AXT (AXTI) 10-Q 7 Aug 15 2015 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2015	Aug. 03, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	AXT INC
Entity Central Index Key	1,051,627
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		32,631,249
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q2
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2015

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$ 28,640	$ 28,814
Short-term investments	3,932	12,340
Accounts receivable, net of allowances of $1,041 and $823 as of June 30, 2015 and December 31, 2014	19,312	17,864
Inventories	38,901	38,574
Related party notes receivable - current	174	171
Prepaid expenses and other current assets	3,481	5,430
Total current assets	94,440	103,193
Long-term investments	13,699	7,783
Property, plant and equipment, net	33,366	33,862
Related party notes receivable - long-term	1,711	1,704
Other assets	15,000	14,975
Total assets	158,216	161,517
Current liabilities:
Accounts payable	7,323	7,137
Accrued liabilities	6,043	7,634
Total current liabilities	13,366	14,771
Long-term portion of royalty payments	1,438	1,725
Other long-term liabilities	332	333
Total liabilities	$ 15,136	$ 16,829
Commitments and contingencies (Note 11)
Stockholders' equity:
Preferred stock, $0.001 par value; 2,000 shares authorized; 883 shares issued and outstanding as of June 30, 2015 and December 31, 2014 (Liquidation preference of $6.4 million and $6.3 million as of June 30, 2015 and December 31, 2014.)	$ 3,532	$ 3,532
Common stock, $0.001 par value; 70,000 shares authorized; 32,661 and 32,837 shares issued and outstanding as of June 30, 2015 and December 31, 2014.	32	32
Additional paid-in-capital	194,714	195,419
Accumulated deficit	(69,420)	(68,393)
Accumulated other comprehensive income	7,586	7,673
Total AXT, Inc. stockholders' equity	136,444	138,263
Noncontrolling interests	6,636	6,425
Total stockholders' equity	143,080	144,688
Total liabilities and stockholders' equity	$ 158,216	$ 161,517

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) shares in Thousands, $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Current assets:
Accounts receivable, allowances for doubtful accounts	$ 1,041	$ 823
Stockholders' equity:
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	2,000	2,000
Preferred stock, shares issued (in shares)	883	883
Preferred stock, shares outstanding (in shares)	883	883
Preferred stock, liquidation preference	$ 6,400	$ 6,300
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	70,000	70,000
Common stock, shares issued (in shares)	36,631	32,837
Common stock, shares outstanding (in shares)	36,631	32,837

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) [Abstract]
Revenue	$ 21,010	$ 21,449	$ 41,074	$ 40,794
Cost of revenue	16,625	17,289	31,940	33,916
Gross profit	4,385	4,160	9,134	6,878
Operating expenses:
Selling, general and administrative	3,775	3,688	9,026	7,124
Research and development	1,389	987	2,630	1,762
Restructuring charge	0	0	0	907
Total operating expenses	5,164	4,675	11,656	9,793
Loss from operations	(779)	(515)	(2,522)	(2,915)
Interest income, net	108	127	205	254
Equity in earnings of unconsolidated joint ventures	410	625	610	1,112
Other income, net	626	476	1,259	486
Income (loss) before provision for income taxes	365	713	(448)	(1,063)
Provision for income taxes	241	152	327	211
Net income (loss)	124	561	(775)	(1,274)
Less: Net income attributable to noncontrolling interests	(127)	(242)	(252)	(447)
Net income (loss) attributable to AXT, Inc.	$ (3)	$ 319	$ (1,027)	$ (1,721)
Net income (loss) attributable to AXT, Inc. per common share:
Basic (in dollars per share)	$ 0	$ 0.01	$ (0.03)	$ (0.06)
Diluted (in dollars per share)	$ 0	$ 0.01	$ (0.03)	$ (0.06)
Weighted average number of common shares outstanding:
Basic (in shares)	32,242	32,381	32,399	32,407
Diluted (in shares)	32,242	32,597	32,399	32,407

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) [Abstract]
Net income (loss)	$ 124	$ 561	$ (775)	$ (1,274)
Other comprehensive income (loss), net of tax:
Change in foreign currency translation gain (loss), net of tax	67	81	305	(440)
Change in unrealized gain (loss) on available-for-sale investments, net of tax	(91)	149	(350)	139
Total other comprehensive income (loss), net of tax	(24)	230	(45)	(301)
Comprehensive income (loss)	100	791	(820)	(1,575)
Less: Comprehensive income attributable to the noncontrolling interest	(137)	(251)	(294)	(377)
Comprehensive income (loss) attributable to AXT, Inc.	$ (37)	$ 540	$ (1,114)	$ (1,952)

CONDENSED CONSOLIDATED STATEME6

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands		6 Months Ended
		Jun. 30, 2015	Jun. 30, 2014
Cash flows from operating activities:
Net loss		$ (775)	$ (1,274)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		2,808	2,819
Amortization of marketable securities premium		113	245
Stock-based compensation		740	589
Provision for doubtful accounts		211	9
Realized gain on sale of investments		(859)	0
Loss (gain) on disposal of property, plant and equipment		9	(10)
Loss (gain) on equity investments, net		(610)	(1,112)
Changes in assets and liabilities:
Accounts receivable, net		(1,630)	(4,396)
Inventories		(262)	3,783
Prepaid expenses and other current assets		1,954	3,300
Other assets		258	386
Accounts payable		166	(1,500)
Accrued liabilities	[1]	(1,602)	148
Other long-term liabilities		(269)	(407)
Net cash provided by operating activities		252	2,580
Cash flows from investing activities:
Purchases of property, plant and equipment		(2,174)	(600)
Proceeds from sales of property, plant and equipment		2	10
Purchases of available for sale securities		(8,664)	(3,728)
Proceeds from sales and maturities of available-for-sale securities		11,752	2,922
Investments in non-marketable equity investments		(162)	0
Return of equity method investments		286	327
Net cash provided by (used in) investing activities		1,040	(1,069)
Cash flows from financing activities:
Proceeds from common stock options exercised		76	6
Repurchases of the Company's common stock, including commission		(1,521)	0
Dividends paid by consolidated joint ventures		(80)	(83)
Net cash used in financing activities		(1,525)	(77)
Effect of exchange rate changes on cash and cash equivalents		59	(88)
Net increase (decrease) in cash and cash equivalents		(174)	1,346
Cash and cash equivalents at the beginning of the period		28,814	24,961
Cash and cash equivalents at the end of the period		$ 28,640	$ 26,307
[1]	Dividend accrued but not paid by joint ventures of $566 and $647 was included in accrued liabilities as of June 30, 2015 and June 30, 2014, respectively.

CONDENSED CONSOLIDATED STATEME7

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014	Jun. 30, 2014
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) [Abstract]
Dividends accrued but not paid by joint ventures	$ 566	$ 563	$ 647

Basis of Presentation

Basis of Presentation	6 Months Ended
	Jun. 30, 2015
Basis of Presentation [Abstract]
Basis of Presentation	Note 1. Basis of Presentation The accompanying condensed consolidated financial statements of AXT, Inc. (“AXT,” the “Company,” “we,” “us,” and “our” refer to AXT, Inc. and all of its consolidated subsidiaries) are unaudited, and have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the year-end condensed consolidated balance sheet data was derived from our audited consolidated financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. In the opinion of our management, the unaudited condensed consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments, considered necessary to present fairly the financial position, results of operations and cash flows of AXT and our consolidated subsidiaries for all periods presented. Our management has made a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America. Actual results could differ materially from those estimates. The results of operations are not necessarily indicative of the results to be expected in the future or for the full fiscal year. It is recommended that these condensed consolidated financial statements be read in conjunction with our consolidated financial statements and the notes thereto included in our 2014 Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on March 13, 2015 and our Quarterly Report on Form 10-Q for the three months ended March 31, 2015 filed with the SEC on May 8, 2015. The consolidated financial statements include the accounts of AXT, our wholly-owned subsidiary, Beijing Tongmei Xtal Technology Co., Ltd., and our majority-owned subsidiaries, Beijing JiYa Semiconductor Material Co., Ltd., Nanjing Jin Mei Gallium Co., Ltd. and Beijing BoYu Semiconductor Vessel Craftwork Technology Co., Ltd. All significant inter‑company accounts and transactions have been eliminated. Investments in business entities in which we do not have control, but have the ability to exercise significant influence over operating and financial policies (generally 20-50% ownership), are accounted for by the equity method. For majority-owned subsidiaries, we reflect the noncontrolling interest of the portion we do not own on our condensed consolidated balance sheets in stockholders’ equity and in our condensed consolidated statements of operations.

Investments and Fair Value Meas

Investments and Fair Value Measurements	6 Months Ended
	Jun. 30, 2015
Investments and Fair Value Measurements [Abstract]
Investments and Fair Value Measurements	Note 2. Investments and Fair Value Measurements Our cash and cash equivalents consist of cash and instruments with original maturities of less than 90 days. Our investments consist of instruments with original maturities of more than 90 days. As of June 30, 2015 and December 31, 2014, our cash, cash equivalents and investments are classified as follows (in thousands): June 30, 2015 December 31, 2014 Amortized Cost Gross Unrealized Gain Gross Unrealized (Loss) Fair Value Amortized Cost Gross Unrealized Gain Gross Unrealized (Loss) Fair Value Classified as: Cash $ 17,337 $ — $ — $ 17,337 $ 22,337 $ — $ — $ 22,337 Cash equivalents: Certificates of deposit 1 11,303 — — 11,303 6,454 — — 6,454 Money market fund — — — — 23 — — 23 Total cash and cash equivalents 28,640 — — 28,640 28,814 — — 28,814 Investments (available for sale): Certificates of deposit 2 8,105 1 (16 ) 8,090 10,195 1 (13 ) 10,183 Corporate bonds 9,006 — (40 ) 8,966 9,214 1 (29 ) 9,186 Corporate equity securities 200 375 — 575 44 710 — 754 Total investments 17,311 376 (56 ) 17,631 19,453 712 (42 ) 20,123 Total cash, cash equivalents and investments $ 45,951 $ 376 $ (56 ) $ 46,271 $ 48,267 $ 712 $ (42 ) $ 48,937 Contractual maturities on investments: Due within 1 year $ 3,560 $ 3,932 $ 11,631 $ 12,340 Due after 1 through 5 years 13,751 13,699 7,822 7,783 $ 17,311 17,631 $ 19,453 $ 20,123 1. Certificate of deposit with original maturities of less than 90 days. 2. Certificate of deposit with original maturities of more than 90 days. We manage our investments as a single portfolio of highly marketable securities that is intended to be available to meet our current cash requirements. We have no investments in auction rate securities. Certificates of deposit and corporate bonds are typically held until maturity. Corporate equity securities have no maturity and may be sold at any time. Our holding of corporate equity securities consist of the common stock of Intelligent Epitaxy Technology, Inc. (“IntelliEpi”) and GCS Holdings, Inc. (“GHI”) (previously Global Communication Semiconductors, Inc), both Taiwan publicly-traded companies. We began classifying IntelliEpi stock as an available-for-sale security upon its initial public offering in 2013. During the three months ended June 30, 2015, we sold all of our remaining IntelliEpi stock. From this, our cash proceeds from sales of available-for-sale investments was $515,000. Our cost was $23,000 and our gross realized gain from sales of available-for-sale investments was $492,000. During the six months ended June 30, 2015, our cash proceeds from sales of available-for-sale investments was $902,000. Our cost was $43,000 and our gross realized gain from sales of available-for-sale investments was $859,000. During the three months and six months ended June 30, 2014, our cash proceeds was $346,000, our cost was $22,000 and our gross realized gain was $324,000. Also included in available-for-sale investments at June 30, 2015 is our investment in the common stock of GHI. We began classifying this asset as an available-for-sale security during the three months ended June 30, 2015 when we determined that there was sufficient trading volume in the exchange for the stock to be deemed readily marketable. An unrealized gain of $375,000 net of tax was recorded as of June 30, 2015. These securities are valued at fair market value at June 30, 2015 and will be marked to market with changes through other comprehensive income until sold The gross unrealized losses related to our portfolio of available-for-sale securities were primarily due to changes in interest rates and market and credit conditions of the underlying securities. We have determined that the gross unrealized losses on some of our available-for-sale securities as of June 30, 2015 are temporary in nature. We periodically review our investment portfolio to identify and evaluate investments that have indications of possible impairment. Factors considered in determining whether a loss is temporary include the magnitude of the decline in market value, the length of time the market value has been below cost (or adjusted cost), credit quality, and our ability and intent to hold the securities for a period of time sufficient to allow for any anticipated recovery in market value. A portion of our investments would generate a loss if we sold them on June 30, 2015. The following table summarizes the fair value and gross unrealized losses related to available-for-sale securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of June 30, 2015 (in thousands): As of June 30, 2015 In Loss Position < 12 months In Loss Position > 12 months Total In Loss Position Fair Value Gross Unrealized (Losses) Fair Value Gross Unrealized (Losses) Fair Value Gross Unrealized (Losses) Investments: Certificates of deposit $ 6,410 $ (15 ) $ 1,199 $ (1 ) $ 7,609 $ (16 ) Corporate bonds 8,966 (40 ) — — 8,966 (40 ) Total in loss position $ 15,376 $ (55 ) $ 1,199 $ (1 ) $ 16,575 $ (56 ) The following table summarizes the fair value and gross unrealized losses related to available-for-sale securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2014 (in thousands): As of December 31, 2014 In Loss Position < 12 months In Loss Position > 12 months Total In Loss Position Fair Value Gross Unrealized (Loss) Fair Value Gross Unrealized (Loss) Fair Value Gross Unrealized (Loss) Investments: Certificates of deposit $ 4,492 $ (13 ) $ — $ — $ 4,492 $ (13 ) Corporate bonds 3,770 (27 ) 4,309 (2 ) 8,079 (29 ) Total in loss position $ 8,262 $ (40 ) $ 4,309 $ (2 ) $ 12,571 $ (42 ) Investments in Privately-held Companies We have made strategic investments in private companies located in China in order to gain access at a competitive cost to raw materials that are critical to our substrate business (see Note 6). The investment balances for all of these companies, including minority investments indirectly in privately-held companies made by our consolidated subsidiaries, accounted for under the equity method are included in “other assets” in the consolidated balance sheets and totaled $12.6 million and $12.1 million as of June 30, 2015 and December 31, 2014, respectively. As noted above, in June, 2015, we re-classified our minority investment in one company, which was as available-for- sale short-term investments and written-up to market value. Fair Value Measurements ASC topic 820, Fair value measurement (“ASC 820”) establishes three levels of inputs that may be used to measure fair value. Level 1 instrument valuations are obtained from real-time quotes for transactions in active exchange markets of the asset or identical assets. Level 2 instrument valuations are obtained from readily-available pricing sources for comparable instruments. Level 3 instrument valuations are obtained from unobservable inputs in which there is little or no market data, which require us to develop our own assumptions. On a recurring basis, we measure certain financial assets and liabilities at fair value, primarily consisting of our short-term and long-term investments. The type of instrument valued based on quoted market prices in active markets include our money market funds, which are generally classified within Level 1 of the fair value hierarchy. Other than corporate equity securities which are based on quoted market prices and classified as Level 1, we classify our available-for-sale securities including certificates of deposit, corporate bonds as having Level 2 inputs. The valuation techniques used to measure the fair value of these financial instruments having Level 2 inputs were derived from quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. We place short-term foreign currency hedges that are intended to offset the potential cash exposure related to fluctuations in the exchange rate between the United States dollar and Japanese yen. We measure the fair value of these foreign currency hedges at each month end and quarter end using current exchange rates and in accordance with generally accepted accounting principles. At quarter end any foreign currency hedges not settled are netted in “accrued liabilities” on the consolidated balance sheet and classified as Level 3 assets and liabilities. As of June 30, 2015 the net change in fair value from the placement of the hedge to settlement at each month end during the quarter had a de minimis impact to the consolidated results. There were no changes in valuation techniques or related inputs in the three months ended June 30, 2015. There have been no transfers between fair value measurements levels during the three months ended June 30, 2015. The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis in accordance with ASC 820 as of June 30, 2015 (in thousands): Balance as of June 30, 2015 Quoted Prices in Active Markets of Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents and investments: Certificates of deposit $ 19,393 $ — $ 19,393 $ — Corporate bonds 8,966 — 8,966 — Corporate equity securities 575 575 — — Total $ 28,934 $ 575 $ 28,359 $ — Liabilities: Foreign currency hedge obligations $ 29 $ — $ — $ 29 The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis in accordance with ASC 820 as of December 31, 2014 (in thousands): Balance as of December 31, 2014 Quoted Prices in Active Markets of Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents and investments: Money market fund $ 23 $ 23 $ — $ — Certificates of deposit 10,183 — 10,183 — Corporate bonds 9,186 — 9,186 — Corporate equity securities 754 754 — — Total $ 20,146 $ 777 $ 19,369 $ — Liabilities $ — $ — $ — $ — Items Measured at Fair Value on a Nonrecurring Basis Certain assets that are subject to nonrecurring fair value measurements are not included in the table above. These assets include investments in privately-held companies accounted for by equity and cost method (See Note 6). We did not record other-than-temporary impairment charges for either of these investments during the three months ended June 30, 2015 or 2014.

Inventories

Inventories	6 Months Ended
	Jun. 30, 2015
Inventories [Abstract]
Inventories	Note 3. Inventories The components of inventories are summarized below (in thousands): June 30, 2015 December 31, 2014 Inventories: Raw materials $ 20,549 $ 18,990 Work in process 15,847 16,222 Finished goods 2,505 3,362 $ 38,901 $ 38,574 As of June 30, 2015 and December 31, 2014, carrying values of inventories were net of inventory reserve of $11.4 million and $11.2 million, respectively, for excess and obsolete inventory.

Accrued Liabilities

Accrued Liabilities	6 Months Ended
	Jun. 30, 2015
Accrued Liabilities [Abstract]
Accrued Liabilities	Note 4. Accrued Liabilities The components of accrued liabilities are summarized below (in thousands): June 30, 2015 December 31, 2014 Accrued compensation and related charges $ 1,694 $ 2,656 Current portion of royalty payments 688 800 Accrued product warranty 668 802 Accrued professional services 418 509 Dividends payable by consolidated joint ventures 566 563 Accrued income taxes 279 119 Other accrued liabilities 1,730 2,185 $ 6,043 $ 7,634

Related Party Transactions

Related Party Transactions	6 Months Ended
	Jun. 30, 2015
Related Party Transactions [Abstract]
Related Party Transactions	Note 5. Related Party Transactions In August 2011, our consolidated joint venture, Beijing JiYa Semiconductor Material Co., Ltd. (“JiYa”), entered into a non-interest bearing note agreement in the amount of $1.7 million for a loan to one of its equity investment entities. The original term of the loan was for two years and ten months with three periodic principal payments required. After various amendments to the terms of the note, in December 2013 the parties agreed to delay all principal repayment until December 2016. As of June 30, 2015, and December 31, 2014, we included $1.7 million in “Related party notes receivable – long term” in our condensed consolidated balance sheets. JiYa also purchases raw materials from one of its equity investment entities for production in the ordinary course of business. As of June 30, 2015 and December 31, 2014, amounts payable of $2.0 million and $1.8 million, respectively, were included in “accounts payable” in our condensed consolidated balance sheets. JiYa also sells raw materials to one of its equity investment entities for production in the ordinary course of business Beginning in 2012, our consolidated joint venture, Nanjing Jin Mei Gallium Co., Ltd. (“Jin Mei”), is contractually obligated under an agency sales agreement to sell raw material on behalf of its equity investment entity. Jin Mei bills the customers and remits the receipts, net of its portions of sales commission, to this equity investment entity. For the three months ended June 30, 2015 and 2014, Jin Mei has recorded $0 and $10,000 income from agency sales, respectively, which were included in “other income (expense), net” in the consolidated statements of operations. For the six months ended June 30, 2015 and 2014, Jin Mei has recorded income from agency sales, respectively, which were included in “other income (expense), net” in the condensed consolidated statements of operations In March 2012, our wholly-owned subsidiary, Beijing Tongmei Xtal Technology Co., Ltd. (“Tongmei”), entered into an operating lease for the land it owns with our consolidated joint venture Beijing BoYu Semiconductor Vessel Craftwork Technology Co., Ltd. The lease agreement for the land of approximately 22,081 square feet commenced on January 1, 2012 for a term of 10 years with annual lease payments of $24,000 subject to a 5% increase at each third year anniversary. The annual lease payment is due by January 31 of each year. Tongmei has paid $121,000 on behalf of Donghai County Dongfang High Purity Electronic Materials Co., Ltd.(“Dongfang”), its equity investment entity, to purchase materials. In 2014, an agreement was signed between Tongmei and Dongfang to set the date of repayment on December 31, 2015. As of June 30, 2015, this balance was included in “Related party notes receivable – short term” in our condensed consolidated balance sheets. In April 2014, Tongmei loaned an additional of $49,000 to Dongfang. The loan bears interest at 6.15% per annum and the principal and interest totaling $53,000 as of June 30, 2015 is due on December 31, 2015. As of June 30, 2015, this balance, including both principal and interest, was included in “Related party notes receivable – short term” in our condensed consolidated balance sheets. Tongmei also purchases raw materials from Dongfang for production in the ordinary course of business. As of June 30, 2015 and December 31, 2014, amounts payable of $117,000 and $0, respectively, were included in “accounts payable” in our condensed consolidated balance sheets. Tongmei also purchases raw materials from one of our equity investment entities for production in the ordinary course of business. As of June 30, 2015 and December 31, 2014, amounts payable of $293,000 and $513,000, respectively, were included in “accounts payable” in our condensed consolidated balance sheets. Beijing Kaide Quartz Co. Ltd. (“Kaide”) has been a supplier of customized quartz tubes to the Company since 2004. Beijing XiangHeMing Trade Co. Ltd., (“XiangHeMing”) is a significant shareholder of Kaide. XiangHeMing was previously owned by, among others, certain immediate family members of Davis Zhang, our former President, China Operations, until at least sometime in 2004, at which time the official Chinese government records indicate that Mr. Zhang’s immediate family members transferred their ownership of XiangHeMing to a third party. However, we are currently unable to conclusively determine whether Mr. Zhang’s immediate family members retained any economic interest in XiangHeMing after the transfer. As of June 30, 2015 and December 31 2014, amounts payable of $116,000 and $730,000, respectively, were included in “accounts payable” in our condensed consolidated balance sheets. Our Related Party Transactions Policy seeks to prohibit all conflicts of interest in transactions between related parties and us, unless they have been approved by our Board of Directors. This policy applies to all of our employees and directors, our subsidiaries and our joint ventures. Our executive officers retain board seats on the board of directors of the companies in which we have invested in our China joint ventures. See Note 6 for further details.

Investments in Companies

Investments in Companies	6 Months Ended
	Jun. 30, 2015
Investments in Companies [Abstract]
Investments in Companies	Note 6. Investments in Companies We have made strategic investments in private companies located in China in order to gain access at a competitive cost to raw materials that are critical to our substrate business. These companies form part of our overall supply chain. The investments are summarized below (in thousands): Investment Balance as of Company June 30, 2015 December 31, 2014 Accounting Method Ownership Percentage Beijing JiYa Semiconductor Material Co., Ltd. $ 3,331 $ 3,331 Consolidated 46 % Nanjing Jin Mei Gallium Co., Ltd. 592 592 Consolidated 83 % Beijing BoYu Semiconductor Vessel Craftwork Technology Co., Ltd. 1,346 1,346 Consolidated 70 % $ 5,269 $ 5,269 Donghai County Dongfang High Purity Electronic Materials Co., Ltd. $ 1,652 $ 1,723 Equity 46 % Xilingol Tongli Germanium Co. Ltd. 5,556 5,351 Equity 25 % Emeishan Jia Mei High Purity Metals Co., Ltd. 1,043 1,021 Equity 25 % $ 8,251 $ 8,095 Our ownership of Beijing JiYa Semiconductor Material Co., Ltd. (“JiYa”) is 46%. We continue to consolidate JiYa as we have significant influence in management and have majority control of the board. Our Chief Executive Officer is chairman of the JiYa board and we have appointed one other representative to serve on the board. Our ownership of Nanjing Jin Mei Gallium Co., Ltd. (“Jin Mei”) is 83%. We continue to consolidate Jin Mei as we have significant influence in management and have majority control of the board. Our Chief Executive Officer is chairman of the Jin Mei board and we have appointed two other representatives to serve on the board. Our ownership of Beijing BoYu Semiconductor Vessel Craftwork Technology Co., Ltd (“BoYu”) is 70%. We continue to consolidate BoYu as we have a significant influence in management and have majority control of the board. Our Chief Executive Officer is chairman of the BoYu board and we have appointed two other representatives to serve on the board. Although we have representation on the boards of directors of each of these companies, the daily operations of each of these companies are managed by local management and not by us. Decisions concerning their respective short-term strategy and operations, any capacity expansion and annual capital expenditures, and decisions concerning sales of finished product, are made by local management with some inputs from us. During the three months ended June 30, 2015 and 2014, the three consolidated joint ventures generated $0.6 million and $1.1 million of income, respectively, of which $127,000 and $242,000, respectively, were allocated to minority interests, resulting in $520,000 and $847,000 of income, respectively, to our net income (loss). During the six months ended June 30, 2015 and 2014, the three consolidated joint ventures generated $1.2 million and $1.8 million of income, respectively, of which $252,000 and $447,000, respectively, were allocated to minority interests, resulting in $947,000 and $1.4 million of income, respectively, to our net income (loss). For the three minority investment entities that are not consolidated, the investment balances are included in “other assets” in our condensed consolidated balance sheets and totaled $8.3 million and $8.1 million as of June 30, 2015 and December 31, 2014. We own 46% of the ownership interests in one of these companies and 25% in each of the other two companies. These three companies are not considered variable interest entities because: · all three companies have sustainable businesses of their own; · our voting power is proportionate to our ownership interests; · we only recognize our respective share of the losses and/or residual returns generated by the companies if they occur; and · we do not have controlling financial interest in, do not maintain operational or management control of, do not control the board of directors of, and are not required to provide additional investment or financial support to any of these companies. We also maintain minority investments indirectly in privately-held companies through our consolidated joint ventures. These minority investments are accounted for under the equity method in the books of our consolidated joint ventures. As of June 30, 2015 and December 31, 2014, our consolidated joint ventures included these minority investments in “other assets” in the consolidated balance sheets with a carrying value of $4.4 million and $4.0 million, respectively. The minority investment entities that are not consolidated are accounted for under the equity method and had the following summarized income information (in thousands) for the three and six months ended June 30, 2015 and 2014. Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Net revenue $ 11,004 $ 13,466 $ 20,329 $ 26,946 Gross profit 3,625 8,124 5,920 12,087 Operating income 2,292 3,424 3,343 6,088 Net income 1,784 2,607 2,741 4,726 Our portion of the entity earnings from the minority investment entities that are not consolidated and are accounted for under the equity method were $410,000 and $625,000 for the three months ended June 30, 2015 and 2014, respectively, and $610,000 and $1.1 million for the six months ended June 30, 2015 and 2014, respectively. During the three months ended June 30, 2015, we re-classified our minority investments under the cost method as an available-for- sale security when we deemed that there was sufficient trading volume in the exchange for the stock to be deemed readily marketable. As of June 30, 2015, we no longer maintain any investments under the cost method. As of December 31, 2014, our investments in this unconsolidated company had a carrying value of $200,000 and were included in “other assets” in the condensed consolidated balance sheets.

Stockholders' Equity

Stockholders' Equity	6 Months Ended
	Jun. 30, 2015
Stockholders' Equity [Abstract]
Stockholders' Equity	Note 7. Stockholders’ Equity Consolidated Statement of Changes in Equity (in thousands) Preferred Stock Common Stock Additional Paid In Capital Accumulated Deficit Other Comprehensive Income/(loss) AXT, Inc. stockholders’ equity Noncontrolling interests Total stockholders’ equity Balance as of December 31, 2014 $ 3,532 $ 32 $ 195,419 $ (68,393 ) $ 7,673 $ 138,263 $ 6,425 $ 144,688 Common stock options exercised 76 76 76 Common stock repurchased (1,521 ) (1,521 ) (1,521 ) Stock-based compensation 740 740 740 Net (loss) income (1,027 ) (1,027 ) 252 (775 ) Dividends declared by joint ventures (83 ) (83 ) Change in unrealized (loss) gain on marketable securities (350 ) (350 ) (350 ) Currency translation adjustment 263 263 42 305 Balance as of June 30, 2015 $ 3,532 $ 32 $ 194,714 $ (69,420 ) $ 7,586 $ 136,444 $ 6,636 $ 143,080 There were no reclassification adjustments from accumulated other comprehensive income for the six months ended June 30, 2015 and 2014 . Stock Repurchase Program On February 21, 2013, our Board of Directors approved a stock repurchase program pursuant to which we may repurchase up to $6.0 million of our outstanding common stock through February 27, 2014. These purchases can be made from time to time in the open market and are funded from our existing cash balances and cash generated from operations. During 2013, we repurchased approximately 285,000 shares at an average price of $2.51 per share for a total purchase price of $716,000 under the stock repurchase program. As of December 31, 2013, approximately $5.3 million remained available for future repurchases under this program. No shares were repurchased in 2014 under this program and the plan expired on February 27, 2014. On October 27, 2014, our Board of Directors approved a stock repurchase program pursuant to which we may repurchase up to $5.0 million of our outstanding common stock. These repurchases can be made from time to time in the open market and are funded from our existing cash balances and cash generated from operations. During the three months ended June 30, 2015, we repurchased approximately 353,000 shares at an average price of $2.56 per share for a total purchase price of $904,000 under the stock repurchase program. During the six months ended June 30, 2015, we repurchased approximately 583,000 shares at an average price of $2.61 per share for a total purchase price of $1.5 million under the stock repurchase program. As of June 30, 2015, approximately $3.5 million remained available for future repurchases under this program. See Item 2, Unregistered Sales of Equity Securities and Use of Proceeds in Part II, Other Information, for additional information.

Stock-Based Compensation

Stock-Based Compensation	6 Months Ended
	Jun. 30, 2015
Stock-Based Compensation [Abstract]
Stock-Based Compensation	Note 8. Stock-Based Compensation We account for stock-based compensation in accordance with the provisions of FASB Accounting Standards Codification (“ASC”) topic 718, Compensation-Stock Compensation The following table summarizes compensation costs related to our stock-based awards (in thousands, except per share data): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Cost of revenue $ 5 $ 5 $ 10 $ 10 Selling, general and administrative 417 245 642 489 Research and development 44 47 88 90 Total stock-based compensation 466 297 740 589 Tax effect on stock-based compensation — — — — Net effect on net income (loss) $ 466 $ 297 $ 740 $ 589 As of June 30, 2015, the unamortized compensation costs related to unvested stock options granted to employees under our stock option plan was approximately $1.2 million, net of estimated forfeitures of $68,000. These costs will be amortized on a straight-line basis over a weighted-average period of approximately 2.5 years and will be adjusted for subsequent changes in estimated forfeitures. We elected not to capitalize any stock-based compensation to inventory as of June 30, 2015 due to the immateriality of the amount. We estimate the fair value of stock options using the Black-Scholes valuation model, consistent with the provisions of ASC 718. There were 20,000 and 52,000 options granted with weighted average grant date fair values of $0.48 and $1.10 in the three and six months ended June 30, 2015 and 2014, respectively. The fair value of our stock options granted to employees for the three and six months ended June 30, 2015 was estimated using the following weighted-average assumptions: Three Months Ended June 30, 2015 Six Months Ended June 30, 2015 Expected term (in years) 1.0 1.0 Volatility 54.21 % 54.21 % Expected dividend 0 % 0 % Risk-free interest rate 1.86 % 1.86 % The following table summarizes the stock option transactions during the six months ended June 30, 2015 (in thousands, except per share data): Stock Options Shares Weighted- average Exercise Price Weighted- average Remaining Contractual Life (in years) Aggregate Intrinsic Value Balance as of January 1, 2015 3,198 $ 3.12 6.95 $ 1,247 Granted 20 2.51 Exercised (54 ) 1.40 Canceled and expired (62 ) 3.86 Balance as of June 30, 2015 3,102 $ 3.13 5.54 $ 659 Options vested as of June 30, 2015 and unvested options expected to vest, net of forfeitures 3,102 $ 3.13 5.54 $ 659 Options exercisable as of June 30, 2015 1,998 $ 3.44 4.38 $ 547 The aggregate intrinsic value in the table above represents the total pretax intrinsic value, based on our closing price of $2.52 on June 30, 2015, which would have been received by the option holder had all option holders exercised their options on that date. Restricted stock awards A summary of activity related to restricted stock awards for the six months ended June 30, 2015 is presented below (in thousands, except per share data): Stock Awards Shares Weighted-Average Grant Date Fair Value Non-vested as of January 1, 2015 261 $ 2.71 Granted 336 $ 2.56 Vested (118 ) $ 2.65 Forfeited (13 ) $ 2.34 Non-vested as of June 30, 2015 466 $ 2.63 As of June 30, 2015, the unamortized compensation costs related to unvested restricted stock awards was approximately $1.1 million, which is to be amortized on a straight-line basis over a weighted average period of approximately 1.8 years.

Net Income (Loss) Per Share

Net Income (Loss) Per Share	6 Months Ended
	Jun. 30, 2015
Net Income (Loss) Per Share [Abstract]
Net Income (Loss) Per Share	Note 9. Net Income (Loss) Per Share Basic net income (loss) per share is computed using the weighted-average number of common shares outstanding during the periods less shares of common stock subject to repurchase and non-vested stock awards. Diluted net income (loss) per share is computed using the weighted-average number of common shares outstanding and potentially dilutive common shares outstanding during the periods. The dilutive effect of outstanding stock options and restricted stock awards is reflected in diluted earnings per share by application of the treasury stock method. Potentially dilutive common shares consist of common shares issuable upon the exercise of stock options. Potentially dilutive common shares are excluded in net loss periods, as their effect would be anti-dilutive. A reconciliation of the numerators and denominators of the basic and diluted net income (loss) per share calculations is as follows (in thousands, except per share data): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Numerator: Net income (loss) attributable to AXT, Inc. $ (3 ) $ 319 $ (1,027 ) $ (1,721 ) Less: Preferred stock dividends (44 ) (44 ) (88 ) (88 ) Net income (loss) available to common stockholders $ (47 ) $ 275 $ (1,115 ) $ (1,809 ) Denominator: Denominator for basic net income (loss) per share - weighted average common shares 32,242 32,381 32,399 32,407 Effect of dilutive securities: Common stock options — 195 — — Restricted stock awards — 22 — — Denominator for dilutive net income (loss) per common share 32,242 32,597 32,399 32,407 Net income (loss) attributable to AXT, Inc. per common share: Basic $ (0.00 ) $ 0.01 $ (0.03 ) $ (0.06 ) Diluted $ (0.00 ) $ 0.01 $ (0.03 ) $ (0.06 ) Options excluded from diluted net income (loss) per share as the impact is anti-dilutive 3,102 1,782 3,102 2,645 Restricted stock excluded from diluted net income (loss) per share as the impact is anti-dilutive 466 93 466 266 The 883,000 shares of $0.001 par value Series A preferred stock issued and outstanding as of June 30, 2015 and December 31, 2014, valued at $3,532,000, are non-voting and non-convertible preferred stock with a 5.0% cumulative annual dividend rate payable when declared by the board of directors and a $4 per share liquidation preference over common stock, which must be paid before any distribution is made to common stockholders. These preferred shares were issued to Lyte Optronics, Inc. stockholders in connection with the completion of our acquisition of Lyte Optronics, Inc. on May 28, 1999.

Segment Information and Foreign

Segment Information and Foreign Operations	6 Months Ended
	Jun. 30, 2015
Segment Information and Foreign Operations [Abstract]
Segment Information and Foreign Operations	Note 10. Segment Information and Foreign Operations Segment Information We operate in one segment for the design, development, manufacture and distribution of high-performance compound semiconductor substrates and sale of materials. In accordance with ASC topic 280, Segment Reporting, The following table represents revenue amounts (in thousands) reported for products shipped to customers in the corresponding geographic region: Three Months Ended June 30, Six Months Ended June 30 2015 2014 2015 2014 Geographical region: Europe (primarily Germany) $ 5,664 $ 4,968 $ 10,607 $ 11,551 China 3,561 4,960 6,858 9,125 Taiwan 3,414 2,785 6,523 4,900 North America (primarily the United States) 2,850 2,829 6,322 4,609 Asia Pacific (excluding China, Taiwan and Japan) 2,768 2,450 5,527 4,839 Japan 2,753 3,457 5,237 5,770 Total $ 21,010 $ 21,449 $ 41,074 $ 40,794 Long-lived assets consist primarily of property, plant and equipment, and are attributed to the geographic location in which they are located. Long-lived assets by geographic region were as follows (in thousands): As of June 30, 2015 December 31, 2014 Long-lived assets by geographic region: North America $ 1,114 $ 136 China 32,252 33,726 $ 33,366 $ 33,862 Significant Customers One customer represented more than 10% of our revenue for the three months ended June 30, 2015 while no customer represented more than 10% of our revenue for the three months ended June 30, 2014. No customer represented more than 10% of our revenue for the six months ended June 30, 2015 and 2014. Our top five customers, although not the same five customers for each period, represented 37% of our revenue for the three months ended June 30, 2015 and 2014. Our top five customers, although not the same five customers for each period, represented 36% and 35% of our revenue for the six months ended June 30, 2015 and 2014, respectively. We perform ongoing credit evaluations of our customers’ financial condition, and limit the amount of credit extended when deemed necessary, but generally do not require collateral. Two customers, although not the same two customers, accounted for 11% and 10% of our accounts receivable balance as of June 30, 2015 and December 31, 2014.

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2015
Commitments and Contingencies [Abstract]
Commitments and Contingencies	Note 11. Commitments and Contingencies Indemnification Agreements We have entered into indemnification agreements with our directors and officers that require us to indemnify our directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of a culpable nature; to advance their expenses incurred as a result of any proceeding against them as to which they could be indemnified; and to obtain directors’ and officers’ insurance if available on reasonable terms, which we currently have in place. Product Warranty We provide warranties for our products for a specific period of time, generally twelve months, against material defects. We provide for the estimated future costs of warranty obligations in cost of sales when the related revenue is recognized. The accrued warranty costs represent the best estimate at the time of sale of the total costs that we expect to incur to repair or replace product parts that fail while still under warranty. The amount of accrued estimated warranty costs are primarily based on historical experience as to product failures as well as current information on repair costs. On a quarterly basis, we review the accrued balances and update the historical warranty cost trends. The following table reflects the change in our warranty accrual which is included in “accrued liabilities” on the condensed consolidated balance sheets, during the three and six months ended June 30, 2015 and 2014 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Beginning accrued warranty and related costs $ 392 $ 1,227 $ 802 $ 1,048 Accruals for warranties issued 411 81 585 577 Adjustments related to pre-existing warranties including expirations and changes in estimates 42 (199 ) (252 ) (302 ) Cost of warranty repair (177 ) (129 ) (467 ) 343 Ending accrued warranty and related costs $ 668 $ 980 $ 668 $ 980 Contractual Obligations We lease certain office space, warehouse facilities and equipment under long-term operating leases expiring at various dates through December 2025. The majority of our lease obligations relates to our lease agreement for the facility in Fremont, California with approximately 19,467 square feet. We entered into a royalty agreement with a competitor effective December 3, 2010 with a term of eight years, terminating December 31, 2018. We and our related companies are granted a worldwide, nonexclusive, royalty bearing, irrevocable license to certain patents for the term on the agreement. We shall pay a total of $7.0 million of royalty payments over eight years that began in 2011 based on future royalty bearing sales. This agreement contains a clause that allows us to claim a credit, starting in 2013, in the event that the royalty bearing sales for the year are lower than a pre-determined amount set forth in this agreement. Outstanding contractual obligations as of June 30, 2015 are summarized as follows (in thousands): Payments due by period Contractual Obligations Total Less than 1 year 1-3 years 4-5 years More than 5 years Operating leases $ 639 $ 222 $ 258 $ 54 $ 105 Royalty agreement 2,125 688 1,150 287 — Total $ 2,764 $ 910 $ 1,408 $ 341 $ 105 Purchase Obligations with Penalties for Cancellation In the normal course of business, we issue purchase orders to various suppliers. In certain cases, we may incur a penalty if we cancel the purchase order. As of June 30, 2015, we do not have any outstanding purchase orders that will incur a penalty if cancelled by the Company. Legal Proceedings From time to time we may be involved in judicial or administrative proceedings concerning matters arising in the ordinary course of business. We do not expect that any of these matters, individually or in the aggregate, will have a material adverse effect on our business, financial condition, cash flows or results of operations.

Foreign Exchange Transaction Ga

Foreign Exchange Transaction Gains/Losses	6 Months Ended
	Jun. 30, 2015
Foreign Exchange Transaction Gains/Losses [Abstract]
Foreign Exchange Transaction Gains/Losses	Note 12. Foreign Exchange Transaction Gains/Losses We incurred foreign currency transaction exchange gains of $30,000 and $158,000 for the three months ended June 30, 2015 and 2014, respectively. We incurred foreign currency transaction exchange gains of $210,000 and $175,000 for the six months ended June 30, 2015 and 2014, respectively. These amounts are included in “other income (expense), net” on our condensed consolidated statements of operations.

Income Taxes

Income Taxes	6 Months Ended
	Jun. 30, 2015
Income Taxes [Abstract]
Income Taxes	Note 13. Income Taxes We account for income taxes in accordance with ASC topic 740, Income Taxes In accordance with Section 382 of the Internal Revenue Code, the amounts of and benefits from net operating loss and tax credit carryforwards may be impaired or limited in certain circumstances. Events which cause limitations in the amount of net operating losses or credits that we may utilize in any one year include, but are not limited to, a cumulative ownership change of more than 50% as defined, over a three year period. As a result of the implementation of Interpretation 48, we recognized $16.4 million of liability for unrecognized tax benefits. Of this amount, none was accounted for as a reduction to balance of retained earnings. The amount decreased tax loss carryforwards in the U.S., which are fully offset by a valuation allowance. We recognize interest and penalties related to uncertain tax positions in income tax expense. Income tax expense for the three month ended June 31, 2015 includes no interest and penalties. As of June 31, 2015, we have no accrued interest and penalties related to uncertain tax positions. We file income tax returns in the U.S. federal, various states and foreign jurisdictions. We have substantially concluded all U.S. federal and state income tax matters through December 31, 2013. Provision for income taxes for three and six months ended June 30, 2015 and 2014 was mostly related to our wholly owned China subsidiary and our three partially owned subsidiaries in China. We have made a tax election in China whereby certain minimum foreign withholding taxes are treated as an expense and not a tax credit. Besides the state taxes liabilities, no federal income tax benefit or expense has been provided for the three and six months ended June 30, 2015 and 2014 due to our net loss, our valuation allowance being utilized and uncertainty of future profits in the U.S.

Whistleblower Complaint and Inv

Whistleblower Complaint and Investigation	6 Months Ended
	Jun. 30, 2015
Whistleblower Complaint and Investigation [Abstract]
Whistleblower Complaint and Investigation	Note 14. Whistleblower Complaint and Investigation On February 23, 2015, the Board of Directors announced that, pursuant to an anonymous whistleblower complaint, our Audit Committee has conducted an investigation of certain potential related-party transactions involving Davis Zhang, our former President, China Operations. The investigation did not conclude that there was any intentional misconduct by Mr. Zhang, or that he received any improper benefit from these transactions. Further, the investigation did not reveal any inaccuracies in our financial statements resulting from these transactions. However, the investigation identified certain historical related-party transactions that were not previously disclosed in our filings with the Securities and Exchange Commission (“SEC”). We have filed a Current Report on Form 8-K with the SEC on February 23, 2015 to disclose such historical related-party transactions. On February 20, 2015, the Board waived any potential inconsistencies with our Code of Conduct and Ethics arising from the transactions identified in the investigation. Also, the Audit Committee approved the related-party nature of such transactions to the extent it had not previously approved such transactions. The Board and Audit Committee specified that such waiver and approval would have retroactive effect to the date of commencement of the transactions covered by such waiver and approval. We have incurred approximately $1.8 million of professional service fees during the course of this investigation.

Recent Accounting Pronouncement

Recent Accounting Pronouncements	6 Months Ended
	Jun. 30, 2015
Recent Accounting Pronouncements [Abstract]
Recent Accounting Pronouncements	Note 15. Recent Accounting Pronouncements In May 2014, as part of its ongoing efforts to assist in the convergence of U.S. GAAP and International Financial Reporting Standards (“IFRS”), FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” The new guidance sets forth a new five-step revenue recognition model which replaces the prior revenue recognition guidance in its entirety and is intended to eliminate numerous industry-specific pieces of revenue recognition guidance that have historically existed in U.S. GAAP. The underlying principle of the new standard is that a business or other organization will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects what it expects in exchange for the goods or services. The standard also requires more detailed disclosures and provides additional guidance for transactions that were not addressed completely in the prior accounting guidance. The ASU provides alternative methods of initial adoption and is effective for annual and interim periods beginning after December 15, 2016. We are currently evaluating the impact that this standard will have on our consolidated financial statements.

Investments and Fair Value Me23

Investments and Fair Value Measurements (Tables)	6 Months Ended
	Jun. 30, 2015
Investments and Fair Value Measurements [Abstract]
Cash, cash equivalents and investments	As of June 30, 2015 and December 31, 2014, our cash, cash equivalents and investments are classified as follows (in thousands): June 30, 2015 December 31, 2014 Amortized Cost Gross Unrealized Gain Gross Unrealized (Loss) Fair Value Amortized Cost Gross Unrealized Gain Gross Unrealized (Loss) Fair Value Classified as: Cash $ 17,337 $ — $ — $ 17,337 $ 22,337 $ — $ — $ 22,337 Cash equivalents: Certificates of deposit 1 11,303 — — 11,303 6,454 — — 6,454 Money market fund — — — — 23 — — 23 Total cash and cash equivalents 28,640 — — 28,640 28,814 — — 28,814 Investments (available for sale): Certificates of deposit 2 8,105 1 (16 ) 8,090 10,195 1 (13 ) 10,183 Corporate bonds 9,006 — (40 ) 8,966 9,214 1 (29 ) 9,186 Corporate equity securities 200 375 — 575 44 710 — 754 Total investments 17,311 376 (56 ) 17,631 19,453 712 (42 ) 20,123 Total cash, cash equivalents and investments $ 45,951 $ 376 $ (56 ) $ 46,271 $ 48,267 $ 712 $ (42 ) $ 48,937 Contractual maturities on investments: Due within 1 year $ 3,560 $ 3,932 $ 11,631 $ 12,340 Due after 1 through 5 years 13,751 13,699 7,822 7,783 $ 17,311 17,631 $ 19,453 $ 20,123 1. Certificate of deposit with original maturities of less than 90 days. 2. Certificate of deposit with original maturities of more than 90 days
Fair value and gross unrealized losses related to available-for-sale securities	The following table summarizes the fair value and gross unrealized losses related to available-for-sale securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of June 30, 2015 (in thousands): As of June 30, 2015 In Loss Position < 12 months In Loss Position > 12 months Total In Loss Position Fair Value Gross Unrealized (Losses) Fair Value Gross Unrealized (Losses) Fair Value Gross Unrealized (Losses) Investments: Certificates of deposit $ 6,410 $ (15 ) $ 1,199 $ (1 ) $ 7,609 $ (16 ) Corporate bonds 8,966 (40 ) — — 8,966 (40 ) Total in loss position $ 15,376 $ (55 ) $ 1,199 $ (1 ) $ 16,575 $ (56 ) The following table summarizes the fair value and gross unrealized losses related to available-for-sale securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2014 (in thousands): As of December 31, 2014 In Loss Position < 12 months In Loss Position > 12 months Total In Loss Position Fair Value Gross Unrealized (Loss) Fair Value Gross Unrealized (Loss) Fair Value Gross Unrealized (Loss) Investments: Certificates of deposit $ 4,492 $ (13 ) $ — $ — $ 4,492 $ (13 ) Corporate bonds 3,770 (27 ) 4,309 (2 ) 8,079 (29 ) Total in loss position $ 8,262 $ (40 ) $ 4,309 $ (2 ) $ 12,571 $ (42 )
Summary of financial assets and liabilities measured at fair value on a recurring basis	The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis in accordance with ASC 820 as of June 30, 2015 (in thousands): Balance as of June 30, 2015 Quoted Prices in Active Markets of Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents and investments: Certificates of deposit $ 19,393 $ — $ 19,393 $ — Corporate bonds 8,966 — 8,966 — Corporate equity securities 575 575 — — Total $ 28,934 $ 575 $ 28,359 $ — Liabilities: Foreign currency hedge obligations $ 29 $ — $ — $ 29 The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis in accordance with ASC 820 as of December 31, 2014 (in thousands): Balance as of December 31, 2014 Quoted Prices in Active Markets of Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents and investments: Money market fund $ 23 $ 23 $ — $ — Certificates of deposit 10,183 — 10,183 — Corporate bonds 9,186 — 9,186 — Corporate equity securities 754 754 — — Total $ 20,146 $ 777 $ 19,369 $ — Liabilities $ — $ — $ — $ —

Inventories (Tables)

Inventories (Tables)	6 Months Ended
	Jun. 30, 2015
Inventories [Abstract]
Components of inventories	The components of inventories are summarized below (in thousands): June 30, 2015 December 31, 2014 Inventories: Raw materials $ 20,549 $ 18,990 Work in process 15,847 16,222 Finished goods 2,505 3,362 $ 38,901 $ 38,574

Accrued Liabilities (Tables)

Accrued Liabilities (Tables)	6 Months Ended
	Jun. 30, 2015
Accrued Liabilities [Abstract]
Components of accrued liabilities	The components of accrued liabilities are summarized below (in thousands): June 30, 2015 December 31, 2014 Accrued compensation and related charges $ 1,694 $ 2,656 Current portion of royalty payments 688 800 Accrued product warranty 668 802 Accrued professional services 418 509 Dividends payable by consolidated joint ventures 566 563 Accrued income taxes 279 119 Other accrued liabilities 1,730 2,185 $ 6,043 $ 7,634

Investments in Companies (Table

Investments in Companies (Tables)	6 Months Ended
	Jun. 30, 2015
Investments in Companies [Abstract]
Investments	The investments are summarized below (in thousands): Investment Balance as of Company June 30, 2015 December 31, 2014 Accounting Method Ownership Percentage Beijing JiYa Semiconductor Material Co., Ltd. $ 3,331 $ 3,331 Consolidated 46 % Nanjing Jin Mei Gallium Co., Ltd. 592 592 Consolidated 83 % Beijing BoYu Semiconductor Vessel Craftwork Technology Co., Ltd. 1,346 1,346 Consolidated 70 % $ 5,269 $ 5,269 Donghai County Dongfang High Purity Electronic Materials Co., Ltd. $ 1,652 $ 1,723 Equity 46 % Xilingol Tongli Germanium Co. Ltd. 5,556 5,351 Equity 25 % Emeishan Jia Mei High Purity Metals Co., Ltd. 1,043 1,021 Equity 25 % $ 8,251 $ 8,095
Summarized income information	The minority investment entities that are not consolidated are accounted for under the equity method and had the following summarized income information (in thousands) for the three and six months ended June 30, 2015 and 2014. Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Net revenue $ 11,004 $ 13,466 $ 20,329 $ 26,946 Gross profit 3,625 8,124 5,920 12,087 Operating income 2,292 3,424 3,343 6,088 Net income 1,784 2,607 2,741 4,726

Stockholders' Equity (Tables)

Stockholders' Equity (Tables)	6 Months Ended
	Jun. 30, 2015
Stockholders' Equity [Abstract]
Consolidated statement of changes in equity	Consolidated Statement of Changes in Equity (in thousands) Preferred Stock Common Stock Additional Paid In Capital Accumulated Deficit Other Comprehensive Income/(loss) AXT, Inc. stockholders’ equity Noncontrolling interests Total stockholders’ equity Balance as of December 31, 2014 $ 3,532 $ 32 $ 195,419 $ (68,393 ) $ 7,673 $ 138,263 $ 6,425 $ 144,688 Common stock options exercised 76 76 76 Common stock repurchased (1,521 ) (1,521 ) (1,521 ) Stock-based compensation 740 740 740 Net (loss) income (1,027 ) (1,027 ) 252 (775 ) Dividends declared by joint ventures (83 ) (83 ) Change in unrealized (loss) gain on marketable securities (350 ) (350 ) (350 ) Currency translation adjustment 263 263 42 305 Balance as of June 30, 2015 $ 3,532 $ 32 $ 194,714 $ (69,420 ) $ 7,586 $ 136,444 $ 6,636 $ 143,080

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	6 Months Ended
	Jun. 30, 2015
Stock-Based Compensation [Abstract]
Compensation costs related to stock-based awards	The following table summarizes compensation costs related to our stock-based awards (in thousands, except per share data): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Cost of revenue $ 5 $ 5 $ 10 $ 10 Selling, general and administrative 417 245 642 489 Research and development 44 47 88 90 Total stock-based compensation 466 297 740 589 Tax effect on stock-based compensation — — — — Net effect on net income (loss) $ 466 $ 297 $ 740 $ 589
Weighted-average assumptions	The fair value of our stock options granted to employees for the three and six months ended June 30, 2015 was estimated using the following weighted-average assumptions: Three Months Ended June 30, 2015 Six Months Ended June 30, 2015 Expected term (in years) 1.0 1.0 Volatility 54.21 % 54.21 % Expected dividend 0 % 0 % Risk-free interest rate 1.86 % 1.86 %
Summary of stock option activity	The following table summarizes the stock option transactions during the six months ended June 30, 2015 (in thousands, except per share data): Stock Options Shares Weighted- average Exercise Price Weighted- average Remaining Contractual Life (in years) Aggregate Intrinsic Value Balance as of January 1, 2015 3,198 $ 3.12 6.95 $ 1,247 Granted 20 2.51 Exercised (54 ) 1.40 Canceled and expired (62 ) 3.86 Balance as of June 30, 2015 3,102 $ 3.13 5.54 $ 659 Options vested as of June 30, 2015 and unvested options expected to vest, net of forfeitures 3,102 $ 3.13 5.54 $ 659 Options exercisable as of June 30, 2015 1,998 $ 3.44 4.38 $ 547
Restricted stock awards	A summary of activity related to restricted stock awards for the six months ended June 30, 2015 is presented below (in thousands, except per share data): Stock Awards Shares Weighted-Average Grant Date Fair Value Non-vested as of January 1, 2015 261 $ 2.71 Granted 336 $ 2.56 Vested (118 ) $ 2.65 Forfeited (13 ) $ 2.34 Non-vested as of June 30, 2015 466 $ 2.63

Net Income (Loss) Per Share (Ta

Net Income (Loss) Per Share (Tables)	6 Months Ended
	Jun. 30, 2015
Net Income (Loss) Per Share [Abstract]
Reconciliation of numerators and denominators of basic and diluted net income (loss) per share	A reconciliation of the numerators and denominators of the basic and diluted net income (loss) per share calculations is as follows (in thousands, except per share data): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Numerator: Net income (loss) attributable to AXT, Inc. $ (3 ) $ 319 $ (1,027 ) $ (1,721 ) Less: Preferred stock dividends (44 ) (44 ) (88 ) (88 ) Net income (loss) available to common stockholders $ (47 ) $ 275 $ (1,115 ) $ (1,809 ) Denominator: Denominator for basic net income (loss) per share - weighted average common shares 32,242 32,381 32,399 32,407 Effect of dilutive securities: Common stock options — 195 — — Restricted stock awards — 22 — — Denominator for dilutive net income (loss) per common share 32,242 32,597 32,399 32,407 Net income (loss) attributable to AXT, Inc. per common share: Basic $ (0.00 ) $ 0.01 $ (0.03 ) $ (0.06 ) Diluted $ (0.00 ) $ 0.01 $ (0.03 ) $ (0.06 ) Options excluded from diluted net income (loss) per share as the impact is anti-dilutive 3,102 1,782 3,102 2,645 Restricted stock excluded from diluted net income (loss) per share as the impact is anti-dilutive 466 93 466 266

Segment Information and Forei30

Segment Information and Foreign Operations (Tables)	6 Months Ended
	Jun. 30, 2015
Segment Information and Foreign Operations [Abstract]
Revenue reported for products shipped to customers in the corresponding geographic region	The following table represents revenue amounts (in thousands) reported for products shipped to customers in the corresponding geographic region: Three Months Ended June 30, Six Months Ended June 30 2015 2014 2015 2014 Geographical region: Europe (primarily Germany) $ 5,664 $ 4,968 $ 10,607 $ 11,551 China 3,561 4,960 6,858 9,125 Taiwan 3,414 2,785 6,523 4,900 North America (primarily the United States) 2,850 2,829 6,322 4,609 Asia Pacific (excluding China, Taiwan and Japan) 2,768 2,450 5,527 4,839 Japan 2,753 3,457 5,237 5,770 Total $ 21,010 $ 21,449 $ 41,074 $ 40,794
Long-lived assets by geographic region	Long-lived assets consist primarily of property, plant and equipment, and are attributed to the geographic location in which they are located. Long-lived assets by geographic region were as follows (in thousands): As of June 30, 2015 December 31, 2014 Long-lived assets by geographic region: North America $ 1,114 $ 136 China 32,252 33,726 $ 33,366 $ 33,862

Commitments and Contingencies (

Commitments and Contingencies (Tables)	6 Months Ended
	Jun. 30, 2015
Commitments and Contingencies [Abstract]
Product warranty accrued liability	The following table reflects the change in our warranty accrual which is included in “accrued liabilities” on the condensed consolidated balance sheets, during the three and six months ended June 30, 2015 and 2014 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Beginning accrued warranty and related costs $ 392 $ 1,227 $ 802 $ 1,048 Accruals for warranties issued 411 81 585 577 Adjustments related to pre-existing warranties including expirations and changes in estimates 42 (199 ) (252 ) (302 ) Cost of warranty repair (177 ) (129 ) (467 ) 343 Ending accrued warranty and related costs $ 668 $ 980 $ 668 $ 980
Outstanding contractual obligations	Outstanding contractual obligations as of June 30, 2015 are summarized as follows (in thousands): Payments due by period Contractual Obligations Total Less than 1 year 1-3 years 4-5 years More than 5 years Operating leases $ 639 $ 222 $ 258 $ 54 $ 105 Royalty agreement 2,125 688 1,150 287 — Total $ 2,764 $ 910 $ 1,408 $ 341 $ 105

Basis of Presentation (Details)

Basis of Presentation (Details) - Majority-Owned Subsidiaries [Member]	Jun. 30, 2015
Minimum [Member]
Schedule of Equity Method Investments [Line Items]
Percentage of ownership, equity method (in hundredths)	20.00%
Maximum [Member]
Schedule of Equity Method Investments [Line Items]
Percentage of ownership, equity method (in hundredths)	50.00%

Investments and Fair Value Me33

Investments and Fair Value Measurements (Details) - USD ($)		3 Months Ended		6 Months Ended		12 Months Ended
		Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014	Dec. 31, 2013
Cash, cash equivalents and investments [Abstract]
Cash		$ 17,337,000		$ 17,337,000		$ 22,337,000
Cash equivalents [Abstract]
Certificates of deposit, amortized cost	[1]	11,303,000		11,303,000		6,454,000
Certificates of deposit, gross unrealized gain	[1]			0		0
Certificates of deposit, gross unrealized loss	[1]			0		0
Certificates of deposit, fair value	[1]	11,303,000		11,303,000		6,454,000
Money market fund		0		0		23,000
Total cash and cash equivalents		28,640,000	$ 26,307,000	28,640,000	$ 26,307,000	28,814,000	$ 24,961,000
Amortized Cost		45,951,000		45,951,000		48,267,000
Gross Unrealized Gain		376,000		376,000		712,000
Gross Unrealized (Loss)		(56,000)		(56,000)		(42,000)
Fair Value		46,271,000		46,271,000		48,937,000
Contractual maturities on investments, amortized cost basis [Abstract]
Due within 1 year		3,560,000		3,560,000		11,631,000
Due after 1 through 5 years		13,751,000		13,751,000		7,822,000
Investments, amortized cost		17,311,000		17,311,000		19,453,000
Contractual maturities on investments, fair value basis [Abstract]
Due within 1 year		3,932,000		3,932,000		12,340,000
Due after 1 through 5 years		13,699,000		13,699,000		7,783,000
Investments, fair value		17,631,000		17,631,000		20,123,000
Proceeds from sales of available-for-sale investments		515,000	346,000	902,000	346,000
Available-for-sale investments, expenses		23,000	22,000	43,000	22,000
Gross realized gains from sales of available-for-sale investments		492,000	$ 324,000	859,000	$ 324,000
Unrealized gain, net of tax				375,000
Summary of fair value and gross unrealized losses related to available-for-sale securities [Abstract]
Fair value, in loss position less than twelve months		15,376,000		15,376,000		8,262,000
Gross unrealized loss, in loss position less than twelve months				(55,000)		(40,000)
Fair value, in loss position greater than twelve months		1,199,000		1,199,000		4,309,000
Gross unrealized loss, in loss position greater than twelve months				(1,000)		(2,000)
Fair value, total in loss position		16,575,000		16,575,000		12,571,000
Gross unrealized loss, total in loss position				(56,000)		(42,000)
Minority Investments [Abstract]
Minority investments in unconsolidated privately-held companies						200,000
Other Assets [Member]
Minority Investments [Abstract]
Investments in privately-held companies		12,600,000		12,600,000		12,100,000
Minority investments in unconsolidated privately-held companies						200,000
Certificates of Deposit [Member]
Cash equivalents [Abstract]
Amortized Cost	[2]	8,105,000		8,105,000		10,195,000
Gross Unrealized Gain	[2]	1,000		1,000		1,000
Gross Unrealized (Loss)	[2]	(16,000)		(16,000)		(13,000)
Fair Value	[2]	8,090,000		8,090,000		10,183,000
Summary of fair value and gross unrealized losses related to available-for-sale securities [Abstract]
Fair value, in loss position less than twelve months		6,410,000		6,410,000		4,492,000
Gross unrealized loss, in loss position less than twelve months				(15,000)		(13,000)
Fair value, in loss position greater than twelve months		1,199,000		1,199,000		0
Gross unrealized loss, in loss position greater than twelve months				(1,000)		0
Fair value, total in loss position		7,609,000		7,609,000		4,492,000
Gross unrealized loss, total in loss position				(16,000)		(13,000)
Corporate Bonds [Member]
Cash equivalents [Abstract]
Amortized Cost		9,006,000		9,006,000		9,214,000
Gross Unrealized Gain		0		0		1,000
Gross Unrealized (Loss)		(40,000)		(40,000)		(29,000)
Fair Value		8,966,000		8,966,000		9,186,000
Summary of fair value and gross unrealized losses related to available-for-sale securities [Abstract]
Fair value, in loss position less than twelve months		8,966,000		8,966,000		3,770,000
Gross unrealized loss, in loss position less than twelve months				(40,000)		(27,000)
Fair value, in loss position greater than twelve months		0		0		4,309,000
Gross unrealized loss, in loss position greater than twelve months				0		(2,000)
Fair value, total in loss position		8,966,000		8,966,000		8,079,000
Gross unrealized loss, total in loss position				(40,000)		(29,000)
Corporate Equity Securities [Member]
Cash equivalents [Abstract]
Amortized Cost		200,000		200,000		44,000
Gross Unrealized Gain		375,000		375,000		710,000
Gross Unrealized (Loss)		0		0		0
Fair Value		575,000		575,000		754,000
Total Investments [Member]
Cash equivalents [Abstract]
Amortized Cost		17,311,000		17,311,000		19,453,000
Gross Unrealized Gain		376,000		376,000		712,000
Gross Unrealized (Loss)		(56,000)		(56,000)		(42,000)
Fair Value		$ 17,631,000		$ 17,631,000		$ 20,123,000
[1]	Certificate of deposit with original maturities of less than 90 days.
[2]	Certificate of deposit with original maturities of more than 90 days.

Investments and Fair Value Me34

Investments and Fair Value Measurements, Fair Value (Details) - USD ($) $ in Thousands		Jun. 30, 2015	Dec. 31, 2014
Cash Equivalents and Investments [Abstract]
Money market fund		$ 0	$ 23
Certificates of deposit	[1]	11,303	6,454
Recurring [Member]
Cash Equivalents and Investments [Abstract]
Money market fund			23
Certificates of deposit		19,393	10,183
Corporate bonds		8,966	9,186
Corporate equity securities		575	754
Total		28,934	20,146
Liabilities [Abstract]
Liabilities			0
Foreign currency hedge obligations		29
Recurring [Member] | Quoted Prices in Active Markets of Identical Assets (Level 1) [Member]
Cash Equivalents and Investments [Abstract]
Money market fund			23
Certificates of deposit		0	0
Corporate bonds		0	0
Corporate equity securities		575	754
Total		575	777
Liabilities [Abstract]
Liabilities			0
Foreign currency hedge obligations		0
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member]
Cash Equivalents and Investments [Abstract]
Money market fund			0
Certificates of deposit		19,393	10,183
Corporate bonds		8,966	9,186
Corporate equity securities		0	0
Total		28,359	19,369
Liabilities [Abstract]
Liabilities			0
Foreign currency hedge obligations		0
Recurring [Member] | Significant Other Observable Inputs (Level 3) [Member]
Cash Equivalents and Investments [Abstract]
Money market fund			0
Certificates of deposit		0	0
Corporate bonds		0	0
Corporate equity securities		0	0
Total		0	0
Liabilities [Abstract]
Liabilities			$ 0
Foreign currency hedge obligations		$ 29
[1]	Certificate of deposit with original maturities of less than 90 days.

Inventories (Details)

Inventories (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Inventories [Abstract]
Raw materials	$ 20,549	$ 18,990
Work in process	15,847	16,222
Finished goods	2,505	3,362
Inventories, total	38,901	38,574
Inventory reserve	$ 11,400	$ 11,200

Accrued Liabilities (Details)

Accrued Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014	Jun. 30, 2014
Components of accrued liabilities [Abstract]
Accrued compensation and related charges	$ 1,694	$ 2,656
Current portion of royalty payments	688	800
Accrued product warranty	668	802
Accrued professional services	418	509
Dividends payable by consolidated joint ventures	566	563	$ 647
Accrued income taxes	279	119
Other accrued liabilities	1,730	2,185
Accrued liabilities, total	$ 6,043	$ 7,634

Related Party Transactions (Det

Related Party Transactions (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2015USD ($)ft²Installment	Jun. 30, 2014USD ($)	Jun. 30, 2015USD ($)ft²Installment	Jun. 30, 2014USD ($)	Dec. 31, 2014USD ($)	Aug. 31, 2011USD ($)EquityMethodInvestee
Related Party Transaction [Line Items]
Related party notes receivable - long term	$ 1,711,000		$ 1,711,000		$ 1,704,000
Accounts payable	7,323,000		7,323,000		7,137,000
Accounts receivable	$ 19,312,000		$ 19,312,000		17,864,000
Area of leased property (in square feet) | ft²	19,467		19,467
Principal and interest on loan	$ 174,000		$ 174,000		171,000
Beijing JiYa Semiconductor Material Co Ltd [Member]
Related Party Transaction [Line Items]
Amount of loan under note agreement						$ 1,700,000
Number of equity method investees to whom loan was granted | EquityMethodInvestee						1
Term of loan			2 years 10 months
Number of installments | Installment	3		3
Maturity date			Dec. 31, 2016
Related party notes receivable - long term	$ 1,700,000		$ 1,700,000		1,700,000
Accounts payable	2,000,000		2,000,000		1,800,000
Accounts receivable	518,000		518,000		350,000
Income from agency sales	0	$ 10,000	1,000	$ 16,000
Beijing Tongmei Xtal Technology [Member]
Related Party Transaction [Line Items]
Accounts payable	$ 293,000		$ 293,000		513,000
Area of leased property (in square feet) | ft²	22,081		22,081
Lease term			10 years
Annual lease payment			$ 24,000
Increase in annual lease payment at each third year anniversary (in hundredths)	5.00%		5.00%
Payments to purchase materials			$ 121,000
Additional loan paid to related party			$ 49,000
Interest on loan (in hundredths)	6.15%		6.15%
Principal and interest on loan	$ 53,000		$ 53,000
Beijing Tongmei Xtal Technology [Member] | Donghai County Dongfang High Purity Electronic Materials Co., Ltd [Member]
Related Party Transaction [Line Items]
Accounts payable	117,000		117,000		0
Beijing Kaide Quartz Co. Ltd [Member]
Related Party Transaction [Line Items]
Accounts payable	$ 116,000		$ 116,000		$ 730,000

Investments in Companies (Detai

Investments in Companies (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2015USD ($)EquityMethodInvesteeJointVenture	Jun. 30, 2014USD ($)JointVenture	Jun. 30, 2015USD ($)EquityMethodInvesteeJointVenture	Jun. 30, 2014USD ($)JointVenture	Dec. 31, 2014USD ($)EquityMethodInvestee
Summary of investments [Abstract]
Income allocated to minority interests	$ 127,000	$ 242,000	$ 252,000	$ 447,000
Equity investments classified as other assets	15,000,000		15,000,000		$ 14,975,000
Investments in unconsolidated privately-held entities, included in other assets					200,000
AXT, Inc. [Member]
Summary of investments [Abstract]
Gross equity earnings from minority-owned joint ventures that are not consolidated, recorded as other income	1,784,000	2,607,000	2,741,000	4,726,000
Equity Method Investments [Member]
Summary of investments [Abstract]
Equity method investment by parent	$ 8,251,000		$ 8,251,000		$ 8,095,000
Number of equity investment entities | EquityMethodInvestee	3		3		3
Equity investments classified as other assets	$ 8,300,000		$ 8,300,000		$ 8,100,000
Gross equity earnings from minority-owned joint ventures that are not consolidated, recorded as other income	$ 410,000	$ 625,000	$ 610,000	$ 1,100,000
Joint Ventures [Member]
Summary of investments [Abstract]
Number of consolidated joint ventures | JointVenture	3	3	3	3
Income from three consolidated joint ventures	$ 600,000	$ 1,100,000	$ 1,200,000	$ 1,800,000
Income allocated to minority interests	127,000	242,000	252,000	447,000
Net income from joint ventures attributable to parent	520,000	$ 847,000	947,000	$ 1,400,000
Minority investment in consolidated joint venture, included in other assets	4,400,000		4,400,000		4,000,000
Majority-Owned Subsidiaries [Member]
Summary of investments [Abstract]
Investments, consolidated	5,269,000		5,269,000		5,269,000
Beijing JiYa Semiconductor Material Co., Ltd [Member] | Majority-Owned Subsidiaries [Member]
Summary of investments [Abstract]
Investments, consolidated	3,331,000		$ 3,331,000		3,331,000
Percentage of ownership, consolidated method (in hundredths)			46.00%
Nanjing Jin Mei Gallium Co., Ltd [Member] | Majority-Owned Subsidiaries [Member]
Summary of investments [Abstract]
Investments, consolidated	592,000		$ 592,000		592,000
Percentage of ownership, consolidated method (in hundredths)			83.00%
Beijing BoYu Semiconductor Vessel Craftwork Technology Co., Ltd [Member] | Majority-Owned Subsidiaries [Member]
Summary of investments [Abstract]
Investments, consolidated	1,346,000		$ 1,346,000		1,346,000
Percentage of ownership, consolidated method (in hundredths)			70.00%
Donghai County Dongfang High Purity Electronic Materials Co., Ltd [Member] | Equity Method Investments [Member]
Summary of investments [Abstract]
Equity method investment by parent	$ 1,652,000		$ 1,652,000		1,723,000
Percentage of ownership, equity method (in hundredths)	46.00%		46.00%
Xilingol Tongli Germanium Co. Ltd [Member] | Equity Method Investments [Member]
Summary of investments [Abstract]
Equity method investment by parent	$ 5,556,000		$ 5,556,000		5,351,000
Percentage of ownership, equity method (in hundredths)	25.00%		25.00%
Emeishan Jia Mei High Purity Metals Co., Ltd [Member] | Equity Method Investments [Member]
Summary of investments [Abstract]
Equity method investment by parent	$ 1,043,000		$ 1,043,000		$ 1,021,000
Percentage of ownership, equity method (in hundredths)	25.00%		25.00%

Investments in Companies, Minor

Investments in Companies, Minority Investment Entities (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
AXT, Inc. [Member]
Summarized income information of all the minority investment entities that are not consolidated and accounted for under the equity method [Abstract]
Net revenue	$ 11,004,000	$ 13,466,000	$ 20,329,000	$ 26,946,000
Gross profit	3,625,000	8,124,000	5,920,000	12,087,000
Operating income	2,292,000	3,424,000	3,343,000	6,088,000
Net income	1,784,000	2,607,000	2,741,000	4,726,000
Equity Method Investments [Member]
Summarized income information of all the minority investment entities that are not consolidated and accounted for under the equity method [Abstract]
Net income	$ 410,000	$ 625,000	$ 610,000	$ 1,100,000

Stockholders' Equity (Details)

Stockholders' Equity (Details) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2013	Dec. 01, 2013
Preferred Stock [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance, beginning of period			$ 3,532,000
Balance, end of period	$ 3,532,000		3,532,000
Common Stock [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance, beginning of period			32,000
Balance, end of period	32,000		32,000
Additional Paid In Capital [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance, beginning of period			195,419,000
Common stock options exercised			76,000
Common stock repurchased			(1,521,000)
Stock-based compensation			740,000
Balance, end of period	194,714,000		194,714,000
Accumulated Deficit [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance, beginning of period			(68,393,000)
Net (loss) income			(1,027,000)
Balance, end of period	(69,420,000)		(69,420,000)
Other Comprehensive Income/(Loss) [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance, beginning of period			7,673,000
Change in unrealized (loss) gain on marketable securities			(350,000)
Currency translation adjustment			263,000
Balance, end of period	7,586,000		7,586,000
AXT, Inc. Stockholders' Equity [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance, beginning of period			138,263,000
Common stock options exercised			76,000
Common stock repurchased			(1,521,000)
Stock-based compensation			740,000
Net (loss) income			(1,027,000)
Change in unrealized (loss) gain on marketable securities			(350,000)
Currency translation adjustment			263,000
Balance, end of period	136,444,000		136,444,000
Noncontrolling Interests [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance, beginning of period			6,425,000
Net (loss) income			252,000
Dividends declared by joint ventures			(83,000)
Currency translation adjustment			42,000
Balance, end of period	6,636,000		6,636,000
Balance, beginning of period			144,688,000
Common stock options exercised			76,000
Common stock repurchased			(1,521,000)
Stock-based compensation			740,000
Net (loss) income	124,000	$ 561,000	(775,000)	$ (1,274,000)
Dividends declared by joint ventures			(83,000)
Change in unrealized (loss) gain on marketable securities	(91,000)	$ 149,000	(350,000)	$ 139,000
Currency translation adjustment			305,000
Balance, end of period	143,080,000		143,080,000
Stock Repurchase Program [Abstract]
Stock repurchase program, authorized amount	$ 5,000,000		$ 5,000,000			$ 6,000,000
Shares repurchased (in shares)	353,000		583,000		285,000
Average price of shares repurchased (in dollars per share)	$ 2.56		$ 2.61		$ 2.51
Total purchase price	$ 904,000		$ 1,500,000		$ 716,000
Stock repurchase program remaining authorized repurchase amount	$ 3,500,000		$ 3,500,000		$ 5,300,000

Stock-Based Compensation (Detai

Stock-Based Compensation (Details) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Stock-based compensation in the form of employee stock options and restricted stock [Abstract]
Total stock-based compensation	$ 466,000	$ 297,000	$ 740,000	$ 589,000
Tax effect on stock-based compensation	0	0	0	0
Net effect on net income (loss)	466,000	297,000	740,000	589,000
Cost of Revenue [Member]
Stock-based compensation in the form of employee stock options and restricted stock [Abstract]
Total stock-based compensation	5,000	5,000	10,000	10,000
Selling, General and Administrative [Member]
Stock-based compensation in the form of employee stock options and restricted stock [Abstract]
Total stock-based compensation	417,000	245,000	642,000	489,000
Research and Development [Member]
Stock-based compensation in the form of employee stock options and restricted stock [Abstract]
Total stock-based compensation	44,000	$ 47,000	88,000	$ 90,000
Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation costs related to unvested stock options not yet recognized	$ 1,200,000		1,200,000
Value of estimated forfeitures			$ 68,000
Weighted-average period of amortization			2 years 6 months
Weighted-average grant date fair value of stock options granted (in dollars per share)	$ 0.48	$ 1.10	$ 0.48	$ 1.10
Weighted average assumptions [Abstract]
Expected term	1 year		1 year
Volatility (in hundredths)	54.21%		54.21%
Expected dividend (in hundredths)	0.00%		0.00%
Risk-free interest rate (in hundredths)	1.86%		1.86%
Number of options outstanding [Roll Forward]
Options outstanding, beginning of period (in shares)			3,198,000
Granted (in shares)	20,000	52,000	20,000	52,000
Exercised (in shares)			(54,000)
Canceled and expired (in shares)			(62,000)
Options outstanding, end of period (in shares)	3,102,000		3,102,000		3,198,000
Options vested and unvested options expected to vest, net of forfeitures, end of period (in shares)	3,102,000		3,102,000
Options exercisable, end of period (in shares)	1,998,000		1,998,000
Weighted average exercise price [Roll Forward]
Options outstanding, beginning of period (in dollars per share)			$ 3.12
Granted (in dollars per share)			2.51
Exercised (in dollars per share)			1.40
Canceled and expired (in dollars per share)			3.86
Options outstanding, end of period (in dollars per share)	$ 3.13		3.13		$ 3.12
Options vested and unvested options expected to vest, net of forfeitures, end of period (in dollars per share)	3.13		3.13
Options exercisable, end of period (in dollars per share)	$ 3.44		$ 3.44
Weighted average Remaining Contractual Life [Abstract]
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2			5 years 6 months 14 days		6 years 11 months 12 days
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2			5 years 6 months 14 days		6 years 11 months 12 days
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedAndExpectedToVestOutstandingWeightedAverageRemainingContractualTerm1			5 years 6 months 14 days
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsExercisableWeightedAverageRemainingContractualTerm1			4 years 4 months 17 days
Aggregate Intrinsic Value [Abstract]
Options outstanding, beginning of period			$ 1,247,000
Options outstanding, end of period	$ 659,000		659,000		$ 1,247,000
Options vested and unvested options expected to vest, net of forfeitures, end of period	659,000		659,000
Options exercisable, end of period	$ 547,000		$ 547,000
Closing price (in dollars per share)	$ 2.52		$ 2.52
Restricted Stock Awards [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average period of amortization			1 year 9 months 18 days
Shares [Roll Forward]
Non-vested, beginning of period (in shares)			261,000
Granted (in shares)			336,000
Vested (in shares)			(118,000)
Forfeited (in shares)			(13,000)
Non-vested, end of period (in shares)	466,000		466,000		261,000
Weighted Average Grant Date Fair Value [Roll Forward]
Non-vested, beginning of period (in dollars per share)			$ 2.71
Granted (in dollars per share)			2.56
Vested (in dollars per share)			2.65
Forfeited (in dollars per share)			2.34
Non-vested, end of period (in dollars per share)	$ 2.63		$ 2.63		$ 2.71
Unrecognized compensation expense related to restricted stock awards	$ 1.1		$ 1.1

Net Income (Loss) Per Share (De

Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Numerator: [Abstract]
Net income (loss) attributable to AXT, Inc.	$ (3)	$ 319	$ (1,027)	$ (1,721)
Less: Preferred stock dividends	(44)	(44)	(88)	(88)
Net loss available to common stockholders	$ (47)	$ 275	$ (1,115)	$ (1,809)
Denominator: [Abstract]
Denominator for basic net loss per share - weighted average common shares (in shares)	32,242	32,381	32,399	32,407
Effect Of Dilutive Securities On Earnings Per Share [Line Items]
Denominator for dilutive net (income) loss per common share (in shares)	32,242	32,597	32,399	32,407
Net income (loss) attributable to AXT, Inc. per common share:
Basic (in dollars per share)	$ 0	$ 0.01	$ (0.03)	$ (0.06)
Diluted (in dollars per share)	$ 0	$ 0.01	$ (0.03)	$ (0.06)
Weighted-average shares: [Abstract]
Preferred stock, shares issued (in shares)	883		883		883
Preferred stock, shares outstanding (in shares)	883		883		883
Preferred stock, par value (in dollars per share)	$ 0.001		$ 0.001		$ 0.001
Preferred stock, value	$ 3,532		$ 3,532		$ 3,532
Cumulative annual dividend rate (in hundredths)			5.00%		5.00%
Liquidation preference over common stock (in dollars per share)	$ 4		$ 4		$ 4
Options [Member]
Effect Of Dilutive Securities On Earnings Per Share [Line Items]
Effect of dilutive securities (in shares)	0	195	0	0
Restricted Stock Awards [Member]
Effect Of Dilutive Securities On Earnings Per Share [Line Items]
Effect of dilutive securities (in shares)	0	22	0	0
Options [Member]
Weighted-average shares: [Abstract]
Securities excluded from diluted net income (loss) per share as the impact is anti-dilutive (in shares)	3,102	1,782	3,102	2,645
Restricted Stock Awards [Member]
Weighted-average shares: [Abstract]
Securities excluded from diluted net income (loss) per share as the impact is anti-dilutive (in shares)	466	93	466	266

Segment Information and Forei43

Segment Information and Foreign Operations (Details) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2015USD ($)Customer	Jun. 30, 2014USD ($)Customer	Jun. 30, 2015USD ($)SegmentCustomer	Jun. 30, 2014USD ($)Customer	Dec. 31, 2014USD ($)Customer
Segment Information [Abstract]
Number of operating segments | Segment			1
Net revenues reported for products shipped to customers in corresponding geographic region [Abstract]
Revenue	$ 21,010	$ 21,449	$ 41,074	$ 40,794
Long-lived assets by geographic region [Abstract]
Long-lived assets	$ 33,366		$ 33,366		$ 33,862
Revenue [Member]
Revenue, Major Customer [Line Items]
Number of customers representing significant share | Customer	1	0	0	0
Percentage share generated by major customers (in hundredths)	10.00%	10.00%	10.00%	10.00%
Accounts Receivable [Member]
Revenue, Major Customer [Line Items]
Number of customers representing significant share | Customer	2				2
Major Customer One [Member] | Accounts Receivable [Member]
Revenue, Major Customer [Line Items]
Percentage share generated by major customers (in hundredths)			11.00%		10.00%
Major Customer Two [Member] | Accounts Receivable [Member]
Revenue, Major Customer [Line Items]
Percentage share generated by major customers (in hundredths)			11.00%		10.00%
Top Five Major Customers [Member] | Revenue [Member]
Revenue, Major Customer [Line Items]
Number of customers representing significant share | Customer	5	5	5	5
Percentage share generated by major customers (in hundredths)	37.00%	37.00%	36.00%	35.00%
Reportable Geographical Components [Member] | Europe (primarily Germany) [Member]
Net revenues reported for products shipped to customers in corresponding geographic region [Abstract]
Revenue	$ 5,664	$ 4,968	$ 10,607	$ 11,551
Reportable Geographical Components [Member] | China [Member]
Net revenues reported for products shipped to customers in corresponding geographic region [Abstract]
Revenue	3,561	4,960	6,858	9,125
Long-lived assets by geographic region [Abstract]
Long-lived assets	32,252		32,252		$ 33,726
Reportable Geographical Components [Member] | Taiwan [Member]
Net revenues reported for products shipped to customers in corresponding geographic region [Abstract]
Revenue	3,414	2,785	6,523	4,900
Reportable Geographical Components [Member] | North America (primarily the United States) [Member]
Net revenues reported for products shipped to customers in corresponding geographic region [Abstract]
Revenue	2,850	2,829	6,322	4,609
Long-lived assets by geographic region [Abstract]
Long-lived assets	1,114		1,114		$ 136
Reportable Geographical Components [Member] | Asia Pacific (excluding China, Japan and Taiwan) [Member]
Net revenues reported for products shipped to customers in corresponding geographic region [Abstract]
Revenue	2,768	2,450	5,527	4,839
Reportable Geographical Components [Member] | Japan [Member]
Net revenues reported for products shipped to customers in corresponding geographic region [Abstract]
Revenue	$ 2,753	$ 3,457	$ 5,237	$ 5,770

Commitments and Contingencies44

Commitments and Contingencies (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015USD ($)ft²	Jun. 30, 2014USD ($)	Jun. 30, 2015USD ($)ft²	Jun. 30, 2014USD ($)
Product Warranty [Abstract]
Period of warranty			12 months
Change in warranty accrual [Roll Forward]
Beginning accrued warranty and related costs	$ 392	$ 1,227	$ 802	$ 1,048
Accruals for warranties issued	411	81	585	577
Adjustments related to pre-existing warranties including expirations and changes in estimates	42	(199)	(252)	(302)
Cost of warranty repair	(177)	(129)	(467)	343
Ending accrued warranty and related costs	$ 668	$ 980	$ 668	$ 980
Leases [Abstract]
Area of property under long-term operating lease (in square feet) | ft²	19,467		19,467
Term of royalty agreement			8 years
Aggregate amount payable towards royalty	$ 7,000		$ 7,000
Outstanding contractual obligations [Abstract]
Total	639		639
Less than 1 year	222		222
1-3 years	258		258
4-5 years	54		54
More than 5 year	105		105
Other Commitments, Fiscal Year Maturity [Abstract]
Total	2,764		2,764
Less than 1 year	910		910
1-3 years	1,408		1,408
4-5 years	341		341
More than 5 years	105		105
Royalty Agreement [Member]
Other Commitments, Fiscal Year Maturity [Abstract]
Total	2,125		2,125
Less than 1 year	688		688
1-3 years	1,150		1,150
4-5 years	287		287
More than 5 years	$ 0		$ 0

Foreign Exchange Transaction 45

Foreign Exchange Transaction Gains/Losses (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Foreign Exchange Transaction Gains/Losses [Abstract]
Foreign exchange transaction exchange gains (losses)	$ 30,000	$ 158,000	$ 210,000	$ 175,000

Income Taxes (Details)

Income Taxes (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2015USD ($)	Jun. 30, 2014USD ($)	Jun. 30, 2015USD ($)Subsidiary	Jun. 30, 2014USD ($)
Operating Loss Carryforwards [Line Items]
Net operating losses or credits utilization period			1 year
Period with in which cumulative ownership change			3 years
Gross unrecognized tax benefits	$ 16,400,000		$ 16,400,000
Unrecognized tax benefits interest and penalties	0
Unrecognized tax benefits accrued interest and penalties	0		$ 0
Number of partially owned subsidiaries | Subsidiary			3
Federal income tax benefit or expense	$ 0	$ 0	$ 0	$ 0
Minimum [Member]
Operating Loss Carryforwards [Line Items]
Change in cumulative ownership percentage (in hundredths)			50.00%

Whistleblower Complaint and I47

Whistleblower Complaint and Investigation (Details) $ in Millions	6 Months Ended
	Jun. 30, 2015USD ($)
Whistleblower Complaint and Investigation [Abstract]
Professional service fees	$ 1.8