Breaking News
FONT-SIZE Plus   Neg
Share SHARE

Cree Profit Drops, Sees Weak Q4; Shares Down 7% - Update

RELATED NEWS
Trade CREE now with 

Cree Inc. (CREE: Quote) Tuesday reported a 50 percent decline in profit for the third quarter, hurt mainly by a huge slump in margins reflecting higher expenses. Earnings fell short of estimates by a penny, while revenues that grew 30 percent, missed expectations.

Moving ahead, the company detailed its financial guidance for the fourth quarter which is below current market expectations. Shares of the energy-efficient LED lighting maker shed over seven percent in extended hours.

Gross margins for the third quarter dropped to 34.9 percent from 41.7 percent, while operating margins plummeted to 1.8 percent from 9.0 percent last year.

Cost of revenues increased to $185.4 million from $127.8 million last year. Sales, general and administrative expenses for the quarter rose to $94.4 million from $71.7 million last year.

Cree, which manufactures LED diodes, LED lighting, and semiconductor solutions for wireless and power applications, said revenues grew 30 percent to $284.8 million, but still fell short of analysts' estimate of $300.76 million.

Durham, North Carolina-based Cree's third-quarter net income dropped to $9.5 million or $0.08 per share from $18.9 million or $0.17 per share last year. On an adjusted basis, net income slipped to $0.20 per share from $0.27 per share last year. On average, twenty nine analysts polled by Thomson Reuters expected earnings of $0.21 per share. Analysts' estimates typically exclude special items.

Looking forward to the fourth quarter, Cree expects net income in a range of $0.04 to $0.10 per share and adjusted income of $0.20 to $0.26 per share. Analysts currently expect earnings of $0.28 per share for the fourth quarter.

Cree, which competes with Nichia Corp., Epistar Corp., OSRAM Semiconductor and Samsung LED Co., anticipates fourth-quarter revenues of $295 million to $315 million. Analysts currently expect revenues of $323.61 million for the quarter.

CREE closed Tuesday's trading at $31.90, up $0.98 or 3.17% on the Nasdaq. The stock, however, fell $2.26 or 7.08% in after-hours trade. Trading volume for the day was 5.5 million shares, above the three-month average volume of 3.3 million.

Register
To receive FREE breaking news email alerts for Cree Inc. and others in your portfolio

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
Home improvement and building products company Masco Corp. said Monday after the markets closed that its second quarter profit jumped 78% from last year, as revenue increased and margins improved amid strong performance of its Plumbing Products, Installation and Other Services and Decorative Architectural Products segments. American Financial Group Inc. (AFG) Monday reported second-quarter net earnings of $106 million or $1.15 per share, compared to $110 million or $1.20 per share last year. Core net operating earnings were $99 million or $1.07 per share, compared to $87 million or $0.96 per share last year. Total... Stocks showed a significant recovery over the course of the trading day on Monday after coming under pressure in early trading. The markets eventually ended the session roughly flat following the mixed performance that was seen last week.
comments powered by Disqus
FREE Newsletters, Analysis & Alerts

 

Stay informed with our FREE daily Newsletters and real-time breaking News Alerts. Sign up to receive the latest information on business news, health, technology, biotech, market analysis, currency trading and more.