AXT Inc. (AXTI) just delivered a quarter that made investors very happy. After Thursday's closing bell, the semiconductor wafer manufacturer reported second-quarter results that smashed analyst estimates on both the top and bottom lines. The stock, which had already gained nearly 27% during the regular session, kept climbing in extended trading.

Here's what the numbers looked like. AXT posted earnings of 19 cents per share, blowing past the consensus estimate of 7 cents by a whopping 171%. Revenue came in at $47.59 million, easily topping the Street's forecast of $34.09 million — a beat of nearly 40%.

The company's gross margins tell an even more dramatic story. On a non-GAAP basis, gross margin hit 45% of revenue in the second quarter of 2026. That's up from 29.9% in the first quarter and just 8.2% in the same period last year. In other words, AXT is not just selling more — it's keeping a lot more of what it sells.

CEO Morris Young summed up the moment: "This is an incredibly exciting time for AXT. We have reached an inflection point in our business where strong customer demand for data center optical connectivity coupled with our continued success in adding manufacturing capacity and improving productivity are driving a step-function increase in our revenue."

Investors clearly agree. AXT stock was up 27% to $59.64 in Thursday's after-hours trading, according to market data.