AXT Inc's stock experienced a significant intraday plummet of 7.15% on Thursday, continuing a period of heightened volatility for the semiconductor materials company.

The sharp decline appears to be driven primarily by ongoing investor concerns over share dilution following the company's completion of a $550 million underwritten public offering. The offering of approximately 8.6 million common shares has raised significant worries about the impact on existing shareholders' equity positions, creating sustained selling pressure in the market.

According to company disclosures, proceeds from the offering are earmarked primarily to support capacity expansion for indium phosphide substrates at its Beijing Tongmei Xtal Technology subsidiary. However, such large follow-on offerings typically create downward pressure on stock prices as the market adjusts to the increased share count and potential selling pressure from the new shares entering circulation.