Cree on Thursday morning unveiled its latest advance in LED technology, saying it will “reduce system costs” for most lighting applications by 40 percent.

Shares rallied more than 5 percent, or $1.47, to $28.75 by mid-morning.

The news comes after an earnings report Tuesday led to a hammering of Creek (Nasdaq: CREE) stock with LEDs the big culprit. Shares plummeted to a 52-week low of $27.25.

Some analysts either downgraded the stock or cut its potential share price.

Its 52-week high is $67.98.

Cree Chairman and CEO Chuck Swoboda said in a conference call about the earnings Tuesday evening that new technology was on the way.

Thursday, he offered specifics about LED technology. He also has said new light bulb advances are on the way, and bulb sales are up more than 50 percent year-overo-year.

“As a technology company, we’re focused on breaking the performance barriers that really matter to the lighting industry,” Swoboda said about the LED advance.

“The SC5 Technolog Platform redefines what is possible in high-power LEDs by doubling the lumens out of a single LED, giving lighting manufacturers the flexibility to innovate significantly lower cost systems. This new platform establishes a new benchmark for LED lumens per wafer, which we believe will define the long-term success of our industry. This also validates our belief that high-power LED technology enables the best lighting system designs and a better lighting experience for end customers.”

According to Cree, the SC5 platform “achieves unparalleled lumen density and longer lifetime at higher operating temperatures than previous LED technology, which can significantly reduce thermal, mechanical and optical costs at the system level.”

Added Dave Emerson, the general manager for LEDs at Cree: 

“LEDs are no longer the most expensive portion of an LED lighting system, but they fundamentally determine the overall system performance and cost. While other LED manufacturers only promise incrementally lower LED cost, our new Extreme High Power (XHP) LEDs leveraging the SC5 Technology™ Platform directly address the increased burden that thermal, mechanical and optical elements now place on total system cost.”