NeoPhotonics Provides Second Quarter 2019 Business Update

NeoPhotonics Corporation (NYSE: NPTN), a leading designer and manufacturer of optoelectronic solutions for the highest speed communications networks in telecom and datacenter applications, today announced an updated business outlook for the second quarter of 2019 as well as a write-down of certain inventories as a result of the U.S. Bureau of Industry and Security (BIS) of the U.S. Department of Commerce placing Huawei Technologies Co. and certain of its affiliates on the Bureau’s Entity List with an effective date of May 21, 2019. Companies may not provide products and technologies subject to U.S. Export Administration Regulations (EAR) to organizations on the “Entities List” without a license.

“This action creates a material impact on NeoPhotonics and many others in the optical communications market and related industries. We are fully complying with the restrictions and have ceased shipments of products subject to EAR,” said Tim Jenks, Chairman and CEO of NeoPhotonics. “Our objective is now to move rapidly to lower manufacturing and operating expense levels to be cash positive at a lower revenue level,” concluded Mr. Jenks.

Taking these actions into account, the Company is updating its outlook for the quarter ending June 30, 2019.

Revised Outlook for the Quarter Ending June 30, 2019
		GAAP		Non-GAAP
Revenue		$75 to $80 million
Gross Margin		10% to 14%		22% to 26%
Operating Expenses		$25 +/- $0.5 million		$22 to $23 million
Earnings per share		$0.40 to $0.30 net loss		$0.15 to $0.05 net loss

Prior Outlook for the Quarter Ending June 30, 2019