2 October 2014

Cree lowers quarterly revenue forecast from $440-465m to $428m

Reporting preliminary estimates of its financial results for fiscal first-quarter 2015 (ended 28 September 2014), Cree Inc of Durham, NC, USA expects revenue to be about $428m, up 9.5% on $391m a year ago but down 2% on the record $436.3m in the June quarter and below the $440-465m forecasted in mid-August.

Revenue for LED Products (LED components, LED chips, and silicon carbide materials) should be $174m, down 13% on $199.5m in the June quarter and down 20% on $218m a year ago. Due to weaker global demand than originally expected, revenue is expected to be lower sequentially for both direct and distribution customers.

Lighting Products revenue (mainly LED lighting systems and bulbs) should be up 51% on $147.9m a year ago and 7% on $208.2m in the June quarter to $223m, which is at the higher end of the previously announced target due to growth in both LED fixtures and LED bulbs.

Power & RF Products revenue should be up 24% on $25.1m a year ago and 8% on $28.6m in the June quarter to $31m, which is also at the higher end of the previously announced target.

Overall gross margin is expected to be below the targeted 37.5% (down from 37.9% in the June quarter and 39.2% a year ago), due mainly to the lower LED Products revenue and higher-than-targeted LED bulb revenue. LED Products and Lighting Products segment gross margins are expected to be lower sequentially, due mainly to the product mix within each segment.

Operating expenses should be slightly lower than previously targeted. Earnings (on a GAAP basis) are expected to be below the previously forecasted $0.25-0.30 per diluted share.

The preliminary financial results are subject to completion of the firm’s customary quarterly closing and review procedures.

Under its stock repurchase program, during fiscal Q1 Cree repurchased 1.2 million shares of its common stock at an average price of $45.22 per share (worth a total $54.3m). After this repurchase, there is $146m in total purchase price value remaining in the firm’s stock repurchase program through 28 June 2015.

Cree says that, for fiscal Q2/2015, order visibility remains limited and similar to this point in its fiscal first quarter.

See related items:

Cree's quarterly revenue up 8% to record $436m, driven by 18% growth in lighting products

Cree's quarterly revenue grows 16% year-on-year to $405m, driven by 35% growth in lighting products

Cree’s quarterly revenue grows 20% year-on-year to record $415m

Cree's quarterly revenue grows 24% year-on-year to record $391m

Tags: Cree LED

Visit: www.cree.com