Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Wolf speed -- Ignore unavailable to you. Want to Upgrade?

To: w2j2 who wrote (6595)	1/16/2003 10:19:07 PM
From: Ron	Read Replies (1) \| Respond to of 10714

Thanks Walter. Sounds like it was a great conference call. Upgrades coming?

To: w2j2 who wrote (6595)	1/17/2003 10:18:40 AM
From: jameswallen	Read Replies (5) \| Respond to of 10714

Everyone should listen. I'll probably listen to it again a couple of times next week. A few observations... Cree has a planning assumption that LED prices will decline by 25%/year. This number is forced on them by the competition, but it critical for growing the market for the devices. Cree reduced manufacturing costs by 8% this quarter, or at the rate of 32%/year. ASP were up this quarter. This implies that Cree's competitive position has improved. In any event, GP margin will be up in the Mar03 quarter. The ending of litigation with Nichia was a huge hunk of change ($2million?). Hence, SGA is down. Also, IP lawsuits take a lot of senior management time, which is now redirected to operations and product development. The guidance is for $59-60M, which is sequential revenue growth >19.8%. EPS forecast is $0.13-0.14 for Mar03. Expect them to beat both figures. Incremental improvements in the brightness of Megabright chips cannibalized some X-Bright sales. However, the XBright chip will be needed to take the market up to the next level. A next-generation SiC MOSFET is coming soon. Cree also expects to sample a GaN power amp. This is a big deal. Such a chip would be able to amplify all frequency bands in a 3G cell phone base station, replacing three traditional power amplifiers. Samsung is bullish on back-light color screens. In their conference call Wednesday, they forecast 40% of their phones sales with color screens. One or two manufacturers expect to market a blue-ray device this calendar year. These devices will be targeted to the broadcast industry and will be a low volume product. The automotive segment of the LED business actually grew faster in the Dec02 quarter than handsets. The plant in Durham is very large, with lots of open space to add more capacity, even after the $40M CAPEX last year. Curiously, Cree expects to expand capacity by several times using the current equipment through productivity and yield improvements. Alex Guana did ask some questions about the number of new 10% customers, the number of partners working on the laser with Cree, design wins, number of reactors, etc. None of the questions showed any insight. I suspect he was in a state of shock. He did say at the end that Cree had a "great quarter." Thanks. Meanwhile, Cree is trading at $18.95 on 2.14M volume. Who in their right mind would be selling today?