Chairman and CEO Chuck Swoboda to Step Down
Upon the Appointment of His Successor
Company Reaffirms Guidance for the Fourth
Fiscal Quarter of 2017
Cree, Inc. (Nasdaq: CREE), a technology market leader, today
announced that Chairman, President and CEO Chuck Swoboda will step
down from his executive positions and as a member of the Board of
Directors following a transition period. Mr. Swoboda intends to
stay on until a successor is appointed, and thereafter will remain
available as a consultant to the Company to ensure a seamless
transition of leadership responsibilities.
The Board of Directors will retain a leading executive search
firm to identify a successor. Both internal and external candidates
will be considered.
Since joining Cree in 1993, Mr. Swoboda has held numerous
executive positions with the Company, leading Cree from a near
start-up to today’s technology market leader, with approximately
6,400 employees worldwide. Mr. Swoboda has served as a member of
the Cree Board of Directors since 2000, as chief executive officer
since 2001, and Chairman of the Board since 2005. In 2010, Mr.
Swoboda was named Ernst & Young’s Entrepreneur of the Year for
the Carolinas, and in 2013 he was named The Edison Report’s
Lighting Industry Person of the Year. Cree was recognized as one of
MIT Technology Review’s 50 Smartest Companies for 2014, and as one
of Fast Company’s World’s 50 Most Innovative Companies in 2015.
Mr. Swoboda stated, “I have had the privilege of leading Cree
for 16 years, which has been extremely rewarding both
professionally and personally. My decision to change my work-life
balance follows a recent medical issue, which was resolved, and
which caused me to reevaluate my priorities.”
Mr. Swoboda added, “I believe that this is a good transition
time for Cree as we have three core businesses poised to enter
another phase of accelerated growth. I know that under its next
CEO, Cree will continue to disrupt markets with new technologies
and superior-performing products that deliver great value to our
customers while consuming less energy. I look forward to working
with the Cree Board to find the right leader and to ensure a smooth
handoff to my successor.”
Robert A. Ingram, Lead Independent Director of the Cree Board of
Directors, said, “The Board extends its deep appreciation to Chuck
for his outstanding leadership over the past 16 years as CEO, and
for his 24 years of service to Cree. During that time, his passion
for the business and focus on innovation has helped transform
industries and has enabled the Company to achieve an eight-fold
increase in revenue.”
Mr. Ingram concluded, “Given Chuck’s decision, he and the rest
of the Board agree that now is the right time to accelerate the
process to identify a new CEO to lead Cree and further grow our
three businesses. We look forward to Chuck’s continued leadership
as we conduct our CEO search and transition.”
The Company today also reaffirmed its previously announced
business outlook for the fourth quarter of fiscal 2017 ending June
25, 2017. As announced on April 25, 2017, for the fourth quarter
Cree targets:
- Revenue in a range of $340 million to
$360 million.
- GAAP net loss of $16 million to $22
million, or a $0.16 to $0.23 loss per diluted share.1,3
- Non-GAAP net income in a range of $2
million to $7 million, or $0.02 to $0.07 per diluted
share.1,2,3
1 Cree’s fourth quarter GAAP and non-GAAP targets include $3
million+/- of expenses related to non-recurring costs from the
Company’s Lighting Products business right-sizing initiatives and
joint venture start-up costs.2 Targeted non-GAAP income excludes
$23 million, net of tax, of expenses related to stock-based
compensation expense and the amortization or impairment of
acquisition-related intangibles.3 The GAAP and non-GAAP targets do
not include any estimated change in the fair value of Cree’s Lextar
investment.
About Cree, Inc.
Cree is a leading innovator of lighting-class LEDs, lighting
products and wide bandgap semiconductor products for power and
radio frequency (RF) applications. Cree’s product families include
LED lighting systems and bulbs, blue and green LED chips,
high-brightness LEDs, lighting-class power LEDs, SiC materials,
power devices and RF devices. Cree’s products are driving
improvements in applications such as commercial and consumer
general illumination, video screens, electronic signs and signals,
motor drives, power supplies, EV charging, solar, traction,
transportation, radar, communications, telecom, data link and
broadband amplifiers.
For additional product and Company information, please refer to
www.cree.com.
Non-GAAP Financial Measures:
This press release includes the Company’s business outlook for
its fiscal fourth quarter on both a GAAP and a non-GAAP basis. The
GAAP targets include certain costs, charges and expenses which are
excluded from our non-GAAP targets. By publishing these non-GAAP
targets, 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 or targets are not
prepared in accordance with GAAP and non-GAAP information should be
considered a supplement to, and not a substitute for, financial
statements or targets prepared in accordance with GAAP.
Forward Looking Statements:
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 or our announced chief executive
officer succession plan, could differ materially due to a number of
factors, including risks inherent in CEO succession, including
timing of retaining a new chief executive and transition and
integration risks, and with respect to our targets, 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 commercial Lighting results will continue to suffer if new
issues arise regarding issues related to product quality of
supplied components for this business; 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; 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
customers do not maintain their favorable perception of our brand
and products, resulting in lower demand for our products; the risk
that our products fail to perform or fail to meet customer
requirements or expectations, resulting in significant additional
costs, including costs associated with warranty returns or the
potential recall of our products; the risk that retail customers
may alter promotional pricing, increase promotion of a competitor’s
products over our products or reduce their inventory levels, all of
which could negatively affect product demand; the risk that our
investments may experience periods of significant stock price
volatility causing us to recognize fair value losses on our
investment; the risk that we have an increasingly complex supply
chain and its ability to scale to enable maintaining a sufficient
supply of raw materials, subsystems and finished products with the
required specifications and quality; 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, divestitures, joint ventures or investments
generally; 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
26, 2016, 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® is a registered trademark of Cree, Inc.
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version on businesswire.com: http://www.businesswire.com/news/home/20170519005356/en/
Cree, Inc.Raiford Garrabrant, 919-407-7895Director, Investor
RelationsFax: 919-407-5615investorrelations@cree.comorClaire
Simmons, 919-407-7844Corporate Marketingmedia@cree.com
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