Cree Posts Better-than-expected Third Quarter Revenue Due to Growth in LED Lighting

For the third quarter ended March 29, LED products maker Cree reported earnings of $4.0 million, compared with $5.7 million in the year-ago period, which is above market estimates. And the company has forecasted stronger-than-expected revenue for the fourth quarter.

The better-than-expected result has been attributed by the company to the growth in LED lighting segment. As power cost and concerns about greenhouse gas emissions rise, LED fixtures, which feature higher energy efficiency and longer lifespan than traditional incandescent and fluorescent lights, are seen as promising next-generation lights.

"Growth in LED lighting partially offset lower demand for auto, mobile and consumer applications in Q3, and we target total LED revenue to rebound in Q4 driven by increased demand for commercial lighting and video screens," Chief Executive Chuck Swoboda said in a statement.

Cree is aiming at continued growth in its LED lighting and LED component product lines for fiscal 2010, and is planning to continue investing in research and development and capacity to enable the growth, said Swoboda.

For the fourth quarter, Cree is to increase the expense on R&D by about 10 percent as it ramps up spending on LED components and LED lighting, Swoboda said on a conference call with analysts.

Cree's competitors include Japan's Toyoda Gosei Co Ltd (7282.T) and Nichia Corp, as well as Osram, a LED lighting unit of Siemens.

Cree shares gained more than 1 percent at $26.39 after the bell and closed on Nasdaq at $26.06 Tuesday.

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