Kopin's III-V growth slows in Q3 to 4.4%
For third-quarter 2010, Kopin Corp of Taunton, MA, USA has reported revenue of $31.6m, down slightly on $32m a year ago but up 4.5% on $30.2m last quarter.
Revenue for CyberDisplays was $15m, down on $17.7m a year ago but up on $14.3m last quarter. Revenue for III-V products was $16.6m, up 16% on $14.3m a year ago and up 4.4% on $15.9m last quarter (although less than last quarter's growth of 7%).
"Driven by the continued strong demand for smart phones and other advanced mobile devices, our III-V revenue has increased 50% to $47.1m through the first nine months of 2010 from $31.5m for the same period last year as a result of a combination of an expanding market and, we believe, increasing our market share at several of our power amplifier circuit partners during the year," says president & CEO Dr John C.C. Fan. "III-V continued its momentum in the third quarter... These results reflect the strength of key end-markets," he adds.
Gross margin has rebounded from 25% last quarter to 32.3%, comparable to 32.6% a year ago. R&D expense of $4.8m was roughly level with $4.9m last quarter, up from $3.5m a year ago. "We have been increasing our R&D investments for new III-V products targeting smart phones and tablet computers, and for advancing Golden-i [displays] to market," says Fan. However, excluding gains on the sale of patents and the investment in Taiwan subsidiary KTC in 2009, net income has fallen further from $3.8m a year ago and $1.9m last quarter to $1.4m.
"We have continued to broaden our III-V product portfolio with the addition of new advanced manufacturing systems and structures that further enhance device performance and improve power efficiency," Fan says. "Furthermore, during the third quarter, we received a two-year $750,000 contract through the Missile Defense Agency to develop aluminum indium nitride (AlInN)-based high-electron-mobility transistors. This award enables us to leverage our proven success in III-V materials and nanoengineering, advancing toward our long-term goal of commercializing AlInN-based electronic materials," he adds.
"III-V revenue growth continues to be strong and we do not expect the normal seasonal decline in the fourth quarter," Fan notes. "Although we expect military display revenues to remain solid in the fourth quarter, on a full-year basis these results have been affected by a weak first quarter related to delays in the procurement cycle," he adds.
Accordingly, Kopin expects to achieve the low end of its revenue guidance of $120–130m for full-year 2010. "Although we have invested $9.7m in capital equipment and repurchased $5.4m of our stock during 2010, our balance sheet has remained very strong," comments Fan. During the third quarter, cash and marketable securities fell from $115.3m to $110.5m. In addition, the firm has no long-term debt.
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