Equipment and Materials ♦ news digest
that we have the appropriate level of capacity at the right time to meet market demand as it increases over the next several years. Throughout 2011, we carefully managed our expense levels and further improved our manufacturing and operating efficiency to keep pace with the pricing requirements of our customers and the sizeable fluctuations in raw materials costs. I am pleased by the way our team executed on its mission in 2011 and believe that we are well positioned for continued growth in 2012,” concluded Young.
AXT estimates revenue for the first quarter for 2012 will be between $21 million and $24 million and that net income per share will be between $0.07 and $0.11. This takes into account the weighted average share count of approximately 33.2 million shares.
LED excess inventory affects Rubicon’s quarter
Revenue decreased both year-over-year and sequentially, largely as a result of weak demand from the LED market
Rubicon Technology, a provider of sapphire substrates and products to the LED, RFIC, semiconductor, and optical industries, has reported financial results for its fourth quarter ended December 31, 2011.
Fourth quarter revenue was $19.4 million, slightly below the range of its management’s November guidance.
Raja Parvez, President and CEO of Rubicon Technologies, commented, “Market conditions were very challenging in the fourth quarter. Demand was limited, for both sapphire wafers and cores, because of excess inventory in the LED supply chain. We are now beginning to see some improvement, however, with orders for two through four inch cores increasing in the first quarter. We have continued to maintain high utilisation of our crystal growth facilities throughout this slowdown because we are confident that demand will be strong in the second half of 2012. The LED industry’s largest potential market, general lighting, is in its infancy, and the more established markets for LEDs such as consumer electronics and the automotive industry have plenty of growth opportunities as well.”
Rubicon previously disclosed that it signed a new agreement with its key customer for six inch polished wafers which outlines a base level of shipments from June through December 2012. The Company’s previous agreement with this customer expired in December 2011. Due to the challenging market conditions, the Company gave certain concessions to this customer in the fourth quarter by reducing the volumes and pricing requirements under the previous contract. Rubicon also provided accommodations to certain other key customers of its two through four inch cores and consequently wrote off $1.7 million of accounts receivable in the fourth quarter.
Gross margin in the fourth quarter was 12.1 percent, which was impacted by reductions in pricing and by lower utilisation of the Company’s
“We have worked very closely with our major customers to help them through this challenging period and to ensure that our relationships
March 2012
www.compoundsemiconductor.net 129
fabrication and polishing operations. Operating loss was $0.7 million, offset by a reduction of the full year tax rate to 30.3 percent, resulting in fourth- quarter earnings of $0.04 per diluted share.
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