The share price of Emcore Corp. has fluctuated in recent weeks.
The Alhambra-based semiconductor manufacturer for the aerospace and defense industries saw its share price decrease by 21% from its close of 52 cents on Dec. 12 – the day it released its fiscal fourth-quarter earnings – to a close of 41 cents the following day on almost 2.2 million shares traded, or its third-highest volume of the past year.
The stock price has since risen to a recent high of 50 cents on Jan. 3, before falling again by 8% by Jan. 5, when it closed at 46 cents..
Overall, shares in the company lost 58% of their value between Jan. 11 of last year, when they closed at $1.19, and Jan. 11 of this year, when they ended trading at 50 cents.
In late June, the company was notified by the Nasdaq that it was out of compliance with its rules because its stock price closed below $1 a share for 30 consecutivedays.
The company is considering options such as a reverse stock split to address the deficiency. Emcore filed for an extension to gain compliance.
Recent earnings
Emcore reported on Dec. 12 an adjusted net loss of $2 million (-3 cents a share) for the quarter ending Sept. 30, compared to an adjusted net loss of $10.9 million (-29 cents) in the same period of the previous year. Revenue increased by nearly 5% from the fourth quarter of the prior year to $26.8 million.
In a conference call on Dec. 12 with analysts to discuss the quarterly results, Emcore Chief Executive Jeff Rittichier said that the company had completed the transformation into a pure-play aerospace and defense business last April.
This evolution of the business involved selling off noncore broadband and defense optoelectronics business segments to San Jose-based Photonics Foundries Inc. in October and signing a letter of intent to sell its indium phosphide wafer fabrication business.
“This agreement is secured with a deposit and also includes an obligation for the buyer to assume the lease obligations of two buildings on the Alhambra campus resulting in a reduction in long-term liabilities and cash out for outflow for Emcore,” Rittichier said.
The company is working to reduce the amount of floor space it requires in its facilities across the United States, he added.
“With the wafer fab sale, Alhambra will be down to just one building from five,” Rittichier continued. “Concord (in Northern California) will have its footprint cut in half, and we are working on a plan to right-size the Budd Lake (New Jersey) facility.”
On the negative side, the company was informed by L3Harris Technologies Inc. that it was canceling a contract for Emcore to develop a tri-axial inertial measurement unit.
Rittichier said he didn’t have any further information about the canceled contract and that he must refrain from discussing it until the company evaluates all of its options.
“Obviously, we are disappointed by this development and are considering all remedies available to us, but we believe that upside from our other unrelated programs from other product families can substantially offset the loss of (the inertial measurement unit work) in (the 2024 fiscal year),” he said.
The company has at least three other high-confidence programs, which could offset at least $10 million of the approximately $14 million in (inertial measurement unit) revenue that was expected to come in during the current fiscal year, he said.
Brian Kinstlinger, an analyst with Alliance Global Partners, asked during the conference call about the programs.
Rittichier said one of the programs was from the U.S. Navy for the Mark 48 torpedo.
“We have been notified that we will need to nearly double production in (the current fiscal year),” Rittichier added.
“The other two, we did not name, but when I say high-confidence programs, they are things that we have made and shipped before,” he continued. “So I’d rather not name the other two. It’s a competitive world out there. But when we say high-confidence orders, that’s what we (mean), things we’re already doing.”
