Wolfspeed's stock sinks as silicon

Jun 04, 2023

Wolfspeed Inc. shares fell nearly 15% in Wednesday’s after-hours action after the company posted a wider-than-expected loss for the latest quarter and also forecast steeper-than-anticipated losses in the current period.

The silicon-carbide chip company logged a fiscal fourth-quarter net loss from continuing operations of $113.3 million, or 91 cents a share, compared with a loss of $61.8 million, or 50 cents a share, in the year-prior period.

On an adjusted basis, Wolfspeed WOLF, +3.89% lost 42 cents a share from continuing operations, while analysts surveyed by FactSet were expecting a 20-cent loss per share.

Revenue increased to $235.8 million from $228.5 million, while analysts were projecting $224.5 million.

For the fiscal first quarter, Wolfspeed anticipates $220 million to $240 million in revenue and a 60-cent to 70-cent adjusted per-share loss. The FactSet consensus was for $234 million in revenue and a 29-cent adjusted loss per share.

See also: Cisco Systems had a strong quarter but its cautious full-year guidance pushes shares down

“With approximately $8.3 billion of customer design-ins secured in the last 12 months, customers are continuing to select Wolfspeed for their future silicon-carbide device needs, so we must remain keenly focused on scaling our materials and device capacity in fiscal 2024,” Chief Executive Gregg Lowe said in a release.

The company noted in its earnings release that it’s “incurring significant factory startup costs relating to facilities that we are constructing or expanding that have not yet started revenue-generating production.” These costs are treated as operating expenses in Wolfspeed’s financials.

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Emily Bary is a MarketWatch reporter based in New York.