Cree lowers financial targets for 3Q

Gross margin for the quarter is expected to be approximately 43%. The decline in gross margin targets is attributable primarily to increased pricing pressure in the LED chip product line. Operating expenses are expected to be slightly lower than previously targeted. "The LED components business appears to be turning the corner. Despite the challenges we faced in Q3, distributor sell-through has improved and we target solid growth next quarter. Based on our preliminary outlook for Q4, we are currently targeting revenue to increase 10 to 12% in fiscal Q4 led by growth in LED components", stated Chuck Swoboda, Cree’s CEO and chairman.