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26 February 2014

AXT’s revenue falls 9% in Q4 to $18.6m, but decline in GaAs levels out

AXT Inc of Fremont, CA, USA has reported full-year revenue of $85.3m, down 3.5% on 2012’s $88.4m. This includes fourth-quarter revenue of $18.6m, 1.6% below the $18.9m a year ago but down 9% on $20.5m last quarter.

Fiscal Q4/2012 Q1/2013 Q2/2013 Q3/2013 Q4/2013
Revenue $18.9m $22.4m $23.8m $20.5m $18.6m

“Our fiscal year 2013 was among our most difficult years, with a significant technology transition, market consolidation and customer-specific technical issues,” notes CEO Morris Young.

By product sector for fourth-quarter 2013, gallium arsenide (GaAs) substrate revenue was $8.9m, down 21% on $11.3m a year ago but only slightly below the $9m last quarter (following a 16% sequential drop the prior quarter). Indium phosphide (InP) substrate revenue was $1.8m, up on $1.4m last quarter and $1.6m a year ago. Raw materials revenue was $4.3m, down slightly on $4.6m last quarter and level with a year ago. However, germanium (Ge) substrate revenue was $3.6m, more than double the $1.7m a year ago but down 35% on $5.5m last quarter.

Gross margin was 15.1%, rebounding from 11.9% last quarter but still below 19.5% a year ago. Full-year gross margin has more than halved, from 28.1% for 2012 to 13.9% for 2013.

Operating expenses were $4.4m, cut from $5.1m last quarter, due mainly to selling, general & administrative (SG&A) expenses falling from $4.3m to $3.6m. However, full-year operating expenses rose from $18.9m in 2012 to $19.5m in 2013.

Net loss was $1.2m, cut from $2.3m last quarter but above the $0.8m a year ago. Full-year net loss was $8m, compared with net income of $3.1m for 2012. During Q4/2013, cash and cash equivalents fell from $27.7m to $25m.

“We are now focusing our efforts on growing our market presence in strategic areas, and leveraging our low-cost manufacturing as a competitive advantage,” says Young. “In the meantime, we are sizing our operations to be more in line with the demand environment and are implementing a number of programs to improve our gross margins and lower our operating expenses,” he adds. “We continue to focus on cash management.”

See related items:

AXT’s revenue falls 14% in Q3 to $20.5m, driven by wireless consolidation and new technologies

AXT’s chief financial officer resigns

AXT’s revenue grows 4.5% in Q2

AXT reports revenue up 18% in Q1 to $22.4m, driven by Ge substrates and raw materials

AXT enters loss as revenue falls a further 9% in Q4

Tags: AXT GaAs GaAs substrate InP Germanium

Visit: www.axt.com

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