AXT Inc's stock experienced a pre-market plunge of 5.18% on Friday, extending a pullback from recent highs.

The decline is attributed to significant profit-taking pressure, as investors locked in gains after the stock surged to a 52-week high earlier in the week. This follows the company's recent report of better-than-expected first-quarter results, which included a swing to gross profit and a substantial revenue increase. However, ongoing uncertainty regarding the timing of additional export permit approvals for key materials like indium phosphide may have contributed to investor caution at current price levels.

The move was amplified by broad weakness in the semiconductor equipment sector during the session, with several major peers also trading lower. The combination of subdued sector sentiment and individual stock profit-taking amplified the pullback magnitude following the stock's previous rally driven by strong earnings and surging AI optical communication demand.