Wolfspeed's Q2 Loss: $113.3M, Stock Plunges 14.54%!

August 17, 2023 – Wolfspeed, a prominent leader in silicon carbide (SiC) materials, reported its financial performance for the second quarter (Q2) of fiscal year 2023, covering the period from April to June. The company's revenue surpassed market expectations; however, a larger-than-anticipated loss led to a notable decline in post-market trading.

During Q2, Wolfspeed achieved a revenue of $235.8 million, reflecting a robust year-over-year growth of 3.2%. This exceeded initial market estimates of $224.5 million. Despite this impressive revenue figure, the operating net loss stood at $113.3 million, equivalent to a net loss of $0.91 per share. This marked a significant increase from the net loss of $61.8 million ($0.50 per share) reported during the corresponding period the previous year. After accounting for one-time adjustments, the core business reported a net loss of $0.42 per share, falling short of the $0.20 per share estimate provided by analysts surveyed by FactSet.

Looking ahead to the first quarter of fiscal year 2024 (Q3 2023), Wolfspeed forecasts a revenue range of $220 to $240 million, with an expected net loss per share ranging from $0.60 to $0.70. In comparison, analysts surveyed by FactSet anticipate a Q3 revenue of $234 million and a net loss per share of $0.29.

Wolfspeed's CEO, Gregg Lowe, underscored the company's achievement of securing $8.3 billion in customer design-in over the past year, reflecting sustained confidence in Wolfspeed's ability to meet future silicon carbide device demands. As a result, the company is strategically positioned to proactively expand its material and device manufacturing capacity throughout fiscal year 2024.

The financial report released by Wolfspeed disclosed its ongoing investments in facility construction and expansion projects. Although these investments have not yet yielded revenue, they reflect the company's forward-looking commitment. The associated startup costs have been recorded as operating expenses in the financial report, which have contributed to the overall financial picture.

On August 16th, Wolfspeed's stock price experienced a modest decline of 2.31%, closing at $53.17 per share, marking a new closing low since June 26th. Following the earnings announcement, the stock price experienced a more significant after-hours decline of 14.54%, reaching $45.44 per share.