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Cree, Inc. (CREE)

  • Mon, Aug. 24, 12:45 PM
    • Off nearly 9% in early trading, the Nasdaq is now down just 0.4%. Along the way, many tech names have not only erased their early losses, but are now posting major gains.
    • Standouts include Micron (MU +5.3%), Skyworks (SWKS +6.7%), GoPro (GPRO +4.1%), Cree (CREE +6.7%), SunPower (SPWR +6.1%), Mobileye (MBLY +5.1%), Amkor (AMKR +9.1%), ExOne (XONE +4.7%), NXP (NXPI +3.7%), Yelp (YELP +4.3%), Cirrus Logic (CRUS +4.4%), and GoDaddy (GDDY +4.1%).
    • See also: SolarCity, SunEdison
    • Update (4:08PM ET): The Nasdaq went south again in afternoon trading, closeng down 3.8%. Skyworks, Cree, SunPower, Amkor, Mobileye, ExOne, and GoDaddy managed to stay in the green, while Micron, NXP, Yelp, GoPro, and Cirrus closed with modest losses.
  • Wed, Aug. 12, 3:05 PM
    • Down in AH trading yesterday after posting mixed FQ4 results and issuing in-line FQ1 guidance, CREE is singing a very different tune today. Low expectations - shares went into earnings down 67% from their Aug. 2013 peak - are helping out. So might short-covering: 20.8M shares (nearly 1/5 of the float) were shorted as of July 31.
    • On the earnings call (transcript), CFO Mike McDevitt noted a recent patent-cross-licensing deal with Taiwanese LED chipmaker Epistar will provide a lift to FQ1 gross margin. CEO Chuck Swoboda promised the consolidation of two North Carolina LED fabs will provide a boost in future quarters.
    • Swoboda also noted Cree's LED lighting growth is now primarily being driven by commercial lighting rather than consumer bulbs. "I think our [lighting] margins overtime will merge towards our commercial margins and if you look at that market over the past three to five years, the commercial lighting industry generally, once you get to the about a billion dollars, they typically have mid-thirties gross margins and low double-digit operating margins and so, that would be our near to mid-term goal as to get the business at that level." For reference, Cree's FQ4 lighting gross margin was 24.8%.
    • FQ4 results/FQ1 guidance, details
  • Tue, Aug. 11, 7:09 PM
    • After barely moving at first in response to its mixed FQ4 results and in-line FQ1 guidance, CREE has sold off to $24.25 in AH trading, putting shares once more near their 52-week low of $23.63.
    • Responsible for the FQ4 EPS miss: Gross margin (non-GAAP) fell to 21% from FQ3's 31.4% and the year-ago period's 37.9%, thanks to both LED chip/component price pressure and restructuring charges. Cree stated in its June 24 warning GM would be below prior guidance of ~32%, but didn't give a number. GM is expected to rebound to ~32% in FQ1.
    • Segment performance: FQ4 Lighting Product revenue +10% Y/Y to $229.1M; gross margin fell to 24.8% from 29.1% a year ago. LED Product (chip/component) revenue -39% to $122.2M; gross margin fell to 7% from 45%. Ahead of an IPO for the unit, Power/RF sales rose 15% to $123.9M; gross margin fell to 52.5% from 56.9%.
    • Financials: GAAP R&D spend fell 7% Y/Y to $45.3M; SG&A spend rose 8% to $76.8M. Cree ended FQ4 with $713M in cash/investments, and $200M in long-term debt.
    • FQ4 results/FQ1 guidance, PR
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  • Tue, Aug. 11, 4:05 PM
    • Cree (NASDAQ:CREE): FQ4 EPS of -$0.19 misses by $0.15.
    • Revenue of $382.2M (-12.4% Y/Y) beats by $3.28M.
    • Expects FQ1 revenue of $410M-$430M and EPS of $0.18-$0.23 vs. a consensus of $418.5M and $0.20.
    • Shares nearly unchanged AH.
    • Press Release
    • Update: Cree finished AH trading down 3%.
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  • Mon, Aug. 10, 5:35 PM
  • Thu, Jul. 9, 10:51 AM
    • Cree (CREE +0.9%) is acquiring Arkansas Power Electronics (APEI), a developer of diodes, thyristors, MOSFETs, IGBTs, and other power management chips/modules delivering high power densities and efficiencies. Terms are undisclosed.
    • APEI will join Cree's Power/RF chip unit, which is set to go public. Like Cree, APEI's power management chips are often made using silicon carbide (SiC).
    • Cree declares the purchase will "[infuse] the Power and RF business with additional intellectual property and applications expertise at the systems level," and help it "accelerate delivery of a full spectrum of SiC power modules to meet customer requirements for performance and cost."
  • Thu, Jun. 25, 9:17 AM
  • Wed, Jun. 24, 4:21 PM
    • CREE now expects FQ4 (June quarter) revenue of $375M, well below prior guidance of $420M-$440M and a $430.8M consensus. Gross margin and op. margin are now also expected to be below prior targets.
    • In addition, the company is targeting FY16 (ends June '16) revenue of ~$1.8B, below a $1.89B consensus. FY16 op. margin and free cash flow targets are respectively at ~8% and $75M.
    • FQ4 LED product (chip/component) revenue is expected to take a $35M hit from channel revenue reserve changes and lower prices, and consumer LED bulb sales have seen "a greater-than-targeted seasonal slowdown." Commercial LED lighting has seen "strong growth," and the power/RF chip unit (set for an IPO) is performing in-line with expectations.
    • The LED product unit is being restructured to "reduce excess capacity and overhead to improve the cost structure moving forward." $85M worth of restructuring charges ($38M non-GAAP) are expected.
    • A $500M buyback authorization has been launched for FY16. Cree adds it finished a prior $550M buyback (announced last October) in FQ4 by purchasing $160M worth of shares at an average price of $33.37.
    • Shares have fallen to $29.55 AH. CC at 5PM ET (webcast).
  • Tue, Jun. 16, 3:53 PM
    • CREE has seen 4,658 contracts trade for June 26 calls sporting a $31.50 strike price. Nearly 1K contracts have also been traded for June 19 calls with strike prices ranging from $30.50-$31.50. Shares have rallied on a day the Nasdaq is up 0.5%.
    • Separately, Cree announced this morning it's partnering with home automation hardware/software provider SmartThings to make its Connected LED bulbs compatible with SmartThings' platform.
    • Last month: Cree CEO buys 10K shares
  • Thu, May 28, 12:31 PM
    • CREE chairman/CEO Chuck Swoboda discloses he bought 10K shares on Tuesday at $29.32, bringing his total stake to 345K.
    • The purchase is Cree's first insider buy since last October, when director John Replogle bought 5K shares. It comes with Cree continuing to trade more than 50% below its 2013 highs, and 10 days after the company announced IPO plans for its power/RF chip unit.
  • Thu, May 21, 10:51 AM
    • CLSA has upgraded CREE to Underperform from Sell. Shares have rallied towards $31 in response.
    • The LED lighting/component maker jumped on Monday after announcing IPO plans for its Power/RF chip unit, but gave back most of its gains over the next two days.
  • Mon, May 18, 9:18 AM
    • CREE has confidentially filed for a potential IPO for its Power and RF unit. The offering's pricing and size haven't yet been determined; Cree intends to maintain a majority stake post-IPO.
      The unit makes silicon carbide (SiC) power management ICs - they can often deliver higher switching speeds and power densities than silicon alternatives - along with gallium nitride (GaN) power amplifiers for demanding telecom infrastructure and satellite/radar applications.
    • Power/RF had calendar Q1 (FQ3) revenue of $31M (+13% Y/Y), and a gross margin of 53.1% (well above a company-wide GM of 31.4%).
    • CREE +1.2% premarket to $30.10.
  • Wed, May 6, 3:31 PM
    • Today's notable tech gainers include LED/chip equipment maker Aixtron (AIXG +6.7%), distributed power system/software firm PowerSecure (POWR +7.2%), cloud customer support software vendor Zendesk (ZEN +5%), and chip packaging IP firm Tessera (TSRA +4.9%).
    • Notable decliners include LED giant Cree (CREE -4.2%), 3D printer maker ExOne (XONE -5.6%), big data/analytics software provider Hortonworks (HDP -5.7%), health site owner Everyday Health (EVDY -7.7%), and IP licensing firm WiLAN (WILN -6%). The Nasdaq is down 0.7%.
    • PowerSecure is up after beating Q1 estimates on the back of major increases in Distributed Generation and Solar Energy segment sales. Zendesk is up after posting a Q1 beat and guiding for full-year revenue of $192M-$195M (above a $189.6M consensus). Tessera is rallying thanks to a Q1 beat and strong Q2 guidance (revenue of $62M-$64M and EPS of $0.47-$0.50 vs. a consensus of $$57.3M and $0.40).
    • Cree is adding to the losses seen two weeks ago after it posted mixed results and light guidance. ExOne's drop comes after larger rival 3D Systems declined to provide guidance with its Q1 results.  Everyday has been downgraded to Hold by Stifel. WiLAN is adding to last week's post-earnings losses.
    • Previously covered: Zulily, Groupon, Axcelis, QuinStreet, Skullcandy, Millennial Media, LendingClub, TechTarget, Anadigics, Zagg, Cray, Enphase,, Jive Software
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  • Tue, Apr. 21, 5:37 PM
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  • Tue, Apr. 21, 4:33 PM
    • CREE is guiding for FQ4 revenue of $420M-$440M and EPS of $0.24-$0.28 vs. a consensus of $434.4M and $0.29.
    • Gross margin (closely watched) fell to 31.4% in FQ3 from 33.9% in FQ2 and 37.8% a year ago, and missed guidance of ~33.5%. FQ4 GM guidance is at ~32%.
    • Segment performance: LED product (chip/component) revenue -23% Y/Y to $154.4M (tough Asian mid-power competition); gross margin -970 bps to 35.9%. Lighting products +27% to $224.1M (strong U.S. retail sales); gross margin -140 bps to 26%. Power/RF products +13% to $31M; gross margin -400 bps to 53.1%.
    • GAAP SG&A spend +10% to $71.9M; R&D -6% to $43.8M. Cree ended FQ4 with $782M in cash/short-term investments, and $150M in long-term debt.
    • Shares have fallen to $33.94 AH.
    • FQ3 results, PR
    | 1 Comment
  • Tue, Apr. 21, 4:02 PM
    • Cree (NASDAQ:CREE): FQ3 EPS of $0.22 misses by $0.01.
    • Revenue of $409.52M (+1.1% Y/Y) beats by $3.75M.
    • Press Release
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Company Description
Cree Inc manufactures lighting-class light emitting diode (LED) products, lighting products andbandgapsemiconductor products for power and radio-frequency (RF) applications.