Citing uncertainty in demand from China, NeoPhotonic announced a set of restructuring actions, including a reduction in force, real estate consolidation, a write-down of inventory for certain programs and assets and a write-down of idle assets.
NeoPhotonics also trimmed its financial outlook for the third quarter of 2017, saying revenue is now expected to be in the range of $69 to $71 million, with GAAP gross margin of approximately 10% to 13% and GAAP loss per share of $0.50 to $0.40, inclusive of restructuring charges. Previously, the company had stated revenue expectations for the third quarter of 2017 to be $70 to $76 million, GAAP gross margin of 23% to 26%, and GAAP net loss per share of $0.21 to $0.11 and non-GAAP gross margin of 24% to 27%.
“Lacking a clear indication of increased demand in China in the third quarter, we initiated several operational changes with the goal of expediting our return to profitability, including implementing certain restructuring initiatives designed to align our business with the current demand environment and lowering manufacturing output to manage inventory levels,” said Tim Jenks, Chairman and CEO of NeoPhotonics. “In taking these actions, we have maintained our research and development focus on products for next-generation coherent systems, operating at 400 Gigabits/sec to beyond 1 Terabit/sec, wherein our advanced hybrid photonic integration provides the highest value,” concluded Mr. Jenks.
