8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): June 21, 2004,

AXT, INC.

(Exact name of registrant as specified in its charter)

Delaware	000-24085	94-3031310
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

4281 Technology Drive
Fremont, California 94538

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (510) 683-5900

Not Applicable

(Former name or former address, if changed since last report)

TABLE OF CONTENTS

	Item 4. Changes in Registrant’s Certifying Accountants
	Item 7. Financial Statements and Exhibits
	Item 9. Regulation FD Disclosure
SIGNATURES
EXHIBIT INDEX
EXHIBIT 16
EXHIBIT 99.1

Item 4. Changes in Registrant’s Certifying Accountants

(a)(1) Previous independent accountants

(i) On June 23, 2004 AXT, Inc., a Delaware corporation (“AXT” or the “Company”), dismissed PricewaterhouseCoopers LLP (“PwC”) as its independent auditors.

(ii) The audit reports of PwC on the consolidated financial statements of AXT for each of past two years did not contain an adverse opinion or a disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope or accounting principles.

(iii) The decision to change accountants was approved by AXT’s Audit Committee of the Board of Directors.

(iv) In connection with its audits for the two most recent fiscal years and through June 18, 2004, there have been no disagreements with PwC on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedures which disagreements, if not resolved to PwC’s satisfaction, would have caused PwC to make reference to such disagreement in their report on the financial statements for such years.

(v) During the two most recent fiscal years and through June 18, 2004, there have been no reportable events as defined in Item 304(a)(1)(v)(A), (B), (C) or (D) of Regulation S-K, except that, in its letter to the Audit Committee Members dated June 7, 2004, in connection with the review of the financial statements for the quarter ended March 31, 2004, PwC noted that as part of the Company’s implementation of its Code of Business Conduct and Ethics, the Company learned, and informed PwC, of certain failures to comply with requirements for product testing and the provision of testing data and information relating to requirements of certain customers. The Company’s investigation into the product testing practices and procedures conducted, with the assistance of outside counsel, confirmed that certain customer requirements were not being complied with.

PwC indicated that it believes that the condition that enabled the deficiency to exist, including the lack of an effective monitoring and operational oversight function in this area, is a material weakness as defined in AU 325, Communication of Internal Control Related Matters Noted In An Audit (AU 325) of the AICPA Professional Standards. PwC recommended that the Company implement specific measures to ensure greater operational controls and compliance with customer requirements. Company management did not disagree with the suggestions made by PwC.

The Audit Committee of the Board of Directors discussed these matters with PwC, and the Company has authorized PwC to respond fully to any inquiries by Burr, Pilger & Mayer LLP concerning these matters.

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The Company has requested that PricewaterhouseCoopers LLP furnish it with a letter addressed to the Commission stating whether or not it agrees with the above statements. A copy of such letter, dated June 24, 2004 is filed as Exhibit 16 to this Form 8-K.

(2) New independent accountants

The Company engaged Burr, Pilger & Mayer LLP as its independent auditors as of June 23, 2004. During the two most recent fiscal years and through the date of their engagement by the Company, the Company did not consult with Burr, Pilger & Mayer LLP regarding either (i) the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Company’s financial statements, and neither a written report was provided to the Company or oral advice was provided that Burr, Pilger & Mayer LLP concluded was an important factor considered by the Company in reaching a decision as to the accounting, auditing or financial reporting issue; or (ii) any matter that was either the subject of a disagreement, as that term is defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions to Item 304 of Regulation S-K, or a reportable event, as that term is defined in Item 304(a)(1)(v) of Regulation S-K.

Item 7. Financial Statements and Exhibits

Exhibit 16:	Letter from PricewaterhouseCoopers LLP to the Securities and Exchange Commission
Exhibit 99.1:	Press Release dated June 21, 2004.

Item 9. Regulation FD Disclosure

     On June 21, 2004, the Company announced that it is reducing the workforce at its Fremont, California manufacturing facility by approximately 45 positions or approximately 35% over the next 60 days. This measure is being taken as part of the Company’s ongoing effort to consolidate manufacturing at its production facility in China. The Company will record a restructuring charge of approximately $1.3 million in the second quarter related to the reduction in force and to lease costs associated with facilities that are no longer required to support production.

     A copy of the press releasing announcing this action is attached hereto as Exhibit 99.1.

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SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	AXT, INC.
Date: June 24, 2004	By:	/s/ WILSON W. CHEUNG
		Wilson W. Cheung
		Chief Financial Officer

4

EXHIBIT INDEX

Exhibit
Number	Description
16	Letter Regarding Change in Certifying Accountant
99.1	Press Release dated June 21, 2004

5

EX-16

Exhibit 16

Letter Regarding Change in Certifying Accountant

June 24, 2004

Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

Commissioners:

     We have read the statements made by AXT, Inc. (copy attached), which we understand will be filed with the Commission, pursuant to Item 4 of Form 8-K, as part of the Company’s Form 8-K report dated June 21, 2004. We agree with the statements referencing our Firm in such Form 8-K.

Very truly yours

/s/ PricewaterhouseCoopers LLP

EX-99.1

Exhibit 99.1

Contacts:

Wilson W. Cheung
Chief Financial Officer
(510) 683-5900

AXT Announces Workforce Reduction at Fremont Manufacturing Facility
Estimates $1.3 Million Restructuring Charge in the Second Quarter

FREMONT, Calif. — June 21, 2004 — AXT, Inc. (Nasdaq: AXTI), today announced that it is reducing the workforce at its Fremont, California manufacturing facility by approximately 45 positions or approximately 35 percent over the next 60 days. This measure is being taken as part of the company’s previously announced and ongoing effort to consolidate manufacturing at its production facility in China. The company will record a restructuring charge of approximately $1.3 million in the second quarter related to the reduction in force and to lease costs associated with facilities that are no longer required to support production.

About AXT, Inc.

AXT is a leading producer of high-performance compound semiconductor substrates for the fiber optics and communications industries. The company’s proprietary Vertical Gradient freeze (VGF) crystal growth technology produces low-defect, semi-insulating and semi-conducting gallium arsenide, indium phosphide and germanium wafers. For more information, see AXT’s website at http://www.axt.com         . The company can also be reached at 4281 Technology Drive, Fremont, California 94538 or by calling 510-683-5900. AXT is traded on the Nasdaq National Market under the symbol AXTI.

Safe Harbor Statement

The foregoing paragraphs contain forward-looking statements within the meaning of the Federal Securities laws, including statements related to the planned shutdown of manufacturing at the Company’s Fremont facilities and to restructuring charges related to this shutdown. Such forward-looking statements are based upon specific assumptions subject to uncertainties and factors relating to the Company’s operations and business environment, which could cause actual results of the Company to differ materially from those expressed or implied in the forward-looking statements contained in the foregoing discussion. Such uncertainties and factors include: any adjustments that may be required in the estimated restructuring charges, overall conditions in the markets in which we compete, market acceptance and demand for our products, the impact of competitive products and pricing, and other factors as set forth in the Company’s Form 10-K and other filings made with the Securities and Exchange Commission, all of which are difficult to predict and some of which are beyond the Company’s control. The Company does not undertake any obligation to update publicly any forward-looking statement, either as a result of new information, future events or otherwise.

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