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Contamination costs Emcore $4 million

Contaminated material used to produce Emcore's transceivers reduces revenue by $4 million.

Emcore, the semiconductor materials and devices company based in Somerset, NJ, was provided with contaminated material that it used in its new transceiver product line.

Emcore did not identify the contamination until the qualification testing of the finished modules was completed, leading to revenue figures $4 million below expectation for the quarter.

The company pulled shipment of the finished products because of fears of warranty returns. To prevent repetition the company has implemented additional quality tests within its supply chain, and is modifying finished products to satisfy additional customer qualification procedures.

"We are confident the materials issues have been resolved and high-volume production has resumed this quarter. We currently have purchase orders for this [transceiver] product of $10.2 million that we intend to ship over the next two quarters," said Reuben Richards, Emcore s CEO.

Emcore predicts revenue for the June quarter to be $21.2 million, up $5.2 million from the equivalent quarter last year, but down $2.0 million sequentially. Revenue from photovoltaics and electronic materials and devices product lines is expected to meet or exceed expectations.

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