On September 21, AXT Inc rose 8.11% in regular trading, trading at $76.49/share, with turnover of $175 million. The rally was driven by sustained strength in the optical communication sector, the opening of the European Conference on Optical Communication (ECOC) held September 20-24 in Spain, and a widening supply-demand gap for indium phosphide (InP) substrates.

Indium phosphide, a core substrate material for high-speed optical modules, now faces a global supply-demand gap exceeding 70%. Prices for 2-inch substrates have surged from $800 to $2,500 over the past 18 months, while 6-inch high-end substrates have seen price increases of over 250%. AXT, together with Sumitomo Electric and JX Metals, controls more than 90% of global InP substrate capacity, positioning the company as a direct beneficiary of the industry volume-and-price upcycle.

The broader optical communication sector has been supported by AI infrastructure upgrades. Goldman Sachs recently raised its optical module industry outlook, projecting the market to grow from $45.2 billion to $129.5 billion between now and 2028, driven by accelerating demand for 1.6T and 3.2T high-speed optical modules.

(The above content is based on publicly available market information, generated by a program or algorithm, and is intended solely as a stock movement alert. It does not constitute investment advice or a basis for trading decisions.)