All indications pointed to a bad quarter for GT Advanced Technologies (NASDAQ: GTAT), and now that the numbers are out the market seems to be breathing a sigh of relief. The company isn't collapsing and there appears to be some light at the end of the tunnel. Although, when we reach that light is anybody's guess.

PV continues to slide
The solar market is oversupplied and GT benefited from this build-out by supplying more polysilicon and PV equipment than the world needed. Now it's time to pay the piper, and demand has cratered in these markets.

In the third quarter, the company sold just $1.6 million of PV equipment, down from $111.2 million a year earlier, and polysilicon sales were down slightly to $95.9 million.

The challenge is that solar manufacturers like LDK Solar (NYSE: LDK), Yingli Green Energy (NYSE: YGE), and Suntech Power (NYSE: STP) have all used short-term bank financing to buy equipment and build capacity. But GT said that over the last 30 days liquidity has tightened at Asian banks who are contemplating the financial future of Chinese solar. This is a big hit to GT's short-term demand.

On the plus side, the company is expecting a solar turnaround in late 2013 or 2014, driven by higher efficiency technology like HiCz, GT's new offering. This should drive a new round of capital spending in solar, although the size and timing of the spending is still unknown.

Sapphire shows promise
GT is expecting its sapphire business to pick up in 2013 after a pretty disappointing quarter. The company sold $12.6 million worth of sapphire equipment, about a third of last quarter.

The hope is that new end markets like LED, touch and cover screens, and other new businesses increasingly adopt sapphire products. Again, this is an upside play for GT and it's unknown how much demand will really show up in 2013, just like solar.

Cautiously optimistic
I like a lot of the markets that GT plays in, but there are a lot of outstanding questions about demand. The good news is that the company still generated a $0.02 per share profit despite weak sales and has $181 million of net cash on the balance sheet. That's a big chunk of the company's $520 million market cap.

I'd be cautiously optimistic about the stock here and take any major dips as buying opportunities. I wouldn't be a big buyer until demand picks up, but if it does this could be a multi-bagger.