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Rubicon Technology Shares Plunge 12% On Weak Outlook, Q4 Loss

Shares of Rubicon Technology, Inc. (RBCN) plunged nearly 12 percent in extended trade on Wednesday after the semiconductor company provided earnings and revenue guidance for the first quarter, significantly below Street view.

The company also reported a loss for the fourth quarter compared to a profit last year, reflecting lower margins amid higher costs. Loss per share came in wider than analysts' expectations by a penny, while quarterly revenues matched their estimates.

"We saw strong demand for our six-inch polished wafers in the quarter, particularly from the LED market. We continue to be the largest provider of six-inch polished wafers in the market due to our strength in both large diameter crystal growth and large diameter polishing, evidenced by the fact that we have now shipped over 400,000 polished six-inch wafers to date into the LED and SoS markets," President and CEO Raja Parvez said in a statement.

The Franklin Park, Illinois-based provider of sapphire substrates and products to the LED, RFIC, semiconductor, and optical industries, reported a net loss of $1.13 million or $0.05 per share for the fourth quarter, compared to net income of $0.86 million or $0.04 per share in the prior-year quarter.

On average, nine analysts polled by Thomson Reuters expected the company to report a loss of $0.04 per share for the fourth quarter. Analysts' estimates typically exclude special items.

Revenue for the quarter grew to $20.09 million from $19.36 million in the same quarter last year, and matched nine Wall Street analysts' consensus estimate of $20.09 million.

The company noted that it has started taking orders for two through four inch core products for delivery in the first and second quarters, despite pricing environment having not improved, in order to begin reducing inventory levels and maintain customer relationships.

For fiscal 2012, the company reported a net loss of $5.54 million or $0.25 per, compared to net income of $38.06 million or $1.61 per share in the prior year. Revenue for the full year halved to $67.24 million from $134.0 million in the previous year.

Street was looking for full-year 2012 loss of $0.23 per share on annual revenues of $67.24 million.

Looking ahead to the first quarter, the company expects a loss in a range of $0.10 to $0.14 per share, on projected revenues of about $8 million, with analysts currently anticipate a loss of $0.02 per share on quarterly revenues of $20.25 million.

The sequential revenue decline is due to the anticipated lower six-inch wafer sales as the company's largest LED customer for six-inch wafers has excess inventory and will not likely need additional material until the second quarter. However, the company sees strong orders for six-inch wafers in the second half from both the SoS and LED markets.

"With the accelerating growth of the general lighting sector of the LED market and with the increasing complexity of mobile devices creating greater opportunity for SoS technology, I am very excited by the longer term growth potential of the markets we serve," Parvez added.

RBCN closed Wednesday's regular trading session at $5.77, down $0.20 or 3.33% on a volume of 0.53 million shares. The stock plunged a further $0.67 or 11.61% in after-hours trading.

by RTT Staff Writer

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