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Why CyberOptics stock is down to 2-year low?

CyberOptics Corporation (NASDAQ: CYBE) stock fell to a nearly 2-year low of $12.75 on Wednesday. This follows the 3D sensing technology company’s sales warnings due to a slowdown in the chip demand and trade uncertainty.

The company said it will experience a cyclical, industry-wide slowdown in demand for surface mount technology (SMT) and semiconductor capital equipment and continued uncertainty in the global trade environment during the second quarter and full-year 2019.

Orders for SMT and semiconductor products started to weaken during the second quarter. The company said it expects sluggish market conditions to persist in the fourth quarter of 2019 before strengthening in early 2020.

CyberOptics stock drops to 2-year low
Photo Courtesy: CyberOptics

The company’s markets are highly pricing competitive, particularly in the electronics assembly and SMT markets. As a result, it has experienced ongoing pressure on its gross margins. The company compensates for pressure to reduce the price of its products by introducing new products with more features and improved performance and through manufacturing cost reduction programs.

The company holds 46 patents, with 26 of them in the US and the rest in foreign, on a number of technologies. This includes the technologies used in its 3D optical sensors, MRS technology, LaserAlign products, SIM sensor technology, inspection systems, WaferSense products, CyberGage 360, SQ3000 and SQ3000 3D CMM products, and other products. Also, the company has 21 pending patents with 10 of them in the US and balance in foreign.

For the first quarter, the company posted improved results that were generated by higher sales of 3D MRS-enabled SQ3000 automated optical inspection or AOI systems, MX600 sales and record quarterly sales of semiconductor sensors, primarily consisting of its WaferSense family of products. The performance of these products more than offset the expected reduction in sales of 3D and 2D OEM sensors due to near-term weakness in the SMT and semiconductor markets.

Shares of CyberOptics ended Wednesday’s trading session down 6.64% at $12.80 on the Nasdaq. The stock has fallen over 29% in the past year and over 25% in the past three months.

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