Wolfspeed (NYSE:WOLF) Issues Earnings Results

Wolfspeed (NYSE:WOLF) posted its quarterly earnings results on Wednesday. The company reported ($2.03) earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of ($1.99) by ($0.04), FiscalAI reports. The firm had revenue of $155.00 million for the quarter, compared to the consensus estimate of $149.86 million. The business’s revenue was down 21.2% on a year-over-year basis. During the same quarter in the prior year, the firm posted ($0.55) EPS.

Here are the key takeaways from Wolfspeed’s conference call:

• Revenue was $155 million, above the midpoint of guidance, while power revenue rose 10% sequentially. Wolfspeed expects fiscal Q2 revenue of $155 million–$175 million and gross margin to improve toward break-even.
• Non-GAAP gross margin remained negative at 12.8%, and operating cash flow was negative $84 million. About $60 million of working-capital changes supported cash in the quarter, but management said most working-capital optimization is now complete.
• Wolfspeed said AI data-center revenue more than doubled year over year on a trailing 12-month basis, with an accelerating order book. It cited growing hyperscaler engagement, demand tied to high-voltage DC architectures, and a strategic-partner award from Megmeet.
• The company announced a conditional $1.5 billion, 30-year government loan commitment; the initial $600 million tranche is intended to refinance higher-cost debt, with management expecting more than $50 million in annual interest savings. Closing remains subject to further due diligence, a credit agreement, and financial and balance-sheet milestones, with completion targeted before year-end.
• Wolfspeed highlighted a majority-share long-term supply agreement with BorgWarner for its next-generation 800-volt SiC inverter platform, an expanded 200-millimeter wafer supply agreement with Infineon, and plans to extend its portfolio into GaN.

Wolfspeed Price Performance

Shares of WOLF traded down $3.25 during mid-day trading on Thursday, hitting $19.54. 4,782,509 shares of the company’s stock were exchanged, compared to its average volume of 4,257,455. The company has a 50-day simple moving average of $26.48 and a 200 day simple moving average of $30.17. The company has a market cap of $1.03 billion, a PE ratio of -1.24 and a beta of 8.67. Wolfspeed has a 52 week low of $13.48 and a 52 week high of $80.82.

Wall Street Analyst Weigh In

Several research analysts recently weighed in on the company. TD Cowen started coverage on Wolfspeed in a research note on Thursday, August 20th. They set a “hold” rating and a $25.00 target price for the company. Susquehanna reduced their price target on Wolfspeed from $30.00 to $25.00 and set a “neutral” rating for the company in a research report on Wednesday, October 21st. Wall Street Zen cut shares of Wolfspeed from a “sell” rating to a “strong sell” rating in a report on Saturday, September 19th. Weiss Ratings lowered shares of Wolfspeed from a “sell (d+)” rating to a “sell (d)” rating in a research report on Friday, October 23rd. Finally, Zacks Research upgraded Wolfspeed to a “hold” rating in a research note on Friday, September 25th. One research analyst has rated the stock with a Buy rating, three have assigned a Hold rating and one has issued a Sell rating to the company. According to data from MarketBeat, the stock currently has a consensus rating of “Hold” and an average target price of $23.33.

Wolfspeed Company Profile

Wolfspeed, Inc is a semiconductor company focused on silicon carbide (SiC) technologies. Its products are designed to support the conversion and management of electrical power in applications that require high efficiency, high voltage, and operation at elevated temperatures.

The company develops and manufactures SiC power devices, including metal-oxide-semiconductor field-effect transistors, diodes, power modules, and related components. It also produces SiC materials such as wafers and epitaxial substrates used by semiconductor manufacturers.