| Sponsored
Links |
|
|
|
|
|
Commentary:
CS/SSL Stock Portfolio Update for August
... It's "quarterly earnings" time again for many of the companies that trade over their various national stock exchanges. Of those included in the representative stock portfolio of 13 compound semi (CS) and solid state lighting (SSL) related companies that are covered periodically in The McDonald Report, Color Kinetics, Anadigics,...
Jump down to the full story
| |
Features:
|
|
Construction Begins on High Power Solid State Laser Facility
CompoundSemi News StaffAugust 3, 2006...The U.S. Military is one step closer to developing high powered solid state
lasers for missile defense and weapons systems. Construction has begun on a
U.S. Research center dedicated to high-powered lasers for the military. The
Directed Energy Production Facility will be constructed at Northrop Grumman’s
Space Park campus in Redondo Beach, California. The new, 11,000 square foot
Redondo Beach facility will house a Class 10,000 clean room and solid state
sub-labs for work on system components. Northrop Grumman, a major defense contractor
with headquarters in Los Angeles, California USA, says it expects to complete
renovations to an existing building by the end of 2006.
After construction, the researchers will begin Phase III of the Joint High-Power
Solid-State Laser (JHPSSL) program, which hopes to develop solid state lasers
powerful enough to protect against cruise missiles. A portion of the workload
will include integration of laser systems and military platforms such as armored
vehicles. A company with a 30-year history of working with lasers, Northrop
Grumman received $58 million last year after successfully demonstrating a 27
kW laser for 5 minutes and 50 seconds. While the researchers have developed
solid state lasers running at about 25kW, they hope to increase that to 100
kW soon to enable use against rockets and artillery shells. "Northrop
Grumman is on track to be the first ever to build and demonstrate a 100 kW electric
laser,'' Alexis Livanos, president of Northrop Grumman Space Technology,
said Tuesday, "This facility demonstrates our tremendous confidence
in the potential for laser weapons." Company
News Release
 |
Anadigics Cuts Sweet Deal With LG Electronics
CompoundSemi News StaffAugust 3, 2006...Anadigics, a wireless and broadband solutions provider headquartered in Warren,
New Jersey USA reports making the first shipments of its new EV-DO power amplifiers
to LG Electronics for its chocolate phone. The Chocolate, a sleekly styled phone
with camera, MP3, Streaming Video, and Bluetooth capability, is exclusively
offered through Verizon Wireless. The phone utilizes Anadigics’ AWT6310
dual-band CDMA power amplifier (PA) based on Anadigics’ InGaP HBT technology.
The AWT6310 features independent RF paths which the company says ensure optimal
performance for each band and 25 percent space savings over solutions requiring
two single-band PAs. Anadigics
News Release August 2, 2006...Emcore Corporation located in Somerset, New Jersey USA, announced that a team from Emcore's EMD divison, Group4 Labs and engineers at the U.S. Air Force
Research Laboratory (AFRL) have successfully demonstrated a gallium nitride (GaN)-on-diamond
high electron mobility transistor (HEMT). According to Emcore, the aluminum
gallium nitride (AlGaN) on GaN transistor layers were grown using metal-organic
chemical vapor deposition (MOCVD). The MOCVD process was completed at Emcore,
and then Group4 Labs attached their CVD-produced diamond substrate using their
patented technology. Finally, the AFRL fabricated the transistors.
Emcore said, that demonstration proved the feasibility of making GaN-based
radio frequency (RF) devices thermally coupled to diamond substrates for maximum
heat extraction. The team expects to be able to pack more devices in less space
due to better heat dissipation. Additionally the improved heat dissipation will
allow more devices to be placed close to the active device area. The team expects
that the novel packaging and foundry process could be used for high performance
GaN-based RF devices, high brightness LEDs and Laser Diodes. "We are
excited by the promise of this technology combining the most robust semiconductor
material with the best heat spreader," commented Dr. Ivan Eliashevich,
Director of R&D at Emcore Corporation's EMD division. Emcore
News Release.
This demonstration was the result of years of work during the compound semiconductor
industry’s on-again/off-again love affair with diamond substrates. While
diamond substrates have been made before, it took the advances of Group4 Labs
to allow successful thermal coupling of GaN-on-diamond. It took the perseverance
of the military to continue researching a technology many had given up on. The
advance also required the MOCVD innovation of Emcore. The demonstration, while
impressive, is still far from the commercial success some diamond substrate
pioneers hoped for. If diamond substrates are ever a commercial success, it
will take many more breakthroughs and the right market conditions for the team
and especially the military to be vindicated for their choice of continuing
research on diamond substrates. –Scott Mc Emcore Teams with Sandia on Terrestrial Solar Product Development
Compound Semi News StaffAugust 1, 2006...Emcore of Somerset, New Jersey, which has a major solar product facility in
Albuquerque, New Mexico USA, is teaming with its longstanding technology development
partner, Sandia National Labs of Albuquerque, to develop what are called "concentrator
photovoltaic power systems." The joint effort is part of both entities
ongoing terrestrial solar project that puts compound semi-based high efficiency
solar cells to work on ground-based systems. Until recently, high efficiency
CS solar cells, which employ GaAs on Ge technology, have been confined to satellite
applications. The vast majority of terrestrial solar is silicon based, but Emcore
aims to change that.
According to the contract signed by Emcore and Sandia, the prestigious USA
government-owned lab will provide technical support for Emcore's terrestrial
solar systems products, lending Sandia's +25 years of experience in the development
of photovoltaics for grid-tied, utility scale power generation. Emcore's president
and CEO, Reuben Richards, explained the goals of his company's new terrestrial
thrust. "Emcore is already the leading supplier of GaAs, multijunction
solar cell technology for power generation on satellites. We're adapting our
state-of-the-art solar cell technology as a base for the development of large
scale, concentrator photovoltaic power systems with the goal of becoming the
leader in solar energy power systems. We have a very successful track record
in commercializing next generation technologies, as we have done in the satellite
market. Sandia has long been a valuable partner in technology development for
Emcore and we look forward to their contributions to our program in terrestrial
power systems." Dr. Jeff Nelson, manager of the Sandia Solar Technologies
Group, will be point person on the joint development project. Company
news release
Agilent Technologies to Acquire Xpedion Design Systems
CompoundSemi News StaffJuly 31, 2006...Agilent, a communication electronics and measurement company headquartered
in Palo Alto, California USA, has signed a definitive agreement to acquire Xpedion
Design Systems, a maker of radio frequency (RF) simulation software. Xpedion
is a privately held company whose RFIC simulation software is used in high-speed
digital circuit and systems design in communications. The terms of the acquisition
were not disclosed. Agilent says that as companies move towards RF CMOS technology with greater
levels of integration, the technology requires more complete verification and
testing methods. The addition of Xpedion will allow Agilent customers to perform
simulations of full transceiver chains and analyze design solutions at the transistor
level more accurately. According to Agilent, this results in shorter design
cycles, reduced silicon spins, and higher-performing products. Xpedion is repotedly
a member of the Ready for IBM Technology Program, Cadence Connections Program,
the Mathworks Connections Program, and the Platform Partners Program. Xpedion
is also a Sun Microsystems development partner. Agilent
News Release
SMI Awarded Air Force Phase II Development Award for Silicon Photonics
CompoundSemi News StaffJuly 31, 2006...Structured Materials Industries reports being awarded a small business technology
transfer program grant to develop a low power, high bandwidth, high speed, and
ultra-small multi-channel WDM transponder on a single optoelectronic silicon
chip. The company says that despite advances in optical integration, creating
single packages housing multiple functions is difficult, and the resulting devices
are often large and incompatible with silicon CMOS technology. According to
the company, ultimately, the optical circuits will be directly integrated with
the microelectronic memory and logic devices required to fully control operation
of the transponder chip. SMI indicated that the reduction in the number of packages
decreases the size and cost of the devices. SMI did not disclose the amount
or terms of the research funding award. Company
News Release IQE Could be Profitable as Soon as 2007, Strategy Analytics Says
CompoundSemi News StaffJuly 31, 2006...Compound semiconductor market analyst company, Strategy Analytics (SA), says
that after IQE’s successful acquisition of Emcore’s Epitaxial Substrate
Division, IQE could become profitable by 2007. According to SA, IQE will increase
its share of the commercial substrate market. SA says that the acquisition will
allow IQE to offer a one-stop shop for MOCVD and MBE for GaAs device manufacturers.
SA predicts that the overall market for epitaxial substrates will grow 40 percent
year-on-year in 2006 and 30 percent in 2007, but it cautions that commercial
demand for MBE substrates is restricted by regional preferences for MOCVD and
captive capabilities. "This is a very positive move by IQE," notes Stephen Entwistle,
Vice President of the Strategic Technologies Practice at Strategy Analytics.
"However, IQE will still need to overcome several commercial challenges
to achieve its target of becoming the world's leading commercial supplier of
SI GaAs epitaxial substrates." Strategy
Analytics News Release RFMD EDGE PAs to be in 15 Samsung HandsetsJuly 31, 2006...RFMD, a radio systems solution developer in Greensboro, North Carolina USA,
announced the shipment of the mass produced EDGE power amplifiers (PAs) to Samsung
Electronics. Samsung will reportedly place the RF3159 linear EDGE power amplifiers
in at least 15 of its handset models. According to RFMD, the RF3159 is a high
linearity quad-band GSM/GPRS/EDGE PA designed to support multiple EDGE transceiver
platforms, and it is optimized for use with either direct in-phase and quadrative
or small signal polar modulation. The module is designed to be the final amplification
stage in a dual-mode GSM/GPRS/EDGE mobile transmit lineup operating in the 824MHz
to 915MHz and 1710MHz to 1910MHz bands. RFMD
News Release BluGlass to Raise Funds for GaN Process Development Facility
CompoundSemi News StaffJuly 28, 2006...A company based in Syndney, Australia, BluGlass, hopes to raise money to develop
processes for manufacturing and epitaxy of gallium nitride (GaN), according
to an article
from business news source, NineMSN.
The company says it has technology which allows GaN to be spread onto cheaper materials such as silicon or glass. BluGlass plans to raise money
by selling 30 million shares at 20 cents under its IPO price on August 4, ahead
of its proposed IPO on September 7. The funding will reportedly go towards establishing
a pilot factory for GaN manufacturing and epitaxy. BluGlass claims to have already
demonstrated its production processes on two inch wafers and is ramping up to
six inch types. The company is in an early stage and hasn't decided whether
it will make the LEDs itself, enter into a joint venture or license its intellectual
property. The company says its technology allows it to use glass or silicon
substrates instead of more costly sapphire or silicon carbide (SiC). BluGlass
says their research suggests that the company’s GaN processes might be
scalable to 8-inch or greater wafer sizes, which would substantially improve
production efficiencies. EU Antitrust Officials Probe Next Gen DVD Technology Licensing
CompoundSemi News StaffJuly 27, 2006...A European Union executive told Reuters
that European Commission antitrust officials are seeking more information about
licensing for next generation DVD technology from the makers of Blu-ray and
its rival, HD-DVD technology. HD DVD was created by Toshiba Corp, while Blu-ray
Disc was developed by a Sony-led consortium which includes Philips, Samsung
and Sharp Corporation. Blu-ray was released last month in the United States,
and HD DVD was released in April. Both technologies rely on solid state blue
lasers.
The Commission reportedly wants to know whether the licensing the both products
to hardware manufacturers and DVD producers could break European Union competition
rules. The Commission indicated it was not the start of a formal investigation.
According to the Commission, after receiving and examining more information
from the companies concerned it could decide to either open a formal investigation
or drop the case. Sony and its Blu-ray consortium companies began some licenses
in 2003, according to the official
Blu-ray web site. The site lists over 100 licensees in 6 categories, including
Hitachi, Pioneer, Samsung, TDK and LG Electronics. Both Sony and the maker of
its DVD format rival, Toshiba are members of the DVD
forum. Our news features are reported
by the CompoundSemi News staff writers.
For submissions or content suggestions, you can contact us using
editor -at - compoundsemi.com
For more information and to reserve promotion space contact
Info7 -at - compoundsemi.com
or call +1 (512) 257-9888
|
|
|
|
|
|
Commentary & Perspective...
CS/SSL Stock Portfolio Update for August
August 3, 2006...It's "quarterly earnings" time again for many of the companies that
trade over their various national stock exchanges. Of those included in the
representative
stock portfolio of 13 compound semi (CS) and solid state lighting (SSL)
related companies that are covered periodically in The McDonald Report,
Color Kinetics, Anadigics, and Emcore appear to be weathering the most recent
tech stock downturn reasonably well. And Spire, AXT, TriQuint, RF Micro Devices,
and JDSU seem to be hanging in there. The rest have been pulled down substantially
by the severe tech stock drop that continues to plague North American exchanges.
First off, let me remind you of the intent of this modest, model portfolio.
If you're new to the topic of my meager holdings in a cherry-picked handful
of stocks, please take a look at my "Stock
Ownership Disclosure Statement," a link
to which is now permanently affixed to the end of this, and each and every posted
McD Report column. I now hold a modest number of shares in each of the
following CS/SSL companies as industry barometers: Emcore (EMKR), Cree (CREE),
TriQuint (TQNT), Color Kinetics (CLRK), Anadigics (ANAD), JDS Uniphase (JDSU),
Spire (SPIR), RF Micro Devices (RFMD), Kopin (KOPN), WJ Communications (WJCI),
Vitesse (VTSS.PK) and Aixtron (AIXG) which are traded on the USA's Nasdaq exchange,
and TIR Systems which is traded on the Toronto exchange in Canada (TIR.TO).
The collection periodically provides good column fodder.
None of the above "bakers dozen" or "lucky 13" are performing
as they were last time I reviewed them (ref: March
20th column). They continued to rise into May, but even then, most still
hadn't yet approached their original IPO entry levels, not to mention the glory
years of old when some went through the roof! (Emcore's original IPO entry price,
for example, was $10/share and its all time high was $150.) If I was a serious
investor in tech stocks, and given the depths of the downturn, I'd have been
thrilled at the nice climb this spring. By July, every tech stock on the USA
exchanges, including the established silicon based companies, took a severe dip
in an icy pool... maybe they just needed a break from the summer heat.
Bear in mind that, although I covered the silicon and compound semi industries
for 30 years as a tech journalist, I'm a rank amateur in the personal investment
game. I starting buying the above stocks about a year ago as part of my semi-retirement,
and at a time when I thought they'd surely hit rock bottom. Holding these 13
makes me actually climb out of my 'industry-insider' advanced technology mindset and look
at our CS and SSL industries from the perspective an outsider might have. What I fail
to understand is why the investment community takes their global or national
confusion or worries or concerns out on our poor innocent
tech stocks? Nothing changes much within the companies involved, and with the
exception of Vitesse, which recently got delisted from the Nasdaq and is now
trading as VTSS.PK on the "pink sheet" penny exchange, there's nothing
but great news about new products, fresh alliances and great R&D out of
these companies. Business is picking up for all of them since the really hard
times of the last few years.
Ever wonder where the term "pink sheet" or "PK" came from?
According to my broker, back before computers took over the exchanges, brokers
used to be sent weekly listing of penny stocks and the lists were actually on
pink paper. For those unfamiliar with the term "penny stocks" and
"delisting" from the bigger exchanges, when a company doesn't meet
its obligations to file the proper financials with the SEC at the proper times,
and/or the stock continues to trade below $1 per share, the stock is moved over
to the "PK" listings. Once they've re-complied with the SEC rules,
they most often return to their original slot. Vitesse which
has strong roots in CS technology but really only does a bit of InP these days, appears to be moving in the right direction.
The new CEO Chris Gardner reported in their quarterly earnings report that the
company has closed new funding and looks to be headed back to positive cash
flow soon by improving their yields, cycle times, operational efficiencies and
possibly trimming some of their numerous product offerings. Chris replaced Lou
Tomasetta who is on administrative leave while issues of stock options get sorted
out. Headcount at Vitesse is now at 620 somewhat nervous employees. I'll happily
hang on to my Vitesse stock because they're likely to weather the storm. Besides,
they're located in Camarillo, California and who wouldn't want to work in Camarillo?
Cree, on the other hand, was a major disappointment this quarter, at least in the eyes of their
fickle investors. According to my press peers, they've had blue spectrum LED
"production issues" which, in my opinion, is no big deal, but Cree
warned that profits would fall short of expectations and their stock price dropped.
At the heart of the matter may well be what all American and European die suppliers
face: aggressive competition from their Asian competitors that continues to
force declining prices for blue spectrum and white LEDs. That's good for the
consumer, but it pressures companies like Cree to reduce manufacturing costs
even further. Cree's quarterly earnings report is August 11th when we'll learn
more.
To me, the most eye-catching of the batch this quarter is Emcore, which held
its conference call this morning (Aug. 3rd) where much was revealed. The sale of the Emcore's epiwafer and
device foundry (EMD) to IQE will likely go through in August when IQE goes to
their investors for approval to raise the money. The yes vote is essentially in the bag.
Just in case, and FYI as to how these deals go down, Emcore negotiated a "break" (or cancellation) fee of $700K
towards which IQE has already anted up $200K. Yesterday's
news about GaN on diamond transistors was exciting, but that will soon be
a triumph for IQE with the sale of EMD to the Cardiff, Wales based publicly held company. That's good for IQE but begs the question
whether or not the USA's DARPA agency can keep funding that project when ownership
passes over to a British company? We'll see. For sure all EMD employees will
be retained and they get to stay put in Somerset with all their nice, high end
MOCVD toys.
The most exciting Emcore news to me is the push into terrestrial applications
for their exceptional high efficiency GaAs concentrator solar cells. The recently
announced
development pact with Sandia for concentrator photovoltaic power systems
is the first hint we've received about what's involved in the rollout on earth
(vs. their traditional satellite apps). Emcore's president/CEO Reuben Richards explained to analysts
that all the photovoltaic operations are now in Albuquerque and that they've
already shipped to Sharp, but that these aren't yet commercial revenue levels.
Sharp is evidently developing a line of site project in Europe. Commercial
terms and production systems can be expected in calendar Q4 this year. The price
for GaAs solar now is about $5/watt for fully installed concentrator cells.
Reuben underscored that the first to market (which looks like Emcore) will get
to set the standards. It seems silicon cells are actually getting more expensive
but GaAs solar cell prices are decreasing, so there's hope for a terrestrial
takeover... eventually. Reuben also told analysts, specifically Jed Dorsheimer,
that Emcore's JV with GE, GELcore, "isn't strategic to our vision" he said,d mimicking
Jed's words. GELcore, Reuben explained, is now basically a break even stand-alone
company. "We and GE don't bring a lot to them now." He added that, "both near
and long-term, Emcore's resources will go to businesses they own and operate." Emcore owns 49% of the GELcore JV and is no longer requiring significant subsidity from either of its parents. Now that it's approaching profitability, I wouldn't be surprised if GELcore either spins off, or if it's smart, becomes
fully owned by GE and starts really competing with Philips and Osram for SSL
ultimate dominance.
The most typical report thus far (July
26th) and most uplifting for the overall CS space was from Ralph Quinsey,
president/CEO of TriQuint. Ralph said that, as of the end of June, "TriQuint
delivered another solid growth quarter, gained share in handsets and exceeded
expectations. This was our fifth consecutive quarter of revenue and gross margin
growth and our largest operating income quarter since March of 2001. Our net
earnings more than doubled this quarter as compared to the previous quarter.
We set new revenue records for both our innovative transmit modules and our
power amplifier modules. Bookings for transmit modules were up 48% over the
first quarter as a result of extending this leadership form factor into the
CDMA and 3G markets. I am also pleased we were awarded additional contract R&D
dollars from the Office of Naval Research (ONR) to invest in leadership technology
for future military applications. We remain on track to our long term goals
of innovation, profitable growth and share gains in our targeted markets and
are seeing the results of our execution evidenced by the increase in our earnings
outlook for the year.”
The most exciting report from the SSL side was from Color Kinetics (CK) in
early June when they announced that they were one of five companies selected
by the USA's Department of Energy (DoE) to receive funding to help in the effort
to replace incandescent lamps with our industry's advanced LED technology. DoE
is spreading $7 million around CK, GE, Eastman Kodak, Osram Sylvania and SRI
International for LED-based solid state lighting (SSL). CK conducts their quarterly
earnings conference call Aug. 3rd.
And finally, there's one company that leaves everyone in the summer dust, Spire.
Why? Not so much corporate performance, but personal performance by its founder,
president/CEO Roger Little who for the 9th time, has qualified for the upcoming
grueling Iron Man triathlon competition (ref: news
release). Roger's exactly my age: 67 and shames us all. Congrats,
Roger! Don't keel in Hawaii in October!!! I could probably survive the swim
portion, but that'd be all. In closing, if you want to get the straight scoop
direct from any of the above companies, tune in to the live or replays of their
calls which are generally accessible easily over each company's website. And
if you're an investor, keep you fingers crossed that things will again pick
up soon. It takes an iron will to thrive these days.
If you have news or
views to share about the compound semiconductor, LED or solid
state lighting industries
contact our Publisher, Tom Griffiths
His direct tel in Austin is +1-512-257-9888
|
|
