AXT, Inc. Supplies First 8-Inch Gallium Arsenide Wafers to Major Customer

Rhea-AI Summary

AXT, Inc. (NasdaqGS: AXTI) has achieved a significant milestone by developing and shipping its first 8-inch diameter gallium arsenide (GaAs) substrates to a major customer. These silicon doped, n-type substrates exhibit low etch pit densities and slip lines, essential for high-volume applications such as VCSELs for 3D sensors and LiDAR. The company expects increased demand for 8-inch GaAs wafers as these applications grow. AXT’s new manufacturing facilities are designed for scaling up production, ensuring commercial viability for these substrates.

Positive

• Successful development and shipment of 8-inch GaAs substrates.
• Demonstrated low etch pit densities and low slip lines, indicating quality.
• Increased market interest for 8-inch GaAs wafers due to applications in VCSELs and LiDAR.
• New manufacturing facilities support high-volume production.

Negative

• Future development work remains on the 8-inch GaAs project.
• Market demand for applications like LiDAR and microLEDs is uncertain.
• Potential environmental restrictions on gallium arsenide could impact production.

FREMONT, Calif., April 28, 2021 (GLOBE NEWSWIRE) -- AXT, Inc. (NasdaqGS: AXTI), a leading manufacturer of compound semiconductor substrate wafers, today announced that is has developed and shipped its first 8-inch diameter gallium arsenide (GaAs) substrates to a major customer. The 8-inch GaAs substrates, which are silicon doped, n-type substrates, demonstrate low etch pit densities (EPD) and low levels of slip lines.

“This is a significant achievement and an important milestone for AXT,” said Morris Young, chief executive officer. “Every step up in diameter size comes with a major increase in the technical challenge of producing it. But AXT has always been a pioneer in this area, with the entrepreneurial spirit to drive innovation in order to unlock the potential for new applications. Further, the material quality of our first wafers demonstrates our commitment to excellence and the differentiation of our VGF crystal growth process. We are pleased to be able to offer our customers meaningful advantages in scalability, low stress and low defect rates.”

AXT has received significant interest from several customers due to the market development of high-volume applications, including VCSELs for 3D sensors and LiDAR, as well as microLEDs for displays. AXT predicts a broader scaling of the demand for 8-inch GaAs wafers when these applications are adopted.

Young went on to say, “Although we still have development work to undertake on this project, our new world-class manufacturing facilities in Dingxing and Kazuo can enable commercial viability of 8-inch gallium arsenide wafers. Both of AXT’s new facilities have been purposefully designed and built for high-volume manufacturing of compound semiconductor substrate wafers, utilizing advanced equipment and improved automation. Further, manufacturing volume expansion was taken into account when designing the new facilities and we believe we have a short path to develop and launch a high-volume manufacturing line for 8-inch GaAs substrates.”

About AXT, Inc.

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 Fremont, California where the company maintains sales, administration and customer service functions. AXT has its Asia headquarters in Beijing, China and manufacturing facilities in three separate locations in China. In addition, as part of its supply chain strategy, the Company has partial ownership in ten companies in China producing raw materials for its manufacturing process. For more information, see AXT’s website at http://www.axt.com.

Forward-Looking Statements

The foregoing paragraphs contain forward-looking statements within the meaning of the Federal securities laws, including, for example, statements regarding a broader scaling of the demand for 8-inch GaAs wafers, future interest from customers, the market development of high-volume applications, the undertaking of additional development with respect to 8-inch GaAs wafers and success in such development to enable commercial viability of 8-inch GaAs wafers and the belief that AXT has a short path to develop and launch a high-volume manufacturing line for 8-inch GaAs substrates. 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: actual market demand and acceptance of 3D sensors, LiDAR or displays utilizing microLEDs for screen displays in consumer products; process technology constraints; impurities effecting the quality of 8-inch wafers; our ability to scale up volume at our new sites; possible environmental restrictions on gallium arsenide; end-user acceptance of products containing chips or devices fabricated on our substrates; our ability to bring new products to market; product announcements by our competitors; the ability to control costs and improve efficiency; the ability to utilize our manufacturing capacity; product yields and their impact on gross margins; possible factory shutdowns as a result of air pollution in China; COVID-19 or other outbreaks of a contagious disease; policies and regulations in China and other factors as set forth in the company’s Annual Report on Form 10-K, quarterly reports on Form 10-Q and other filings made with the Securities and Exchange Commission. Each of these factors is difficult to predict and many are beyond the company’s control. The company does not undertake any obligation to update any forward-looking statement, as a result of new information, future events or otherwise.

Contacts:

Gary Fischer Chief Financial Officer (510) 438-4700 Leslie Green Green Communications Consulting, LLC (650) 312-9060

FAQ

What is the recent development by AXT, Inc. regarding GaAs substrates?

AXT, Inc. has developed and shipped its first 8-inch diameter gallium arsenide (GaAs) substrates, marking a significant milestone in its production capabilities.

How does AXT's new manufacturing facility contribute to its operations?

The new manufacturing facilities in Dingxing and Kazuo are designed for high-volume production of GaAs wafers, enhancing commercial viability and scalability.

What are the potential applications for AXT's 8-inch GaAs substrates?

The 8-inch GaAs substrates are aimed at high-volume applications such as VCSELs for 3D sensors and LiDAR, as well as microLEDs for displays.

What challenges does AXT face with the 8-inch GaAs substrate project?

AXT faces challenges such as market uncertainty for demand, the need for further development of the substrates, and potential environmental restrictions affecting production.

What are the expected market trends for AXT's GaAs wafers?

AXT predicts an increase in demand for 8-inch GaAs wafers as applications in 3D sensors and LiDAR become more widely adopted.