Veeco's last quarter operation was better than expected. MOCVD orders were strong this quarter.

Due to the strong demand in LED and solar market, MOCVD equipment manufacturer Veeco announced its fourth quarter 2009 earnings report. Revenue increased 32.7% year-on-year to US$146.4 million. The diluted earnings per share of the industry was US$0.41, up from US$0.15 in the same period of 2008. Both are better than market expectations. As of the end of December 2009, the cumulative total orders reached a record US$402 million. Veeco also plans to increase MOCVD capacity quarter by quarter in response to market demand.

Looking forward to the first quarter, Veeco estimates that revenue will be between 150 million and 165 million US dollars, and the diluted earnings per share of the industry is about 0.41~0.50 US dollars, which is also better than market expectations. Veeco CEO John Peeler pointed out that the company is increasing production capacity to meet customer demand. It plans to increase production capacity to 45 units in the first quarter and further increase capacity to 70 units in the second quarter. Can be increased to 120 units.

According to market analysts, Veeco currently has a market share of about 30% in the MOCVD market, which is second only to Aixtron's 60%. The combined market share is as high as 90%. Veeco estimates that the demand for MOCVD machines in Greater China (including Taiwan, South Korea and mainland China) will be between 300 and 350 in 2010, while Veeco is expected to win 50%.

Equipment industry statistics show that in 2009, global MOCVD shipments will be about 180 units, and it is estimated that it will jump to 600-680 units in 2010, of which 300-350 units are in Greater China.

In terms of market demand, Veeco estimates that the large demand for LEDs in 2010 mainly comes from TV and NB backlights. The TV backlight penetration rate is conservatively estimated to be 10~15%, but according to the customer's estimate, the lowest is 15 % takes off, up to 35%, so on average it is estimated to be above 25%, showing explosive growth. The other part is the backlight of NB and Netbook. The rough estimate is about 90%. It will be close to 100% in 2010. As for the monitor part, it is subject to higher price, so the growth is slower.

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