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20 October 2006


Cree's profits fall; sales flat year-on-year

Cree Inc of Durham, NC, USA, which manufactures LEDs, silicon carbide and gallium nitride based power-switching devices and radio-frequency/wireless devices, and silicon carbide substrates, has reported revenue of $103.9m for
its fiscal first quarter 2007 (to end-September), up 1% on
a year ago. Net income from continuing operations fell from $21.7m to $13.3m. Gross profit was 41% and operating profit was 16% of revenue.

"While short-term market conditions remain challenging, we continue to make outstanding progress towards our goal of enabling LEDs to become a cost-effective, energy-saving alternative for lighting applications," said Chuck Swoboda, chairman and chief executive officer. "The recently introduced EZBright 1000 LED power chip and the latest XLamp 7090 power LED have established a new class of performance by dramatically increasing the light output and efficiency provided by LEDs," he claims. "Looking forward,
we are on track with our strategy to broaden our product lines into higher-value components for the tremendous markets in lighting and power."

For its fiscal Q2/2007, Cree is targeting revenue of $105-109m (excluding amortization of acquisition-related intangibles resulting from the acquisition of SiC wafer maker INTRINSIC Semiconductor, expected to be finalized by December 2006).