Management Qualitative Comments
“We believe we are now beginning to see a recovery in our markets,” said
Fourth Quarter 2023 Results
In order to provide better clarity on its operational and financial results, AXT reports its financial results on both a GAAP and non-GAAP basis. Non-GAAP results exclude stock-based compensation expense. Investors can find GAAP to non-GAAP reconciliation tables in the financial statements in this earnings release.
- Revenue for the fourth quarter of 2023 was
$20.4 million , compared with$17.4 million in the third quarter of 2023 and$26.8 million for the fourth quarter of 2022. - GAAP gross margin was 22.6 percent of revenue for the fourth quarter of 2023, compared with 10.7 percent of revenue in the third quarter of 2023 and 32.1 percent for the fourth quarter of 2022.
- Non-GAAP gross margin, after excluding charges for stock-based compensation, was 23.2 percent of revenue for the fourth quarter of 2023, compared with 11.3 percent of revenue in the third quarter of 2023 and 32.5 percent for the fourth quarter of 2022.
- GAAP operating expenses were
$8.2 million in the fourth quarter of 2023. This compares with$8.6 million in the third quarter of 2023 and$9.6 million for the fourth quarter of 2022. - Non-GAAP operating expenses were
$7.5 million in the fourth quarter of 2023. This compares with$7.8 million in the third quarter of 2023 and$9.0 million for the fourth quarter of 2022. - GAAP operating loss for the fourth quarter of 2023 was an operating loss of
($3.6) million , compared with an operating loss of($6.7) million in the third quarter of 2023 and an operating loss of($1.0) million for the fourth quarter of 2022. - Non-GAAP operating loss for the fourth quarter of 2023 was an operating loss of
($2.7) million , compared with an operating loss of($5.8) million in the third quarter of 2023 and an operating loss of($0.3) million for the fourth quarter of 2022. - Non-operating income and expense, taxes and minority interest for the fourth quarter of 2023 was a net loss of
($0.1) million , compared with a net gain of$0.9 million in the third quarter of 2023 and a net gain of$2.3 million for the fourth quarter of 2022. - GAAP net income/(loss), after minority interests, for the fourth quarter of 2023 was a net loss of
($3.6) million , or ($0.09 ) per share, compared with a net loss of($5.8) million or ($0.14 ) per share in the third quarter of 2023, and net income of$1.3 million or$0.03 per share for the fourth quarter of 2022. - Non-GAAP net income/(loss) for the fourth quarter of 2023 was a net loss of
($2.8) million , or ($0.07 ) per share, compared with a net loss of($4.9) million or ($0.12 ) per share in the third quarter of 2023, and net income of$2.1 million or$0.05 per share for the fourth quarter of 2022.
Fiscal Year 2023 Results (
- Revenue for fiscal year 2023 was
$75.8 million , compared with$141.1 million in fiscal year 2022. - GAAP gross margin for fiscal year 2023 was 17.6 percent of revenue, compared with 36.9 percent of revenue in fiscal year 2022.
- Non-GAAP gross margin for fiscal year 2023 was 18.1 percent of revenue, compared with 37.2 percent of revenue in fiscal year 2022.
- GAAP operating expenses for fiscal year 2023 were
$34.9 million , compared with$39.6 million in fiscal year 2022. - Non-GAAP operating expenses for fiscal year 2023 were
$31.8 million , compared with$35.9 million in fiscal year 2022. - GAAP operating profit/(loss) for fiscal year 2023 was an operating loss of
($21.6) million compared with an operating profit of$12.6 million in fiscal 2022. - Non-GAAP operating profit/(loss) for fiscal year 2023 was
($18.0) million compared with$16.6 million in fiscal 2022. - GAAP net income/(loss) for fiscal 2023 was a net loss of
($17.9) million , or ($0.42 ) per share, compared with net income of$15.8 million , or$0.37 per share for fiscal 2022. - Non-GAAP net income/(loss) for fiscal 2023 was a net loss of
($14.3) million , or ($0.34 ) per share, compared with net income of$19.8 million , or$0.46 per share for fiscal 2022.
STAR Market Listing Update
On
Conference Call
The company will host a conference call to discuss these results today at
About
AXT is a material science company that develops and manufactures high-performance compound and single element semiconductor substrate wafers comprising indium phosphide (InP), gallium arsenide (GaAs) and germanium (Ge). The company’s substrate wafers are used when a typical silicon substrate wafer cannot meet the performance requirements of a semiconductor or optoelectronic device. End markets include 5G infrastructure, data center connectivity (silicon photonics), passive optical networks, LED lighting, lasers, sensors, power amplifiers for wireless devices and satellite solar cells. AXT’s worldwide headquarters are in
Safe Harbor Statement
The foregoing paragraphs contain forward-looking statements within the meaning of the Federal securities laws, including, for example, statements regarding the timing and completion of the proposed listing of shares of Tongmei on the STAR Market. Additional examples of forward-looking statements include statements regarding the market demand for our products, our product mix, our growth prospects and opportunities for continued business expansion, including technology trends, new applications and the ramping of Tier-1 customers, our market opportunity, our ability to lead our industry, our relocation, our expectations with respect to our business prospects and financial results, including our gross margin performance, and our development of larger diameter substrates that we believe will enable the next generation of technology innovation across a number of end-markets. 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: the requests for redemptions by private equity funds in
FINANCIAL TABLES TO FOLLOW
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited, in thousands, except per share data) | ||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
Revenue | $ | 20,429 | $ | 26,795 | $ | 75,795 | $ | 141,118 | ||||||||
Cost of revenue | 15,802 | 18,199 | 62,477 | 88,997 | ||||||||||||
Gross profit | 4,627 | 8,596 | 13,318 | 52,121 | ||||||||||||
Operating expenses: | ||||||||||||||||
Selling, general and administrative | 5,367 | 5,935 | 22,806 | 25,654 | ||||||||||||
Research and development | 2,820 | 3,662 | 12,081 | 13,913 | ||||||||||||
Total operating expenses | 8,187 | 9,597 | 34,887 | 39,567 | ||||||||||||
Income (loss) from operations | (3,560 | ) | (1,001 | ) | (21,569 | ) | 12,554 | |||||||||
Interest expense, net | (384 | ) | (401 | ) | (1,527 | ) | (1,071 | ) | ||||||||
Equity in income (loss) of unconsolidated joint ventures | (460 | ) | 649 | 1,884 | 5,957 | |||||||||||
Other income, net | 897 | 2,245 | 2,179 | 3,487 | ||||||||||||
Income (loss) before provision (benefit) for income taxes | (3,507 | ) | 1,492 | (19,033 | ) | 20,927 | ||||||||||
Provision (benefit) for income taxes | 252 | (3 | ) | 160 | 2,185 | |||||||||||
Net income (loss) | (3,759 | ) | 1,495 | (19,193 | ) | 18,742 | ||||||||||
Less: Net (income) loss attributable to noncontrolling interests and redeemable noncontrolling interests | 138 | (154 | ) | 1,312 | (2,931 | ) | ||||||||||
Net income (loss) attributable to | $ | (3,621 | ) | $ | 1,341 | $ | (17,881 | ) | $ | 15,811 | ||||||
Net income (loss) attributable to AXT, Inc. per common share: | ||||||||||||||||
Basic | $ | (0.09 | ) | $ | 0.03 | $ | (0.42 | ) | $ | 0.37 | ||||||
Diluted | $ | (0.09 | ) | $ | 0.03 | $ | (0.42 | ) | $ | 0.37 | ||||||
Weighted-average number of common shares outstanding: | ||||||||||||||||
Basic | 42,851 | 42,383 | 42,643 | 42,104 | ||||||||||||
Diluted | 42,851 | 42,705 | 42,643 | 42,715 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited, in thousands) | ||||||||
2023 | 2022 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 37,752 | $ | 34,948 | ||||
Restricted cash | 12,362 | 6,400 | ||||||
Short-term investments | 2,140 | 9,339 | ||||||
Accounts receivable, net | 19,256 | 29,252 | ||||||
Inventories | 86,503 | 89,629 | ||||||
Prepaid expenses and other current assets | 12,643 | 13,977 | ||||||
Total current assets | 170,656 | 183,545 | ||||||
Long-term investments | — | 2,118 | ||||||
Property, plant and equipment, net | 166,348 | 161,017 | ||||||
Operating lease right-of-use assets | 2,799 | 1,761 | ||||||
Other assets | 18,898 | 21,631 | ||||||
Total assets | $ | 358,701 | $ | 370,072 | ||||
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 9,617 | $ | 10,084 | ||||
Accrued liabilities | 19,019 | 18,164 | ||||||
Bank loans | 52,921 | 47,078 | ||||||
Total current liabilities | 81,557 | 75,326 | ||||||
Noncurrent operating lease liabilities | 2,351 | 1,322 | ||||||
Other long-term liabilities | 5,647 | 3,678 | ||||||
Total liabilities | 89,555 | 80,326 | ||||||
Redeemable noncontrolling interests | 41,663 | 44,846 | ||||||
Stockholders’ equity: | ||||||||
Preferred stock | 3,532 | 3,532 | ||||||
Common stock | 44 | 44 | ||||||
Additional paid-in capital | 238,452 | 235,308 | ||||||
Accumulated deficit | (32,040 | ) | (14,159 | ) | ||||
Accumulated other comprehensive loss | (5,999 | ) | (3,118 | ) | ||||
Total AXT, Inc. stockholders’ equity | 203,989 | 221,607 | ||||||
Noncontrolling interests | 23,494 | 23,293 | ||||||
Total stockholders’ equity | 227,483 | 244,900 | ||||||
Total liabilities, redeemable noncontrolling interests and stockholders’ equity | $ | 358,701 | $ | 370,072 |
Reconciliation of Statements of Operations Under GAAP and Non-GAAP (Unaudited, in thousands) | |||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
GAAP gross profit | $ | 4,627 | $ | 8,596 | $ | 13,318 | $ | 52,121 | |||||||
Stock-based compensation expense | 103 | 102 | 414 | 379 | |||||||||||
Non-GAAP gross profit | $ | 4,730 | $ | 8,698 | $ | 13,732 | $ | 52,500 | |||||||
GAAP operating expenses | $ | 8,187 | $ | 9,597 | $ | 34,887 | $ | 39,567 | |||||||
Stock-based compensation expense | 719 | 643 | 3,126 | 3,627 | |||||||||||
Non-GAAP operating expenses | $ | 7,468 | $ | 8,954 | $ | 31,761 | $ | 35,940 | |||||||
GAAP income (loss) from operations | $ | (3,560 | ) | $ | (1,001 | ) | $ | (21,569 | ) | $ | 12,554 | ||||
Stock-based compensation expense | 822 | 745 | 3,540 | 4,006 | |||||||||||
Non-GAAP income (loss) from operations | $ | (2,738 | ) | $ | (256 | ) | $ | (18,029 | ) | $ | 16,560 | ||||
GAAP net income (loss) | $ | (3,621 | ) | $ | 1,341 | $ | (17,881 | ) | $ | 15,811 | |||||
Stock-based compensation expense | 822 | 745 | 3,540 | 4,006 | |||||||||||
Non-GAAP net income (loss) | $ | (2,799 | ) | $ | 2,086 | $ | (14,341 | ) | $ | 19,817 | |||||
GAAP net income (loss) per diluted share | $ | (0.09 | ) | $ | 0.03 | $ | (0.42 | ) | $ | 0.37 | |||||
Stock-based compensation expense per diluted share | $ | 0.02 | $ | 0.02 | $ | 0.08 | $ | 0.09 | |||||||
Non-GAAP net income (loss) per diluted share | $ | (0.07 | ) | $ | 0.05 | $ | (0.34 | ) | $ | 0.46 | |||||
Shares used to compute diluted net income per share | 42,851 | 42,705 | 42,643 | 42,715 |
Contacts:Gary Fischer Chief Financial Officer (510) 438-4700 Leslie GreenGreen Communications Consulting, LLC (650) 312-9060
Source:
2024 GlobeNewswire, Inc., source