Shares in semiconductor manufacturer Cree slipped in after-hours trading Thursday after the firm disclosed lower revenues than for the same quarter in 2005.

Cree (NASDAQ: CREE) did meet Wall Street analysts’ collective expectations with earnings of 6 cents per share.

Shares were down 2.3 percent, or 41 cents, from Thursday’s close of $17.45, within 45 minutes of the quarterly earnings report announcement.

Earnings actually were 21 cents, or $16.5 million, on revenues of $88.8 million. However, the bulk of the profit, or 15 cents per share, was produced by sale of marketable securities, Cree said in a statement after trading closed.

For the second quarter of fiscal 2007, which ended Dec. 31, Cree said revenues were down 16 percent from $105.6 million a year earlier. Earnings were 21 cents in that earlier quarter.

Shares in Cree have plummeted from a 52-week high of $35.30 per share in May of 2006 to a recent 52-week low of $15.25.

Cree Chief Executive Officer Chuck Swoboda attributed the revenue drop to slow sales of light-emitting diodes.

Analysts had expected $91.3 million in revenues, based on polling by Thomson Financial.

"As we announced in early December, the second quarter was more challenging than we had targeted, with lower LED chip sales," Swoboda said in a statement. "Despite the challenges in the LED chip business, we continued to make progress on our strategy to expand our business by leveraging our strengths in LED chip and [silicon carbide] materials technology to broaden our product line with higher-value, component level products for the emerging markets in LED lighting and power. Our new product lines delivered double-digit growth in Q2, with LED component sales increasing to more than 10 percent of total LED revenue for the first time. The growth in these new product lines is an important leading indicator of how we plan to grow the company over the next several years."

However, Cree does not forecast much improvement in the third quarter. Cree said it expected revenues to be “similar” to the second quarter, with earnings dipping to between 4 cents and 5 cents per share.

Cree did begin shipping new white LED chips in the XLamp product line in the second quarter.