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Cree Reports Financial Results for the Fourth Quarter and Fiscal Year 2013



  Cree Reports Financial Results for the Fourth Quarter and Fiscal Year 2013

            Annual Revenue Increased 19% to a Record $1.4 Billion
               Annual Net Income Increased 96% to $86.9 Million

Business Wire

DURHAM, N.C. -- August 13, 2013

Cree, Inc. (Nasdaq: CREE), a market leader in LED lighting, today announced
revenue of $375.0 million for its fourth quarter of fiscal 2013, ended
June 30, 2013. This represents a 22% increase compared to revenue of $306.8
million reported for the fourth quarter of fiscal 2012, and a 7% increase
compared to the third quarter of fiscal 2013. GAAP net income for the fourth
quarter was $28.2 million, or $0.23 per diluted share, an increase of 182%
year-over-year compared to GAAP net income of $10.0 million, or $0.09 per
diluted share, for the fourth quarter of fiscal 2012. On a non-GAAP basis, net
income for the fourth quarter of fiscal 2013 was $45.6 million, or $0.38 per
diluted share, an increase of 56% year-over-year compared to non-GAAP net
income for the fourth quarter of fiscal 2012 of $29.2 million, or $0.25 per
diluted share.

For fiscal year 2013, Cree reported revenue of $1.39 billion, which represents
a 19% increase compared to revenue of $1.16 billion for fiscal 2012. GAAP net
income was $86.9 million, or $0.74 per diluted share, an increase of 96%
compared to $44.4 million, or $0.39 per diluted share, for fiscal 2012. On a
non-GAAP basis, net income for fiscal year 2013 was $155.4 million, or $1.32
per diluted share, an increase of 42% compared to $109.2 million, or $0.95 per
diluted share, for fiscal 2012. Cree generated $285.2 million of operating
cash flow and $186.9 million of free cash flow (cash flow from operations less
capital expenditures) during fiscal 2013.

"Our fiscal fourth quarter was a strong finish to a great year, with record
revenue and good earnings growth in line with our targets," stated Chuck
Swoboda, Cree Chairman and CEO. "Total company backlog is ahead of this point
last quarter and we are targeting solid growth in LED lighting in Q1. Our new
products have opened new applications, improved payback, and fueled growth in
LED lighting. We remain focused on driving mass adoption and our goal of 100%
upgrade to LED lighting."

Q4 2013 Financial Metrics
                                                                        
(in thousands, except per share
amounts and percentages)
                                                                          
                                 Fourth Quarter
                                 2013          2012          Change
                                 (unaudited)   (unaudited)
Revenue, net                     $ 375,009     $ 306,759     $ 68,250    22  %
GAAP
Gross margin                     37.5      %   34.8      %
Operating margin                 8.2       %   2.8       %
Net income                       $ 28,242      $ 10,026      $ 18,216    182 %
Earnings per diluted share       $ 0.23        $ 0.09        $ 0.14      156 %
Non-GAAP
Gross margin                     38.2      %   36.3      %
Operating margin                 13.7      %   9.8       %
Net income                       $ 45,645      $ 29,194      $ 16,451    56  %
Earnings per diluted share       $ 0.38        $ 0.25        $ 0.13      52  %

  * Gross margin decreased 60 basis points from Q3 of fiscal 2013 to 37.5% on
    a GAAP basis, and decreased 60 basis points to 38.2% on a non-GAAP basis.
  * Cash and investments increased by $86.9 million from Q3 of fiscal 2013 to
    $1.0 billion.
  * Accounts receivable, net increased by $10.6 million from Q3 of fiscal 2013
    to $192.5 million, with days sales outstanding of 46.
  * Inventory increased by $1.3 million from Q3 of fiscal 2013 to $197.0
    million and represents 76 days of inventory.

Recent Business Highlights:

  * Introduced our new XSPR^™ LED Residential Street Light, a breakthrough in
    LED outdoor lighting as the first $99 LED street light that is targeted to
    compete head to head with low-cost traditional street lights in
    residential applications;
  * Introduced our new UR Series LED Upgrade Kit that can deliver payback in
    less than two years and makes upgrading to LED lighting from linear
    fluorescent lamps simple and easy;
  * Released the XLamp^® XH Series LEDs, the first family of mid-power,
    ceramic LEDs that offer no-compromise performance and reliability;
  * Launched the Cree^® LED BR30 Flood Light, an extension of our series of
    LED bulbs designed to help accelerate the consumer lighting revolution by
    saving money and reducing energy consumption;
  * Expanded the industry-leading CXA LED family with new 95-CRI options.
    Delivering up to twice the efficacy of equivalent-CRI LED light sources,
    the new CXA options deliver halogen-like color and push the boundaries of
    lighting-class performance;
  * Announced that the University of North Carolina General Administration has
    selected high-performing lighting by Cree as part of its ongoing efforts
    to reduce energy usage by at least $25 million over seven years.

Business Outlook:

For its first quarter of fiscal 2014 ending September 29, 2013, Cree targets
revenue in a range of $380 million to $400 million, with GAAP gross margin
targeted to be 38.5%+/- and non-GAAP gross margin targeted to be 39%+/-. Our
GAAP gross margin targets include stock-based compensation expense of
approximately $2.2 million, while our non-GAAP targets do not. Operating
expenses are targeted to increase by approximately $3 million sequentially on
both a GAAP and non-GAAP basis. The tax rate is targeted at 23.0% for the
first quarter of fiscal 2014. GAAP net income is targeted at $28 million to
$34 million, or $0.23 to $0.28 per diluted share. Non-GAAP net income is
targeted in a range of $44 million to $50 million, or $0.36 to $0.41 per
diluted share. The GAAP and non-GAAP net income targets are based on an
estimated 122.4 million diluted weighted average shares. Targeted non-GAAP
earnings exclude expenses related to the amortization of acquired intangibles
and stock-based compensation expense of $0.13 per diluted share.

Quarterly Conference Call:

Cree will host a conference call at 5:00 p.m. Eastern time today to review the
highlights of the fourth quarter and fiscal year 2013 results and the fiscal
first quarter 2014 business outlook, including significant factors and
assumptions underlying the targets noted above.

The conference call will be available to the public through a live audio web
broadcast via the Internet. For webcast details, visit Cree's website at
investor.cree.com/events.cfm.

Supplemental financial information, including the non-GAAP reconciliation
attached to this press release, is available on Cree's website at
investor.cree.com/results.cfm.

About Cree, Inc.

Cree is leading the LED lighting revolution and making energy-wasting
traditional lighting technologies obsolete through the use of
energy-efficient, mercury-free LED lighting. Cree is a market-leading
innovator of lighting-class LEDs, LED lighting, and semiconductor products for
power and radio frequency (RF) applications.

Cree's product families include LED fixtures and bulbs, blue and green LED
chips, high-brightness LEDs, lighting-class power LEDs, power-switching
devices and RF devices. Cree's products are driving improvements in
applications such as general illumination, electronic signs and signals, power
supplies and inverters.

For additional product and company information, please refer to www.cree.com.

Non-GAAP Financial Measures:

This press release highlights the company's financial results on both a GAAP
and a non-GAAP basis. The GAAP results include certain costs, charges and
expenses which are excluded from non-GAAP results. By publishing the non-GAAP
measures, management intends to provide investors with additional information
to further analyze the company's performance, core results and underlying
trends. Cree's management evaluates results and makes operating decisions
using both GAAP and non-GAAP measures included in this press release. Non-GAAP
results are not prepared in accordance with GAAP and non-GAAP information
should be considered a supplement to, and not a substitute for, financial
statements prepared in accordance with GAAP. Investors and potential investors
are encouraged to review the reconciliation of non-GAAP financial measures to
their most directly comparable GAAP measures attached to this press release.

Forward Looking Statements:

The schedules attached to this release are an integral part of the release.
This press release contains forward-looking statements involving risks and
uncertainties, both known and unknown, that may cause actual results to differ
materially from those indicated in the forward-looking statements. Actual
results, including with respect to our targets and prospects, could differ
materially due to a number of factors, including the risk that we may not
obtain sufficient orders to achieve our targeted revenues; price competition
in key markets; the risk that we or our channel partners are not able to
develop and expand customer bases and accurately anticipate demand from end
customers, which can result in increased inventory and reduced orders as we
experience wide fluctuations in supply and demand; the risk that our results
will suffer if we are unable to balance fluctuations in customer demand and
capacity; product mix; risks associated with the ramp-up of production of our
new products, and our entry into new business channels different from those in
which we have historically operated; the risk that we may experience
production difficulties that preclude us from shipping sufficient quantities
to meet customer orders or that result in higher production costs and lower
margins; our ability to lower costs; ongoing uncertainty in global economic
conditions, infrastructure development or customer demand that could
negatively affect product demand, collectability of receivables and other
related matters as consumers and businesses may defer purchases or payments,
or default on payments; the risk we may be required to record a significant
charge to earnings if our goodwill or amortizable assets become impaired; our
ability to complete development and commercialization of products under
development, such as our pipeline of improved LED chips, LED components and
LED lighting products; risks resulting from the concentration of our business
among few customers, including the risk that customers may reduce or cancel
orders or fail to honor purchase commitments; risks related to our multi-year
warranty periods for LED lighting products; risks associated with
acquisitions; the rapid development of new technology and competing products
that may impair demand or render our products obsolete; the potential lack of
customer acceptance for our products; risks associated with ongoing
litigation; and other factors discussed in our filings with the Securities and
Exchange Commission (SEC), including our report on Form 10-K for the fiscal
year ended June 24, 2012, and subsequent reports filed with the SEC. These
forward-looking statements represent Cree's judgment as of the date of this
release. Except as required under the U.S. federal securities laws and the
rules and regulations of the SEC, Cree disclaims any intent or obligation to
update any forward-looking statements after the date of this release, whether
as a result of new information, future events, developments, changes in
assumptions or otherwise.

Cree^®, the Cree logo and XLamp^® are registered trademarks, and XSPR^™ is a
trademark, of Cree, Inc.

CREE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share amounts and percentages)

(unaudited)
                                                
                     Three Months Ended          Year Ended
                     June 30,      June 24,      June 30,        June 24,
                                                                
                     2013          2012          2013            2012
                      
Revenue, net         $ 375,009     $ 306,759     $ 1,385,982     $ 1,164,658
Cost of revenue, net 234,284       199,856       862,722         755,196      
Gross profit         140,725       106,903       523,260         409,462
Gross margin         37.5      %   34.8      %   37.8        %   35.2        %
percentage
                                                                  
Operating expenses:
Research and         39,365        36,921        155,889         143,357
development
Sales, general and   61,696        52,303        236,581         197,092
administrative
Amortization of
acquisition-related  7,715         7,614         30,823          26,274
intangibles
Loss on disposal or
impairment of        1,088         1,393         3,473           3,481        
long-lived assets
Total operating      109,864       98,231        426,766         370,204
expenses
                                                                  
Operating income     30,861        8,672         96,494          39,258
Operating income     8.2       %   2.8       %   7.0         %   3.4         %
percentage
                                                                  
Other non-operating  2,685         1,574         11,063          8,389        
income, net
Income from
operations before    33,546        10,246        107,557         47,647
income taxes
Income tax expense   5,304         220           20,632          3,235        
Net income           $ 28,242      $ 10,026      $ 86,925        $ 44,412     
                                                                  
Diluted earnings per $ 0.23        $ 0.09        $ 0.74          $ 0.39
share
                                                                  
Shares used in
diluted per share    121,081       116,243       117,979         115,225
calculation
                                                                              

CREE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)
                                                                  
                                                   June 30,        June 24,
                                                   2013            2012
                                                   (unaudited)
                                                    
ASSETS
Current assets:
Cash, cash equivalents, and short-term investments $ 1,023,915     $ 744,513
Accounts receivable, net                           192,507         152,258
Inventories                                        197,001         188,849
Deferred income taxes                              26,125          21,744
Prepaid expenses and other current assets          76,218          56,917
Total current assets                               1,515,766       1,164,281
Property and equipment, net                        542,833         582,461
Intangible assets, net                             357,525         376,075
Goodwill                                           616,345         616,345
Other assets                                       19,941          8,336
Total assets                                       $ 3,052,410     $ 2,747,498
                                                                    
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable, trade                            $ 121,441       $ 78,873
Accrued salaries and wages                         41,407          29,837
Income taxes payable                               1,315           3,834
Other current liabilities                          43,248          36,633
Total current liabilities                          207,411         149,177
                                                                    
Long-term liabilities:
Deferred income taxes                              25,504          15,609
Other long-term liabilities                        12,843          22,695
Total long-term liabilities                        38,347          38,304
                                                                    
Shareholders’ equity:
Common stock                                       148             144
Additional paid-in-capital                         2,025,764       1,861,502
Accumulated other comprehensive income, net of     8,244           11,133
taxes
Retained earnings                                  772,496         687,238
Total shareholders’ equity                         2,806,652       2,560,017
Total liabilities and shareholders’ equity         $ 3,052,410     $ 2,747,498
                                                                      

CREE, INC.
FINANCIAL RESULTS BY OPERATING SEGMENT
(in thousands, except percentages)
(unaudited)
 
The following table reflects the results of the Company's reportable segments
as reviewed by the
Company's Chief Executive Officer, its Chief Operating Decision Maker or CODM,
for the three months
and year ended June 30, 2013 and the three months and year ended June 24,
2012. The Company does
not review inter-segment revenue when evaluating segment performance and
allocating resources to
each segment. As such, total segment revenue is equal to the Company's
consolidated revenue.
                                                                       
                        Three Months Ended
                        June 30, 2013     June 24, 2012   Change             
LED Products revenue    $  217,413        $ 185,040       $ 32,373      17  %
LED Products percent of 58            %   60          %
revenue
Lighting Products       133,643           100,768         32,875        33  %
revenue
Lighting Products       36            %   33          %
percent of revenue
Power and RF Products   23,953            20,951          3,002         14  %
revenue
Power and RF Products   6             %   7           %    
percent of revenue
Total revenue           $  375,009        $ 306,759       $ 68,250      22  %
                        Year Ended
                        June 30, 2013     June 24, 2012   Change             
LED Products revenue    $  801,483        $ 756,924       $ 44,559      6   %
LED Products percent of 58            %   65          %
revenue
Lighting Products       495,089           334,704         160,385       48  %
revenue
Lighting Products       36            %   29          %
percent of revenue
Power and RF Products   89,410            73,030          16,380        22  %
revenue
Power and RF Products   6             %   6           %    
percent of revenue
Total revenue           $  1,385,982      $ 1,164,658     $ 221,324     19  %
                        Three Months Ended
                        June 30, 2013     June 24, 2012   Change             
LED Products gross      $  99,268         $ 72,323        $ 26,945      37  %
profit
LED Products gross      45.7          %   39.1        %
margin
Lighting Products gross 33,498            30,879          2,619         8   %
profit
Lighting Products gross 25.1          %   30.6        %
margin
Power and RF Products   12,874            10,081          2,793         28  %
gross profit
Power and RF Products   53.7          %   48.1        %
gross margin
Unallocated costs       (4,915        )   (6,380      )   1,465         (23 )%
Consolidated gross      $  140,725        $ 106,903       $ 33,822      32  %
profit
Consolidated gross      37.5          %   34.8        %
margin
                        Year Ended
                        June 30, 2013     June 24, 2012   Change             
LED Products gross      $  344,649        $ 290,642       $ 54,007      19  %
profit
LED Products gross      43.0          %   38.4        %
margin
Lighting Products gross 148,947           103,396         45,551        44  %
profit
Lighting Products gross 30.1          %   30.9        %
margin
Power and RF Products   48,127            32,051          16,076        50  %
gross profit
Power and RF Products   53.8          %   43.9        %
gross margin
Unallocated costs       (18,463       )   (16,627     )   (1,836    )   11  %
Consolidated gross      $  523,260        $ 409,462       $ 113,798     28  %
profit
Consolidated gross      37.8          %   35.2        %
margin

Reportable Segments Description

The Company's LED Products segment includes LED components, LED chips, and SiC
materials. The Company's Lighting Products segment consists of both LED and
traditional lighting systems, with its primary focus on LED lighting. The
Company's Power and RF Products segment includes power devices and RF devices.

Financial Results by Reportable Segment

The Company's CODM reviews gross profit as the lowest and only level of
segment profit. As such, all items below gross profit in the consolidated
statements of income must be included to reconcile the consolidated gross
profit presented in the preceding table to the Company's consolidated income
before taxes.

The Company allocates direct costs and indirect costs to each segment's cost
of revenue. The allocation methodology is based on a reasonable measure of
utilization considering the specific facts and circumstances of the cost being
allocated.

Certain costs are not allocated when evaluating segment performance. These
unallocated costs consist primarily of expenses related to manufacturing
employees, such as stock-based compensation, expenses for profit sharing and
quarterly or annual incentive plans, matching contributions under the
Company's 401(k) Plan and acquisition related costs.

                                  Cree, Inc.
                  Non-GAAP Measures of Financial Performance

To supplement the company's consolidated financial statements presented in
accordance with generally accepted accounting principles, or GAAP, Cree uses
non-GAAP measures of certain components of financial performance. These
non-GAAP measures include non-GAAP net income, non-GAAP earnings per diluted
share, non-GAAP gross margin, non-GAAP operating expenses and free cash flow.

Reconciliation to the nearest GAAP measure of all historical non-GAAP measures
included in this press release can be found in the tables included with this
press release. In this press release, Cree also presents its target for
non-GAAP expenses, which is expenses less stock-based compensation expense,
charges for amortization or impairment of acquired intangibles, acquisition
finished goods inventory step-up, acquisition inventory write-off, and
acquisition costs.

Non-GAAP measures presented in this press release are not in accordance with
or an alternative to measures prepared in accordance with GAAP and may be
different from non-GAAP measures used by other companies. In addition, these
non-GAAP measures are not based on any comprehensive set of accounting rules
or principles. Non-GAAP measures have limitations in that they do not reflect
all of the amounts associated with Cree's results of operations as determined
in accordance with GAAP. These non-GAAP measures should only be used to
evaluate Cree's results of operations in conjunction with the corresponding
GAAP measures.

Cree believes that these non-GAAP measures, when shown in conjunction with the
corresponding GAAP measures, enhance investors' and management's overall
understanding of the company's current financial performance and the company's
prospects for the future, including cash flows available to pursue
opportunities to enhance shareholder value. In addition, because Cree has
historically reported certain non-GAAP results to investors, the company
believes the inclusion of non-GAAP measures provides consistency in the
company's financial reporting.

For its internal budgeting process, and as discussed further below, Cree's
management uses financial statements that do not include stock-based
compensation expense or amortization or impairment of acquired intangible
assets, and the income taxes associated with the foregoing, and also do not
include acquisition finished goods inventory step-up, acquisition inventory
write-off, and acquisition costs. Cree's management also uses non-GAAP
measures, in addition to the corresponding GAAP measures, in reviewing the
company's financial results.

As described above, Cree excludes the following items from one or more of its
non-GAAP measures when applicable:

Stock-based compensation expense. This expense consists of expenses for stock
options, restricted stock and employee stock purchases through its ESPP. Cree
excludes stock-based compensation expenses from its non-GAAP measures
primarily because they are non-cash expenses that Cree does not believe are
reflective of ongoing operating results.

Amortization or impairment of acquired intangible assets. Cree incurs
amortization or impairments of acquired intangible assets in connection with
acquisitions. Cree excludes these items because they arise from Cree's prior
acquisitions and have no direct correlation to the ongoing operating results
of Cree's business.

Ruud Lighting Finished Goods Inventory Step-up. The inventory purchased as
part of the Ruud Lighting acquisition was recorded at fair value at the time
of the acquisition. In particular, the finished goods inventory was valued at
the anticipated customer sales price less cost to sell, which is higher than
the cost to produce the finished goods. Cree refers to the difference between
the fair value and cost to produce as the Ruud Lighting finished goods
inventory step-up. Cree excludes this inventory step-up item as Cree does not
believe this step-up value is reflective of ongoing operating results.

Acquired Inventory write-off. Cree acquired certain inventory with the Ruud
acquisition that has been determined to be not usable. Cree excludes this
expense as Cree does not believe this inventory write-off is reflective of the
ongoing operating results.

Ruud Lighting Acquisition Cost. Cree incurred expenses directly related the
acquisition of Ruud Lighting. These expenses include auditor fees, investment
banking fees, legal fees and other consulting fees incurred to conclude the
acquisition. Cree excludes these expenses as they bear no direct correlation
to the current operating results and are not reflective of the ongoing
operating results.

Income tax effects of the foregoing non-GAAP items. This amount is used to
present each of the amounts described above on an after-tax basis consistent
with the presentation of non-GAAP net income.

Cree expects to incur stock-based compensation expense and amortization of
acquired intangible assets in future periods, including income taxes
associated with all of the foregoing. In addition to the non-GAAP measures
discussed above, Cree also uses free cash flow as a measure of operating
performance. Free cash flow represents operating cash flows less net purchases
of property and equipment and patent and licensing rights. Cree considers free
cash flow to be a liquidity measure that provides useful information to
management and investors about the amount of cash generated by the business
after the purchases of property and equipment, which can then be used to,
among other things, invest in Cree's business, make strategic acquisitions,
strengthen the balance sheet and repurchase stock. A limitation of the utility
of free cash flow as a measure of financial performance is that it does not
represent the total increase or decrease in the company's cash balance for the
period.

CREE, INC.

Reconciliation of GAAP to Non-GAAP Measures

(in thousands, except per share amounts and percentages)

(unaudited)
                                                  
Non-GAAP Gross
Margin
                                                    
                     Three Months Ended            Year Ended
                     June 30,       June 24,       June 30,       June 24,
                     2013           2012           2013           2012
GAAP gross profit    $ 140,725      $ 106,903      $ 523,260      $ 409,462
GAAP gross margin    37.5      %    34.8      %    37.8      %    35.2      %
percentage
Adjustments:
Stock-based          2,514          2,281          9,389          7,712
compensation expense
Acquired inventory   —              2,228          —              2,228
write-off
Ruud Lighting
finished goods       —              —              —              1,482      
inventory step-up
Non-GAAP gross       $ 143,239      $ 111,412      $ 532,649      $ 420,884  
profit
Non-GAAP gross       38.2      %    36.3      %    38.4      %    36.1      %
margin percentage
                                                                             
Non-GAAP Operating
Income
                                                                             
                     Three Months Ended            Year Ended
                     June 30,       June 24,       June 30,       June 24,
                     2013           2012           2013           2012
GAAP operating       $ 30,861       $ 8,672        $ 96,494       $ 39,258
income
GAAP operating       8.2       %    2.8       %    7.0       %    3.4       %
income percentage
Adjustments:
Stock-based          12,955         11,509         53,899         46,393
compensation expense
Amortization of
acquisition-related  7,715          7,613          30,823         26,274
intangible assets
Acquired inventory   —              2,228          —              2,228
write-off
Ruud Lighting        —              —              —              3,069
acquisition costs
Ruud Lighting
finished goods       —              —              —              1,482      
inventory step-up
Total adjustments to
GAAP operating       20,670         21,350         84,722         79,446     
income
Non-GAAP operating   $ 51,531       $ 30,022       $ 181,216      $ 118,704  
income
Non-GAAP operating   13.7      %    9.8       %    13.1      %    10.2      %
income percentage
                                                                             
Non-GAAP Net Income
                                                                             
                     Three Months Ended            Year Ended
                     June 30,       June 24,       June 30,       June 24,
                     2013           2012           2013           2012
GAAP net income      $ 28,242       $ 10,026       $ 86,925       $ 44,412
Adjustments:
Stock-based          12,955         11,509         53,899         46,393
compensation expense
Amortization of
acquisition-related  7,715          7,613          30,823         26,274
intangible assets
Acquired inventory   —              2,228          —              2,228
write-off
Ruud Lighting        —              —              —              3,069
acquisition costs
Ruud Lighting
finished goods       —              —              —              1,482       
inventory step-up
Total adjustments to
GAAP net income      20,670         21,350         84,722         79,446
before provision for
income taxes
Income tax effect *  (3,267     )   (2,182     )   (16,266    )   (14,620    )
Non-GAAP net income  $ 45,645       $ 29,194       $ 155,381      $ 109,238   
                                                                   
Earnings per share
Non-GAAP diluted net $ 0.38         $ 0.25         $ 1.32         $ 0.95
income per share
                                                                   
Shares used in
diluted net income
per share
calculation
Non-GAAP shares used 121,081        116,243        117,979        115,225
*Estimated income tax effect is based upon the
Company's overall consolidated effective tax
rate for the given period.
                                                                              
Free Cash Flow
                                                                              
                     Three Months Ended            Year Ended
                     June 30,       June 24,       June 30,       June 24,
                     2013           2012           2013           2012
Cash flow from       $ 61,164       $ 71,703       $ 285,234      $ 242,280
operations
Less: PP&E spending  (22,062    )   (19,809    )   (77,468    )   (95,015    )
Less: Patents        (5,064     )   (5,245     )   (20,858    )   (17,204    )
spending
Total free cash flow $ 34,038       $ 46,649       $ 186,908      $ 130,061   

Contact:

Cree, Inc.
Raiford Garrabrant
Director, Investor Relations
919-407-7895
Fax: 919-407-5615
investorrelations@cree.com
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