Dec. 22, 2014, 3:51 PM
- Taiwanese LED industry sources tell Digitimes the Chinese government "has ordered its subordinate agencies and local governments to stop offering subsidies and tax incentives for China-based LED epitaxial wafer and chip makers because such offering has disrupted market mechanisms and may violate WTO rules."
- Cree (CREE +3%), which has lost mid-power LED chip share to low-cost Chinese manufacturers, could benefit from the ending of subsidies. As might Taiwan's SemiLEDs (LEDS +6.3%) and U.S. LED wafer supplier Rubicon (RBCN -3.5%).
- On the other hand, equipment suppliers Veeco (VECO +2%) and Aixtron (AIXG -1.2%) could see their Chinese orders slump. Aixtron soared in September after landing a major order from Chinese LED chipmaker San'an Optoelectronics. Digitimes notes San'an has received generous subsidies from the Xiamen city government, and has placed major orders with both Aixtron and Veeco.
Nov. 7, 2014, 4:57 PM
- Initially lower after posting mixed Q3 results and once more providing a downbeat outlook, Rubicon (NASDAQ:RBCN) finished the day up 9.6%.
- The sapphire wafer vendor notes industry oversupply led pricing for 2" core wafers to fall 30% Q/Q in Q3. It's seeing "increasing interest in two-inch material" in Q4, but also declares 4" demand to be "very weak" due to above-normal LED backlighting market seasonality.
- Q4 revenue is expected to be "similar" to a Q3 level of $8M; that puts it below an $11.5M consensus. EPS is expected to be in a range of -$0.38 to -$0.42, below a -$0.35 consensus. Rubicon expects revenue to rise in Q1 2015, aided by improving 4" wafer demand.
- A $9.5M gross loss was seen in Q3 on $8M in revenue. GAAP opex rose 34% Y/Y to $4.4M.
- Rubicon ended Q3 with $53M in cash/investments (compares with a $115M market cap), and no debt.
- Q3 results, PR
Oct. 22, 2014, 2:50 PM
- Canaccord and D.A. Davidson have downgraded Cree (CREE -16.7%) to neutral ratings after the company offered a weaker-than-expected FQ2 outlook and reported a 580 bps Q/Q gross margin drop.
- Canaccord's Jonathan Dorsheimer, who wasn't quite enthusiastic about reiterating a Buy following Cree's Oct. 2 FQ1 warning: "In spite of the fact that we may be...marking the bottom for CREE shares, we simply fail to see a potentially positive catalyst ... Our thesis was based around the transition from captive to merchant sales in Cree’s components [business], which at best has been pushed by 6-9 months now."
- He adds Canaccord's research confirms Cree has lost LED component share to Philips' Lumileds unit, and that a shift towards mid-power LED sales in China is also taking a toll.
- Cowen's Jeffrey Osborne (Market Perform) thinks margins will stabilize as Cree cuts factory output, continues seeing healthy lighting and power/RF growth, and gets a lighting margin boost from a mix shift to non-bulb lighting products. He's still cautious on account of Cree's near-term LED component challenges, but expects the company's technology strengths will help its cause long-term.
- Fellow LED industry names Rubicon (RBCN -2.3%), Veeco (VECO -3.7%), and Aixtron (AIXG -2.5%) are also lower.
Oct. 10, 2014, 12:45 PM
Oct. 7, 2014, 5:40 PM
Oct. 7, 2014, 12:45 PM
Oct. 7, 2014, 10:31 AM
- With GT Advanced having filed for bankruptcy, speculation that Rubicon's (NASDAQ:RBCN) sapphire materials could be used to pick up the slack has grown
- Though best known for its wafers, a page on Rubicon's site notes the company also provides 2" sapphire ingots for camera lens cover and biometric applications, as well as "rectangular blocks ready to be sliced into smartphone faceplates and custom shapes such as smart-watch face plates." (h/t Notable Calls)
- Also: If GT Advanced's sapphire capacity was removed from the market (remains to be seen), Rubicon could benefit from the diminished industry supply even in the absence of an Apple deal.
- Apple is using sapphire cover glass for two of its three smartwatch models, but opted against using it on the iPhone 6, reportedly due to technical shortcomings.
- Rubicon has recovered most of the Monday losses it saw in response to GT's filing. Shares dove to a new 52-week low of $3.56 yesterday before bouncing.
Oct. 6, 2014, 12:46 PM
Oct. 6, 2014, 10:41 AM
Aug. 8, 2014, 12:47 PM
Aug. 7, 2014, 5:36 PM
Aug. 7, 2014, 5:19 PM
- Though Rubicon (NASDAQ:RBCN) beat Q2 estimates, it's guiding for Q3 revenue of $8M-$12M and EPS of -$0.39 to -$0.44, far below a consensus of $16.3M and -$0.27.
- The company says it's seeing "very little demand" in Q3 for 2" core sapphire wafers due to excess inventory among polishing clients. It also thinks "recent capacity additions in the sapphire market" related to mobile devices are "temporarily impacting" 2" demand. That's almost certainly a reference to GT Advanced (NASDAQ:GTAT) and its huge sapphire production efforts for Apple.
- 2" demand is expected to improve in Q4. Rubicon also says it's upbeat about initial qualification of its PSS wafers at 3 new clients.
- Q2 gross margin was -50.2% (a $7.3M gross loss on revenue of $14.5M). Rubicon notes 4" core wafer pricing rose 10% Q/Q amid strong LED market demand, but added "idle plant and development costs at our wafering facility continued to be a drag on earnings."
- Q2 results, PR
Jul. 7, 2014, 12:50 PM
- "We believe GT can still hit the midpoint of its sales guidance of $600-$800M but believe our checks of a slower ramp in 2Q14 makes the high end more challenging," writes UBS' Stephen Chin while downgrading GT Advanced (GTAT -13%) to Neutral.
- Chin is worried about the pace at which Apple-related sapphire output is growing, and has respectively cut his 2014 revenue and EPS forecasts by $100M and $0.05 to $700M and $0.12. Consensus is at $696.5M (+133% Y/Y) and $0.08.
- Canaccord's Jonathan Dosheimer, who this morning cut GT to Hold, expresses skepticism the iPhone 6 will use sapphire cover glass in large volumes, and considers 2016 EPS upside unlikely unless sapphire cover glass is used across Apple's iPhone/iWatch lineups.
- Dorsheimer's remarks follows a June report claiming only the 5.5" iPhone 6 will feature sapphire cover glass - the 4.7" model will use Gorilla Glass - and that the 5.5" model will be in short supply through year's end due to sapphire yield issues.
- Sapphire wafer vendor Rubicon (RBCN -5.9%) is following GT lower on a weak day for tech. GT is still up 95% YTD.
May. 23, 2014, 1:45 PM
- Korea's ETNews.com reports Samsung (SSNLF) and LG (LGEIY) are interested in adopting sapphire cover glass for their phones, and recently asked sapphire wafer/ingot makers to submit samples.
- The site adds the companies were previously reluctant to adopt sapphire due to its steep cost, but have changed their minds following Apple's embrace of the technology.
- Like much of the industry, Samsung/LG have been avid users of Corning's (GLW +0.5%) Gorilla Glass. Sapphire cover glass is thinner, stronger, and more scratch-resistant than Gorilla Glass, but also much more costly for now. Samsung took a 7.4% stake in Corning last year as part of a deal to sell its stake in the Samsung Corning JV.
- GT Advanced (GTAT +8%), currently quite busy ramping sapphire production for Apple, has shot higher on the report. Though GT has said its Apple deal "will be subject to certain exclusivity terms during the duration of the agreement," there could still be a long-term opportunity to service other OEMs. Moreover, stronger industry demand stands to improve GT's pricing power.
- SA author Matt Margolis notes the Apple exclusivity deal doesn't cover GT's sapphire laminate solutions (enabled by its Hyperion tech).
- Sapphire wafer vendor Rubicon (RBCN +4.8%) is also up sharply, aided by an Oppenheimer upgrade.
May. 23, 2014, 9:21 AM
- Citing valuation, Oppenheimer has upgraded Rubicon (RBCN) to Perform.
- The beaten-down/heavily-shorted sapphire wafer maker closed yesterday not far from its 52-week low of $6.84, after getting crushed at the beginning of the month due to an EPS miss and poor guidance.
- Dougherty started coverage on Rubicon with a Buy on May 13, while predicting a big top-line improvement.
May. 13, 2014, 12:42 PM
- Dougherty has started coverage on GT Advanced (GTAT +3.4%) and Rubicon (RBCN +3.1%) at Buy. The firm has set a $27 PT for the former, and an $11 PT for the latter.
- Dougherty is upbeat about GT's Apple deal and new products, and expects long-struggling Rubicon to post strong top-line growth going forward on the back of healthy LED/smartphone sapphire demand.
- GT sold off last week after missing Q1 revenue estimates and reiterating full-year guidance. Rubicon tumbled two weeks after posting mixed Q1 results and below-consensus Q2 guidance.
- 29% and 30% of GT and Rubicon's floats were respectively shorted as of April 30.
RBCN vs. ETF Alternatives
Rubicon Technology, Inc., is an electronic materials provider that develops, manufactures and sells monocrystalline sapphire and other innovative crystalline products for LEDs, RFICs, blue laser diodes, optoelectronics and other optical applications.
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