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Cree to close silicon microwave business

Posted: 06 Jun 2005 ?? ?Print Version ?Bookmark and Share

Keywords:rf? silicon radio? microwave semiconductor? sic? gan?

Cree Inc. has announced it would close the unprofitable silicon radio frequency (RF) and microwave semiconductor business of its subsidiary Cree Microwave Inc., to focus on silicon carbide (SiC) and gallium nitride (GaN) RF and microwave products.

Cree operates a plant in Sunnyvale, Calif., to manufacture silicon microwave semiconductors using laterally-diffused metal oxide semiconductor (LDMOS) technology. Cree Microwave will accept last time buy orders for its silicon LDMOS products through June and close the Sunnyvale facility in December.

According to a report, Cree is slated to lay off 80 employees located at the Sunnyvale plant.

Although Cree reported a year-over-year sales gain in its most recent fiscal quarter ended March 27, the company's silicon microwave business has been unprofitable. For the nine months ended March 27, Cree incurred pre-tax operating losses of $9.2 million in this segment of its business.

Cree expects to incur $13 million to $15 million in pre-tax expenses to close the Sunnyvale facility, including $1.8 million to $1.9 million for severance and other employee-related costs, $6 million to $8 million in impairment charges related to inventory and equipment, and $4.7 million for lease obligations.

The company expects to record $7 million to $9 million of these charges in the fourth fiscal 2005 quarter ending June, with the remaining charges slated for recording the first and second quarters of fiscal 2006.

Cree will continue to apply the Cree Microwave brand name to wide bandgap RF and microwave products based on SiC and GaN technology. The company will also move production of Schottky diodes recently qualified in Sunnyvale to Durham later this year.

- Spencer Chin

EE Times

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