Wolfspeed Stock Plummets, Firm Names 2 Board Members to Help Deal With Lenders
The struggling firm also added two new board members to help deal with its lenders.
In March, Wolfspeed warned that it might not receive money and tax breaks it was to scheduled to get from the CHIPS Act.Wolfspeed (WOLF) shares plunged 25% Friday, a day after the struggling silicone carbide chipmaker's revenue declined and its loss increased as sales at its Materials Products unit fell. In addition, the company added two new board members as it works to deal with its debt.
Wolfspeed reported fiscal third-quarter revenue dropped nearly 8% year-over-year to $185.4 million, missing Visible Alpha estimates. It posted an adjusted loss of $0.72 per share, $0.10 per share wider than a year ago.
Materials Products segment revenue tumbled 21% to $77.9 million. Revenue at its Power Products division was up 5% to $107.5 million.
Chair Tom Werner explained that Wolfspeed has made significant progress in its efforts in "strengthening our capital structure, improving our path to profitability, and raising cost effective capital to support our growth plan." Werner added that the company is continuing to work closely with its lenders "on ways to address our capital structure so that Wolfspeed has a strong financial foundation to support its continued success."
The semiconductor firm was already struggling when Werner, then the outgoing interim Executive Chair, warned in March that Wolfspeed may not realize up to $750 million in grants plus $1 billion in tax credits from the CHIPS and Science Act of 2022. That sent shares cratering.
In a press release separate from the financial report, Werner announced that Paul Walsh and Mark Jensen were appointed to the board. Werner explained that the two bring experience in dealing with lenders that "will be critical to our efforts in reaching an outcome that will support our long-term success."
Shares of Wolfspeed have lost half their value this year.
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