Three second-derivative AI plays are in focus Friday morning. AXT (NASDAQ:AXTI) is trading higher alongside a broad rally in optics names, T1 Energy (NYSE:TE) is bouncing on the domestic solar policy trade, and Babcock & Wilcox Enterprises (NYSE:BW) is drawing attention around a fresh institutional disclosure. The connective tissue: AI capex is now pulling in materials, power gear, and energy suppliers well beyond the obvious chip names.
AXT Rides the Optical Connectivity Trade
AXT is up about 3.1% today, around $79.83, after an Aug. 13 close of $77.45. The catalyst is a sector move. Applied Optoelectronics is up about 5%, Lumentum about 4%, and Corning about 4.5%. AXT makes compound semiconductor substrates, and its indium phosphide wafers are a key input for the high-speed optical transceivers and silicon photonics used in AI data centers. When the optical connectivity trade runs, AXT runs with it as the upstream materials supplier.
The fundamental case got a fresh push from Q2 FY26 results reported July 30, 2026, when revenue hit $47.59M, up 164.8% year over year, and CEO Morris Young said the company “reached an inflection point” on data center optical connectivity demand. The Q2 details are laid out in AXT’s 8-K filing on SEC.gov. Investors should note the setup is stretched: YTD +373.7%, one-month +34.5%, one-year +3,453%. That one-year figure is extraordinary and cuts both ways.
T1 Energy Bounces on the Tariff Backdrop
T1 Energy is up about 9.5% today. T1 reported Q2 FY26 on Wednesday, August 12, 2026, with revenue of $250.13M beating the $198.84M consensus by roughly 26% and management guiding toward the high end of its 3.1 to 4.2 GW production range. First cells from the 2.1 GW G2_Austin fab are expected in Q1 2027.
The more likely thread today is policy. Trump launched significant new solar tariffs on Aug. 7, 2026, and Reuters reported Aug. 4, 2026 that the US was weighing a polysilicon price floor and tariffs to counter China. Both are protective of the exact domestic supply chain T1 is building. CEO Dan Barcelo told analysts the “framework aligns with T1’s commitment to establish the first end-to-end domestic polysilicon solar supply chain built on leading US technology.” Read this as interpretation, not confirmed cause. Even after today’s pop, TE is down about 28% year to date and down about 30% over the past month. It’s a bounce so far, with the longer trend still down.
Babcock & Wilcox: Data Center Power, Ugly Chart
BW’s is up 11% on the day. Ameriprise Financial disclosed a 7.66 million-share position in Babcock & Wilcox today, a point-in-time filing that likely drove morning attention. Earlier this week, BW announced work on 20 steam turbines with Siemens Energy for data center power, sending shares up roughly 33% on Aug. 11, and CEO Kenneth Young purchased 7,000 shares at $9.65 on Aug. 13.
Q2 FY26 revenue came in at $319.7M, up 121.9% year over year, including $100.7M from the Base Electron 1.2 GW natural gas AI data center power project in North Dakota. Management raised FY2026 Adj EBITDA guidance to $80M to $105M and flagged a global pipeline above $14B. Risk is equally real. BW’s chart remains weak despite the operational turn. This is a heavily restructured industrial being repriced on data center power demand, and it still trades like a turnaround.
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