AXT Inc (NASDAQ:AXTI), a developer of compound semiconductor substrates, has seen its stock price touch a 52-week low, reaching $1.93. This price level reflects a significant downturn from the company's performance over the past year, with AXT Inc experiencing a 1-year change of -8.45%. The decline to this year's low point underscores the market's current sentiment towards the semiconductor industry, which has faced various pressures including supply chain disruptions and fluctuating demand. Investors are closely monitoring the company's strategies to navigate these headwinds as they consider the long-term prospects of AXT Inc in a competitive and rapidly evolving sector.
In other recent news, AXT Inc. reported mixed financial results for the third quarter of 2024. The company's revenue was $23.6 million, a decrease from the previous quarter but an increase from the same period last year. The non-GAAP gross margin for the quarter was 24.3%, also down from the previous quarter but up from the same period last year. The company's non-GAAP operating loss improved to $2.6 million from $5.8 million in the third quarter of 2023.
In terms of future developments, AXT is preparing for an IPO of its subsidiary, Tongmei, on the STAR Market in Shanghai. The company also anticipates growth in the indium phosphide and gallium arsenide sectors for 2025. However, a decline in germanium revenue is projected for the fourth quarter.
These recent developments come as AXT navigates a recovering Chinese economy and focuses on returning to profitability, particularly in the indium phosphide and gallium arsenide sectors. Despite the challenges, AXT remains cautiously optimistic about the potential growth in the telecom market and the upcoming IPO of its subsidiary.
InvestingPro Insights
AXT Inc's recent stock performance aligns with several key insights from InvestingPro. The company's market capitalization stands at $85.39 million, reflecting its current valuation in light of recent market challenges. InvestingPro Tips highlight that AXT is trading at a low Price / Book multiple of 0.43, which could indicate potential undervaluation relative to its assets. However, this should be considered alongside the fact that the company is not profitable over the last twelve months, with a negative P/E ratio of -8.23.
The semiconductor industry's volatility is mirrored in AXT's stock, with InvestingPro data showing a significant 6-month price total return of -42.18%. This aligns with the InvestingPro Tip noting that the stock has taken a big hit over the last six months. Despite these challenges, AXT has shown revenue growth, with a 36.16% increase in quarterly revenue as of Q3 2024, suggesting potential for recovery.
Investors should note that analysts do not anticipate the company will be profitable this year, according to an InvestingPro Tip. This insight, combined with the company's current financial metrics, provides context for the stock's recent performance and may inform investment decisions.
For a more comprehensive analysis, InvestingPro offers 10 additional tips for AXT Inc, providing deeper insights into the company's financial health and market position.
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