Earnings Preview: Cree Inc. (NASDAQ: CREE) First Quarter 2011
Tuesday, October 05, 2021 9:47 AM

Related Stories

Cree Inc. (NASDAQ: CREE) is scheduled to release fiscal first-quarter earnings before the opening bell on Wednesday, October 20, 2010. Analysts, on average, expect the company to report earnings of 58 cents per share on revenue of $277.73 million. In the year-ago quarter, the company reported earnings of 30 cents per share on revenue of $169.13 million.

Cree, Inc. develops and manufactures light emitting diode (LED) products, which include LED chips used in video screens, gaming displays, function indicator lights, and automotive backlighting. The company's silicon carbide and gallium nitride wafers are used in making LEDs, RF and microwave devices, and power devices.

In the preceding fiscal fourth-quarter, the Durham, North Carolina-based company's net income was $52.8 million, or 48 cents a share, compared to $9.7 million, or 11 cents a share, in the prior-year quarter. On an adjusted basis, the company earned 55 cents a share in the latest quarter. Revenue surged 79% to $264.60 million. Analysts, on average, expected the company to report earnings of 51 cents per share on revenue of $264.00 million. Gross margin was up at 49.5%, compared to prior year's 39.6%. GAAP and non-GAAP gross margins are targeted to be 48% to 49%.
Looking ahead to first quarter of fiscal 2011 ending September 26, 2010, Cree expects revenue in a range of $270 million to $280 million with GAAP net income of $52 million to $56 million, or 48 cents to 51 cents per share. Non-GAAP net income is expected to increase quarter-over-quarter to a range of $62 million to $65 million, or 56 cents to 59 cents per share.

The LED industry continues to benefit from rising demand for LED backlighting for TV and growing LED adoption for general lighting. LEDs use far less electricity than traditional incandescent bulbs, saving money in the long run on both bulbs and utility bills. According to Cree, LEDs use 10% to 15% of the power of an incandescent, and about half the power of fluorescent bulbs.  Cree LED lights last as long as 50,000 hours, or 50 times longer than an incandescent light and five times longer than a fluorescent bulb. Unlike conventional fluorescent bulbs, LEDs do not contain toxic mercury. With incandescent light bulbs being gradually phased out by 2012, demand for LED lights is expected to increase significantly over the next few years. However, there are major risks here that investors need to consider. The LED industry is characterized by commoditization, intense competition and lower barriers to entry.

Among other developments, Cree recently announced a new 150mm LED wafer production facility in Research Triangle Park that will allow the company to produce 150mm LED wafers that are more than double the size of current ones, increasing the number of LEDs from a single wafer, helping to make LED lighting more cost-effective. The new production line is scheduled to be installed over the next several quarters with a target of having the first products qualified on this line by June 2011.

In terms of stock performance, Cree shares have lost nearly 5% since the beginning of the year.

Disclosure: Author doesn't own any of the stocks discussed here.


Symbol :


Market news:

  • Merkel, Sarkozy want quick bailout for Ireland Nov 25, 2021 07:23 PM

    • BERLIN - The 16-nation euro currency will survive the debt crisis, German Chancellor Angela Merkel vowed Thursday, and a senior central banker said the European Union would be willing to increase its ?750 billion ($1 trillion) bailout fund if necessary.
    • Axel Weber, the head of Germany's central bank and a leading rate-setter at the European Central Bank, said Thursday that European nations would be willing to boost the emergency fund by as much as ?100 billion ($133 billion) to fully cover the total public debt load of Greece, Ireland, Portugal and Spain.
    • But when Merkel and Sarkozy discussed the eurozone's troubles on the phone Thursday evening they said the ?750 billion emergency fund for the euro would remain unchanged until it expires in 2013, German government spokesman Steffen Seibert said in a statement.
      • More than 600,000 people killed by 2nd-hand smoke Nov 25, 2021 07:14 PM

        • LONDON - Second-hand smoke kills more than 600,000 people worldwide every year, according to a new study.
        • They found 40 percent of children and more than 30 percent of non-smoking men and women regularly breathe in second-hand smoke.
        • Peruga said WHO was particularly concerned about the 165,000 children who die of smoke-related respiratory infections, mostly in Southeast Asia and Africa.
          • Brady throws 4 TD passes, Patriots top Lions 45-24 Nov 25, 2021 06:02 PM

            • DETROIT - Tom Brady was perfect on the field and his exit was first class.
            • Brady threw a season-high four touchdown passes, all in the second half, and the New England Patriots routed the Detroit Lions 45-24 on Thursday after trailing by 11 late in the second quarter.
            • "We showed some resiliency, coming out in the second half and playing the way we did when the crowd was into it," Brady said.
              • AG: 2 murder charges for honeymoon death suspect Nov 25, 2021 05:37 PM

                • LOS ANGELES - An Alabama man who served prison time in Australia for his wife's drowning death during their honeymoon returned Thursday to the U.S., where he faces murder charges that could carry a much stiffer punishment.
                • Gabe Watson, 33, arrived in Los Angeles on Thursday morning after he was deported on a commercial flight from Melbourne, Australia.
                • Alabama hopes to arrange to bring Watson back to the state early next week, said Attorney General Troy King.
                  • US presence in Afghanistan as long as Soviet slog Nov 25, 2021 04:43 PM

                    • KABUL, Afghanistan - The Soviet Union couldn't win in Afghanistan, and now the United States is about to have something in common with that futile campaign: nine years, 50 days.
                    • What started out as a quick war on Oct. 7, 2001, by the U.S. and its allies to wipe out al-Qaida leader Osama bin Laden and the Taliban has instead turned into a long and slogging campaign.
                    • A Pentagon-led assessment released earlier this week described the progress made since the United States injected 30,000 more troops into Afghanistan earlier this year as fragile.

                      More news


    Recent Estimates

AnalystFirm NameSymbolEPS Estimate
mrbilltraderXXXXX POT$1.15
sam farahanXXXXX TECD$0.95
adfgafg ERTS($0.26)