.4m, up 25% on $5.1m in Q3 and almost double the $3.5m a year ago.

After rising from 39.8% a year ago to 43.2% in Q3, gross margin has fallen to 36.9%. Although down from $5m a year ago, operating expenses have risen slightly from $4.2m in Q3 to $4.5m. “Throughout 2011, we carefully managed our expense levels and further improved our manufacturing and operating efficiency to keep pace with the pricing requirements of our customers and the sizeable fluctuations in raw materials costs,” notes Young. Nevertheless, net income was $2.6m, down from $4.9m a year ago and less than half the $6.5m in Q3.

“We laid important groundwork to prepare our company for growth as we enter the next semiconductor cycle as well as increasing demand relating to a number of key secular trends that we play into,” says Young. “Further, we took a critical, measured step to ensure that we have the appropriate level of capacity at the right time to meet market demand as it increases over the next several years,” he adds.

“I am pleased by the way our team executed on its mission in 2011 and believe that we are well positioned for continued growth in 2012,” concludes Young. For first-quarter 2012, AXT estimates revenue to either stabilize or grow, to $21-24m.

See related items:

AXT’s revenue falls 5.7% in Q3 to $28.3m

AXT Q2 revenue rebounds by 22% sequentially to $30m

AXT’s Q1 revenue falls 8.6% to $24.6m

AXT’s Q4/2010 revenue of $26.9m up 51% year-on-year

Tags: AXT GaAs GaAs substrate InP Germanium

Visit: www.axt.com

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