Cree, a market leader in LED lighting, announced preliminary estimates of financial results for its third fiscal quarter ended March 27, 2016. Revenue for the quarter is estimated to be approximately US $367 million, with earnings estimated to be ($0.01) loss to $0.01 per diluted share on a GAAP basis, and $0.13 to $0.15 per diluted share on a non-GAAP basis. These preliminary financial results are subject to completion of the Company’s customary quarterly closing and review procedures.

“The estimated revenue is below the Company’s previously targeted range of $400 million to $430 million due to lower Lighting Products revenue,” stated Chuck Swoboda, Cree Chairman and CEO. “I believe we’ve addressed the root causes that led to our recent business challenges. While it’s premature to provide specific targets at this time, the order rate in commercial lighting improved in March, and we’re optimistic that this, combined with demand for new products, will begin to drive growth in fiscal Q4.”

Lighting Products revenue is estimated to be approximately $187 million, lower than previously targeted due primarily to lower commercial orders driven by three main factors: customer service disruptions related to our ERP system conversion, new product delays and a slower than forecast calendar Q1.

• LED Products revenue is estimated to be in-line with the expectations for this segment in the Company’s previously announced revenue targets at approximately $151 million.
• Power and RF Products revenue is estimated to be in-line with the expectations for this segment in the Company’s previously announced revenue targets at approximately $29 million.
• GAAP and non-GAAP gross margins are estimated to be below the Company’s previously announced targets at approximately 29.7% and 30.5%, respectively. The difference between GAAP and non-GAAP gross margin is stock-based compensation expense.
• GAAP and non-GAAP operating expenses are estimated to be $5 million lower than previously targeted. The difference between non-GAAP and GAAP operating expenses is stock-based compensation expense, amortization of acquired intangibles and income from equipment sales associated with the LED business restructuring.
• The estimated earnings are below the Company’s previously targeted range of $0.04 to $0.11 per diluted share on a GAAP basis, and $0.22 to $0.29 per diluted share on a non-GAAP basis.
• During its third fiscal quarter the Company repurchased 0.6 million shares of its common stock under the Company’s stock repurchase program at an average price of $28.15 per share with an aggregate value of $17.8 million. After this repurchase, there is $350 million in aggregate purchase price value remaining in the Company’s stock repurchase program through June 26, 2016.