Key Highlights

  • Tradr 2X Short AXTI Daily ETF (CBOE:AXTQ) rose 20.17% to USD 40.57 on October 22, 2026, from USD 33.76, implying AXT fell about 10.1%, simple arithmetic on the published change and the quote.
  • AXT reported record indium phosphide Revenue of USD 30.7 million in the second quarter, about 65% of its USD 47.6 million total, against consensus of USD 34.1 million.
  • Non-GAAP gross Margin reached 45.0% versus 8.2% a year earlier, and third-quarter revenue guidance is about USD 66 million, which keeps expectations high. Management expects Demand to stay above Supply as capacity expands, which supports the revenue outlook.
  • Customer prepayments of USD 22.3 million and USD 25.4 million, plus a Backlog above USD 100 million, tie AXT's fortunes to optical laser makers such as Coherent.

What Moved the Fund

The fund rose 20.17% on October 22, 2026, implying AXT fell about 10.1%. No AXT-specific release was found for the day. The move came in a broad AI and semiconductor selloff. Lam Research (NASDAQ:LRCX) posted record revenue of USD 8.22 billion on October 21, 2026, then fell about 9% on October 22 after guiding December-quarter revenue to USD 8.6 billion, plus or minus USD 400 million, and citing supply constraints. AXT supplies indium phosphide substrates to optical laser makers, so weakness in Coherent, Lumentum and Applied Optoelectronics tends to pass straight through to the stock, which is thinly followed and small, magnifying every swing. Export-permit headlines from China can also move the shares sharply on a day with no company release.

AXT Fundamentals

AXT (NASDAQ:AXTI) reported second-quarter revenue of USD 47.6 million on July 30, 2026, with non-GAAP EPS of USD 0.19 against USD 0.07 expected. Indium phosphide revenue was a record USD 30.7 million. Backlog exceeds USD 100 million into 2027, and prepayments came from Casela (USD 22.3 million) and Coherent (USD 25.4 million), with a long-term agreement covering Lumentum. Management targets about USD 60 million of quarterly indium phosphide capacity exiting 2026 and says demand exceeds supply. Guidance reflects products where China export permits are available or not required. Third-quarter results are estimated for October 29, 2026, unconfirmed. Non-GAAP gross margin reached 45.0%, up from 29.9% in the first quarter and 8.2% a year earlier.

Mechanics and Risks

AXTQ launched on August 17, 2026, trades on Cboe BZX, charges 1.49% and held about USD 6.0 million in assets. It targets minus 2x of AXT's daily move using swaps. If AXT rose 15% then fell 15%, the stock would end down 2.25% while the fund would end down 9.0%, simple arithmetic. Small Assets and a volatile underlying can mean wide spreads. A single positive Earnings surprise could push AXT up sharply, and a gain above 50% in a day would end the fund. Investors should also check swap financing costs, which add to the stated expense ratio over time. The prospectus sets out the swap counterparties and Collateral arrangements.

Where Things Stand

Tradr 2X Short AXTI Daily ETF (CBOE:AXTQ) surged because AXT fell about 10.1% in a sector selloff, and the fund doubles the inverse. AXT's fundamentals are strong, with record indium phosphide revenue, wider margins and prepaid demand, so the decline looks like de-risking of a high-momentum small cap. The next catalyst is the third-quarter report, estimated for October 29, 2026 and unconfirmed, where the USD 66 million revenue guide will be tested.