DURHAM, N.C. — Cree, Inc. announced revenue of $239.9 million for its second quarter of fiscal 2020, ended December 29, 2019. This represents a 14% decrease compared to revenue of $280.5 million reported for the second quarter of fiscal 2019, and a 1% decrease compared to the first quarter of fiscal 2020. GAAP net loss from continuing operations attributable to controlling interest for the second quarter was $52.8 million, or $0.49 per diluted share, compared to GAAP net loss from continuing operations attributable to controlling interest of $0.2 million, or $0.00 per diluted share, for the second quarter of fiscal 2019. On a non-GAAP basis, net loss from continuing operations attributable to controlling interest for the second quarter of fiscal 2020 was $10.4 million, or $0.10 per diluted share, compared to non-GAAP net income from continuing operations attributable to controlling interest for the second quarter of fiscal 2019 of $21.9 million, or $0.21 per diluted share. GAAP and non-GAAP net losses from continuing operations attributable to controlling interest for the second quarter of fiscal 2020 include a $8.3 million reserve on inventory related to Huawei. As a result of the reserve on inventory related to Huawei, net losses per share from continuing operations attributable to controlling interest on a GAAP and non-GAAP basis increased by $0.08 and $0.05, respectively.
“We continue to see growing momentum for silicon carbide as demonstrated by our robust opportunity pipeline and recent customer wins,” said Cree CEO Gregg Lowe. “While we continue to navigate a challenging operating environment in the short-term, we continue to invest for the future to support several growth opportunities across multiple sectors.”
Business Outlook
For its third quarter of fiscal 2020, Cree targets revenue in a range of $221 million to $229 million. GAAP net loss is targeted at $68 million to $62 million, or $0.63 to $0.57 per diluted share. Non-GAAP net loss is targeted to be in a range of $16 million to $10 million, or $0.15 to $0.09 per diluted share. These targets reflect the January 27, 2020 decision by the Chinese government to extend the Lunar New Year holiday due to the coronavirus outbreak. Targeted non-GAAP loss excludes $52 million of estimated expenses, net of tax, related to stock-based compensation expense, amortization or impairment of acquisition-related intangibles, factory optimization restructuring and start-up costs, accretion on convertible notes, and project, transformation and transaction costs. The GAAP and non-GAAP targets do not include any estimated change in the fair value of Cree’s Lextar investment.
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