895419--8/24/2006--CREE_INC

related topics
{customer, product, revenue}
{product, market, service}
{property, intellectual, protect}
{acquisition, growth, future}
{product, candidate, development}
{control, financial, internal}
{financial, litigation, operation}
{stock, price, operating}
{operation, international, foreign}
{cost, operation, labor}
{loan, real, estate}
Our operating results and margins may fluctuate significantly. If we are unable to produce and sell adequate quantities of our LED products and improve our yields and reduce costs, our operating results may suffer. Our operating results are substantially dependent on the development of new products based on our SiC and GaN technology. Our results of operations, financial condition and business would be harmed if we were unable to balance customer demand and capacity. Our LED revenues are highly dependent on our customers ability to produce competitive white LED products using our LED chips. We are highly dependent on trends in mobile products to drive a substantial percentage of LED demand. If we experience poor production yields or cannot reduce costs, our margins could decline and our operating results may suffer. We depend on a few large customers and our revenues can be affected by their contract terms. Our traditional LED chip customers may reduce orders as a result of our entry into the packaged LED markets. The markets in which we operate are highly competitive and have evolving technology standards. Our business may be impaired by claims that we, or our customers, infringe intellectual property rights of others. There are limitations on our ability to protect our intellectual property. We face significant challenges managing our growth. Performance of our investments in other companies could affect our financial results. We rely on a few key sole source and limited source suppliers. If government agencies discontinue or curtail their funding for our research and development programs, our business may suffer. If our products fail to perform or meet customer requirements, we could incur significant additional costs. We are subject to risks from international sales. If we fail to evaluate and implement strategic opportunities successfully, our business may suffer. Litigation could adversely affect our operating results and financial condition.

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