JDSU reports sales drop 8 percent at Santa Rosa unit

JDSU's Santa Rosa-based optical business saw sales drop 8 percent in the first quarter, hit by weaker global demand for its payment security and gesture recognition technology, the company said Tuesday.

But the unit avoided impacts of flooding in Thailand, which has halted manufacturing of other JDSU products. JDSU expects companywide revenue will drop 4 to 11 percent in the second quarter because of the floods.

The slowing world economy is affecting JDSU's Advanced Optical Technologies division, CEO Tom Waechter told Wall Street analysts Tuesday. The Santa Rosa business makes color-shifting pigments used in currency printing to prevent counterfeiting and three-dimensional images for authenticating credit cards.

Its thin-film coated optical filters are included in video game electronics to provide gesture recognition, a technology that lets a player control the action with the wave of a hand or other body movement.

JDSU coatings also are incorporated in 3D glasses and projector components for 3D cinema and theme park rides.

The Santa Rosa division, which has about 500 employees in Sonoma County, is releasing new products to drive growth, Waechter said Tuesday.

Earlier this month, it launched the first in a line of color-shifting pigments for consumer product decoration. The SpectraFlair pigments provide rainbow-color effects that can be displayed on apparel, electronics, sporting goods, automobiles and packaging, JDSU said.

The advanced optical unit reported $55.6 million in sales for the quarter ended Oct. 1, down 8 percent from the same period a year ago.

Companywide, JDSU posted revenue of $421 million for the quarter, down almost 11 percent from last year.

The Milpitas-based company lost $5.8 million in the quarter after an arbitrator ordered JDSU to pay $7.4 million in a legal dispute. Excluding the legal expense and other one-time costs, JDSU had quarterly income of $41 million.

JDSU shares rose almost 5 percent to $12 in after-hours trading after its revenue beat analysts' forecasts.