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CREE's Q4 Earnings and Revenues Surpass Estimates, Rise Y/Y
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Cree reported fourth-quarter fiscal 2021 non-GAAP loss of 23 cents per share, which was narrower than the Zacks Consensus Estimate of a loss of 25 cents. The company had reported a loss of 27 cents per share in the year-ago quarter.
Revenues of $145.8 million surpassed the consensus mark by 0.27% and grew 34.5% year over year.
Quarter Details
Cree witnessed strong demand for its power product line in the reported quarter. Power device revenues jumped 46% year over year.
Revenues suffered from supply constraints due to COVID-19-induced temporary closure of a contract manufacturing facility Cree uses in Malaysia.
RF revenues increased due to heightened 5G activity as communications infrastructure providers continue to support the rollout by carriers.
Production shutdown in Malaysia weighed on non-GAAP gross margin, which came at 32.2%, expanding 230 basis points (bps) on a year-over-year basis, but was in the low-end of management’s 32-34% guidance range.
Non-GAAP operating loss during the quarter was $35.4 million compared with operating loss of $39.9 million in the year-ago quarter.
Balance Sheet & Cash Flow
Cree had cash, cash equivalents & short-term investments of $1.15 billion as of Jun 27, 2021 compared with $1.29 billion as of Mar 28, 2021.
During the fiscal fourth quarter, cash utilized by operating activities was $112.5 million compared with $26.8 million used in the previous quarter.
Free cash outflow was $221.7 million, compared with free cash outflow of $165 million in the previous quarter.
Guidance
For first-quarter fiscal 2022, Cree expects revenues in the range of $144 million to $154 million.
Non-GAAP gross margin is expected between 31.5% and 33.5%. Non-GAAP operating expenses are expected to be $85 million.
Non-GAAP operating loss is expected between $34 million and $40 million. Non-GAAP loss is projected to be 21-25 cents per share.
For fiscal 2022, Cree anticipates start-up costs to be approximately $80 million, of which $60 million will be cash-related costs. The company anticipates that more than 50% of these costs will be incurred in the second half of fiscal year 2022.
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CREE's Q4 Earnings and Revenues Surpass Estimates, Rise Y/Y
Cree reported fourth-quarter fiscal 2021 non-GAAP loss of 23 cents per share, which was narrower than the Zacks Consensus Estimate of a loss of 25 cents. The company had reported a loss of 27 cents per share in the year-ago quarter.
Revenues of $145.8 million surpassed the consensus mark by 0.27% and grew 34.5% year over year.
Quarter Details
Cree witnessed strong demand for its power product line in the reported quarter. Power device revenues jumped 46% year over year.
Revenues suffered from supply constraints due to COVID-19-induced temporary closure of a contract manufacturing facility Cree uses in Malaysia.
Cree, Inc. Price, Consensus and EPS Surprise
Cree, Inc. price-consensus-eps-surprise-chart | Cree, Inc. Quote
RF revenues increased due to heightened 5G activity as communications infrastructure providers continue to support the rollout by carriers.
Production shutdown in Malaysia weighed on non-GAAP gross margin, which came at 32.2%, expanding 230 basis points (bps) on a year-over-year basis, but was in the low-end of management’s 32-34% guidance range.
Non-GAAP operating loss during the quarter was $35.4 million compared with operating loss of $39.9 million in the year-ago quarter.
Balance Sheet & Cash Flow
Cree had cash, cash equivalents & short-term investments of $1.15 billion as of Jun 27, 2021 compared with $1.29 billion as of Mar 28, 2021.
During the fiscal fourth quarter, cash utilized by operating activities was $112.5 million compared with $26.8 million used in the previous quarter.
Free cash outflow was $221.7 million, compared with free cash outflow of $165 million in the previous quarter.
Guidance
For first-quarter fiscal 2022, Cree expects revenues in the range of $144 million to $154 million.
Non-GAAP gross margin is expected between 31.5% and 33.5%. Non-GAAP operating expenses are expected to be $85 million.
Non-GAAP operating loss is expected between $34 million and $40 million. Non-GAAP loss is projected to be 21-25 cents per share.
For fiscal 2022, Cree anticipates start-up costs to be approximately $80 million, of which $60 million will be cash-related costs. The company anticipates that more than 50% of these costs will be incurred in the second half of fiscal year 2022.
Zacks Rank & Stocks to Consider
Cree currently has a Zacks Rank #3 (Hold).
Better-ranked stocks in the broader technology sector include Apple (AAPL - Free Report) , Avnet (AVT - Free Report) and Carrier Global (CARR - Free Report) . All the three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rate for Apple, Avnet and Carrier Global is 12.7%, 25.4% and 14.5%, respectively.