Gorilla and King Portfolio Candidates Message Board

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Strategies & Market Trends : Gorilla and King Portfolio Candidates

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To: 100cfm who wrote (13999)	1/3/2000 7:21:00 PM
From: unclewest	Read Replies (1) of 54805

1. 10% of revenue in 99 was from research grants. Do you see that continuing? short term...yes long term...i don't know 2. 20% of revenue was from C3. C3's purchase obligation expires in june. This is particularly disconcerting because C3's product is not faring well in the market place. Do you see Cree picking up the slack elsewhere?(ie:with increased LED demand). ceo has stated twice that cree has lots of places to put cthr's SiC, if cthr backs up. i am not certain that i agree quite yet with your assessment of cthr...you may be right...i do not think it will matter to cree. in fact cree may be able to funnel the production to higher margin products. i believe cthr was 15% last quarter, may be less now. 3. Since Sic is so difficult to produce(which is why cree is so interesting) what is Sic's scalability, do you see the yields increasing to the point that it can be produced in mass Quantities to meet a mass market adoption. I realise that more growers producing bigger wafers increase quantities but if the market were to utilize Sic's full potential the demand could be incredible to the point that i wonder if the number of growers needed would be ridiculous. cree has said that they believe they can increase yield from current wafers by 400%. also cree has recently switched from 2" to 3" crystals and demonstrated 4", and stated they believe 10-12" are quite feasible. figure the square area and you will find the progression is geometric. 4. The three Sic growers that Cree is presently using are owned by C3. Will Cree be able to purchase or lease them if C3 does not extend the purchase agreement. I ask this in case there is a gap between the time their new plants are online and the end of the C3 agreement. Revenues could take a temporary hit(which could be a great buying opp.) cthr has paid for a few growers...i believe the contracts are such that cree can sell production anywhere if cthr does not buy. remember cree is a production constrained company. the two new factories due in june and october will help. cree still owns quite a bit of land suitable for greater expansion...we should get details tomorrow at the conference call. oh damn...i lost the shift key!

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