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AXT Inc reported an 11% revenue decline to $88.3 million in 2025, with Q4 revenue at $23 million, down 8.4% year-over-year. This was due to delays in export permits for indium phosphide from China's Ministry of Commerce.

AXT's gross margin decreased to 13.1% for 2025, and the company recorded a net loss of $18 million. However, AXT expects Q1 2026 revenue growth from indium phosphide for AI applications, with a backlog exceeding $60 million. The company has expanded production capacity and aims to support a $35 million quarterly revenue run-rate by the end of 2026, focusing on meeting the growing demand in the optical and AI infrastructure markets.