Cree of Durham, North Carolina, posted a record annual revenue of $423 million
for fiscal 2006, despite a fourth quarter earnings drop about 37 percent compared
to the Q4 of 2005. The company reported a profit of $13.2 million. That’s
down from $21 million from the same quarter in 2005. July warnings of lower
than expected earnings sent stocks share prices plunging to as low as $16.95.
The stock has gradually recovered from the bad news in July. Cree cited production
challenges of LEDs as the primary cause of the lower sales.
“Although the fourth quarter was more challenging than we expected,
we remain optimistic that we can expand our business by leveraging strengths
in LED chip and (silicon carbide) materials technology to broaden our product
line with higher-value, component-level products for the emerging markets in
LED lighting and power,” said Cree Chief Executive Officer Chuck
Swoboda in a statement. Cree opened a new silicon carbide (SiC) and gallium
nitride (GaN) production facility in Research Triangle Park on Tuesday. The
additional GaN and SiC production capacity is expected to help alleviate the
LED production capacity problem. (Ref: Company