POET Technologies Inc. (POET (POET)) shares fell more than 11% on Friday after the company announced a $400 million capital raise alongside first-quarter results that showed widening losses, even as revenue surged on AI infrastructure demand.
The company is selling 19.05 million common shares and matching warrants to a single institutional investor in a non-brokered registered direct offering. The combined purchase price is $21 per unit, and the warrants are exercisable for three years at $26.15 per share. The deal could generate gross proceeds north of $400 million, with closing expected Monday.
POET plans to use the cash for manufacturing expansion, acquisitions, research, and operational scaling — especially within its light source business. It also wants to strengthen working capital flexibility. But the market is focused on the immediate dilution: the offering represents roughly 20% of shares outstanding, based on recent counts.
Revenue Triples, But Losses Widen
First-quarter revenue hit $503,389, up from $166,760 a year ago and above the $341,202 reported in Q4 2025. That topped analyst estimates of $300,000. But the GAAP net loss widened to $12.3 million, or 8 cents per share, worse than the expected 5-cent loss.
Research and development expenses ticked up to $4.5 million, while stock-based compensation jumped sharply year-over-year. Operating cash outflow was $8.8 million for the quarter. The company didn't disclose debt or quarter-end cash balances, leaving investors to guess at the burn rate.
AI Partnerships Grow
Chairman and CEO Dr. Suresh Venkatesan struck an optimistic tone. "During the first quarter of 2026, we made significant progress in expanding POET's strategic position within the AI and hyperscale data center ecosystem," he said. The company announced partnerships with LITEON Technology and Lessengers for optical transceiver modules used in hyperscale AI systems.
Still, the market is clearly worried about dilution and cash burn. At Friday's close, POET shares were down 11.16% at $18.27. The stock has been volatile as investors weigh the promise of AI networking against the reality of a company that's still burning cash and issuing shares to fund its growth.
