Credence Exits Stage Left CMOS
Credence Systems (CMOS), which provides test solutions from design-to-production for the worldwide semiconductor industry, announced for its fiscal Q2, ending April 30. The numbers were good, but the news was bad.
Revenue rose to $124.8 million from $101.9 a year ago. The company's operating loss improved to $12.8 million from $18.2 million. But, the company had $11.8 million in inventory write-off, and that was the rub. The company is dropping its next-generation memory product due to lack of demand and will fall back on mixed-signal and wireless products. Credence had been pushing the next-generation Kalos 2 system hard.
The company papered the announcement this way: "We are redirecting our resources on opportunities identified in our higher return consumer market segment," said John Batty, chief financial officer of Credence Systems Corporation. "We believe these actions will allow us to concentrate on those market segments that will improve the Company's financial performance and stability long-term. By placing more resources on our digital and mixed-signal business the Company can accelerate development programs more effectively to compete in the emerging consumer-mobile market."
In other words, the Credence will need to substantially transform its business as it changes direction.
The company's shares are down 17% in the pre-market at $5.31, which would be a new 52-week low. The high is $11.27.
But, with the challenge ahead, Credence could go lower still.
Douglas A. McIntyre
Revenue rose to $124.8 million from $101.9 a year ago. The company's operating loss improved to $12.8 million from $18.2 million. But, the company had $11.8 million in inventory write-off, and that was the rub. The company is dropping its next-generation memory product due to lack of demand and will fall back on mixed-signal and wireless products. Credence had been pushing the next-generation Kalos 2 system hard.
The company papered the announcement this way: "We are redirecting our resources on opportunities identified in our higher return consumer market segment," said John Batty, chief financial officer of Credence Systems Corporation. "We believe these actions will allow us to concentrate on those market segments that will improve the Company's financial performance and stability long-term. By placing more resources on our digital and mixed-signal business the Company can accelerate development programs more effectively to compete in the emerging consumer-mobile market."
In other words, the Credence will need to substantially transform its business as it changes direction.
The company's shares are down 17% in the pre-market at $5.31, which would be a new 52-week low. The high is $11.27.
But, with the challenge ahead, Credence could go lower still.
Douglas A. McIntyre
posted by douglas mcintyre at 9:12 AM
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