Wolfspeed Shares Drop 18% After Q2 Results Miss Estimates Amid Weak EV Demand
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4d ago
0mins
Should l Buy WOLF?
Source: seekingalpha
- Earnings Decline: Wolfspeed's fiscal second quarter results missed estimates, leading to an approximately 18% drop in premarket shares, highlighting the severe reality of weak demand in the electric vehicle market.
- Weak Guidance: Analysts noted significant customer attrition during Wolfspeed's restructuring, with management forecasting an ~11% quarter-over-quarter revenue decline in the upcoming quarter, indicating ongoing revenue challenges.
- Cost Control Success: Throughout the restructuring, Wolfspeed effectively reduced capital expenditures by about 90% and operating expenses by around $200 million, achieving a cash balance of $1.3 billion against $600 million in debt, reflecting proactive financial management.
- New Growth Areas: Despite challenges, Wolfspeed is focusing on emerging markets such as data centers and solar wind applications, with analysts believing that Silicon Carbide's role in next-gen DC architectures will present significant growth opportunities for the company.
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Analyst Views on WOLF
Wall Street analysts forecast WOLF stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for WOLF is 30.00 USD with a low forecast of 30.00 USD and a high forecast of 30.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
1 Analyst Rating
0 Buy
1 Hold
0 Sell
Hold
Current: 15.740
Low
30.00
Averages
30.00
High
30.00
Current: 15.740
Low
30.00
Averages
30.00
High
30.00
About WOLF
Wolfspeed, Inc. is an innovator of wide bandgap semiconductors, focused on silicon carbide materials and devices for power applications. The Company’s products include power devices and silicon carbide and gallium nitride (GaN) materials. Its products are targeted for various applications such as electric vehicles, fast charging and renewable energy and storage. The Company’s materials products and power devices are used in electric vehicles, motor drives, power supplies, solar and transportation applications. Its materials products are also used in military communications, radar, satellite and telecommunication applications. The Company’s power device products consist of silicon carbide Schottky diodes, metal oxide semiconductor field effect transistors (MOSFETs) and power modules. Its silicon carbide materials products consist of silicon carbide bare wafers, epitaxial wafers, and GaN epitaxial layers on silicon carbide wafers.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Wolfspeed Shares Drop 18% After Q2 Results Miss Estimates Amid Weak EV Demand
- Earnings Decline: Wolfspeed's fiscal second quarter results missed estimates, leading to an approximately 18% drop in premarket shares, highlighting the severe reality of weak demand in the electric vehicle market.
- Weak Guidance: Analysts noted significant customer attrition during Wolfspeed's restructuring, with management forecasting an ~11% quarter-over-quarter revenue decline in the upcoming quarter, indicating ongoing revenue challenges.
- Cost Control Success: Throughout the restructuring, Wolfspeed effectively reduced capital expenditures by about 90% and operating expenses by around $200 million, achieving a cash balance of $1.3 billion against $600 million in debt, reflecting proactive financial management.
- New Growth Areas: Despite challenges, Wolfspeed is focusing on emerging markets such as data centers and solar wind applications, with analysts believing that Silicon Carbide's role in next-gen DC architectures will present significant growth opportunities for the company.
See More
Align Technology Reports Strong Q4 Earnings Beat
- Earnings Beat: Align Technology reported Q4 earnings of $3.29 per share, surpassing analyst expectations of $2.97, indicating a significant improvement in profitability and boosting market confidence in future growth.
- Sales Growth: The company achieved quarterly sales of $1.047 billion, exceeding the consensus estimate of $1.033 billion, demonstrating robust performance amid strong market demand.
- Stock Surge: Align's shares jumped 10.4% in pre-market trading to $178.13, reflecting a positive investor reaction to the financial results, which may attract more investor interest.
- Increased Market Confidence: This earnings beat not only enhances Align's market image but also potentially supports its future investment and expansion plans, further solidifying its leadership position in the industry.
See More
Wolfspeed Q2 2026 Earnings Call Insights
- Revenue Growth: Wolfspeed reported total revenue of $168 million for Q2, aligning with the midpoint of guidance, with power revenue at $118 million and Mohawk Valley contributing approximately $75 million, indicating the company's efforts in diversifying its revenue base.
- Manufacturing Transition: The company shut down its 150mm device fab a month ahead of schedule, fully transitioning to 200mm manufacturing, which enhances production efficiency and is expected to optimize earnings potential, reflecting management's focus on operational discipline.
- Strategic Partnership: Wolfspeed announced a new partnership with Toyota to power onboard charging systems for electric vehicles, marking a significant expansion into the EV sector and enhancing its competitive position in the market.
- Future Outlook: Management expects Q3 2026 revenue to range between $140 million and $160 million, primarily impacted by accelerated customer purchases and weaker EV demand, highlighting the challenges and uncertainties in the market environment.
See More
Wolfspeed (WOLF) Q2 2026 Earnings Call Transcript
See More
Wolfspeed Q2 Fiscal 2026 Results Miss Expectations
- Earnings Miss: Wolfspeed reported an adjusted loss per share of $5.78 for Q2 FY2026, significantly worse than the consensus estimate of ($0.74), leading to a 9% drop in after-hours trading, indicating market concerns over the company's profitability.
- Revenue Decline: The company's revenue fell 6.6% year-over-year to $168.5 million, below the $170 million estimate, highlighting increasing pressure in market competition that could undermine future investor confidence.
- Outlook Challenges: Wolfspeed anticipates third-quarter revenue between $140 million and $160 million, with a midpoint of $150 million, which is less than the $162.8 million estimate, suggesting challenges in regaining growth momentum.
- Strategic Shift: CEO Robert Feurle noted the early shutdown of the Durham 150mm device fab and the shift to the 200mm device fab, while achieving 50% sequential revenue growth in mid- and high-voltage markets like AI data centers, demonstrating efforts in market diversification.
See More
Wolfspeed Reports Q2 Losses Post-Bankruptcy
- Earnings Loss: Wolfspeed reported a quarterly loss of $5.78 per share, which may not align with estimates due to the application of fresh start accounting post-bankruptcy, highlighting challenges in financial restructuring.
- Revenue Miss: The quarterly revenue of $168.5 million fell short of the analyst consensus estimate of $170 million, indicating weak market demand that could undermine future investor confidence.
- AI Data Center Growth: Despite the overall revenue shortfall, AI data center revenue grew approximately 50% quarter-over-quarter, demonstrating the segment's potential and the company's commitment to technological innovation.
- Stock Price Volatility: Wolfspeed's stock fell 8.98% to $15.72 in Wednesday's extended trading, reflecting the market's negative reaction to the earnings report, which may impact the company's future financing capabilities.
See More
Wolfspeed Shares Drop 18% After Q2 Results Miss Estimates Amid Weak EV Demand
- Earnings Decline: Wolfspeed's fiscal second quarter results missed estimates, leading to an approximately 18% drop in premarket shares, highlighting the severe reality of weak demand in the electric vehicle market.
- Weak Guidance: Analysts noted significant customer attrition during Wolfspeed's restructuring, with management forecasting an ~11% quarter-over-quarter revenue decline in the upcoming quarter, indicating ongoing revenue challenges.
- Cost Control Success: Throughout the restructuring, Wolfspeed effectively reduced capital expenditures by about 90% and operating expenses by around $200 million, achieving a cash balance of $1.3 billion against $600 million in debt, reflecting proactive financial management.
- New Growth Areas: Despite challenges, Wolfspeed is focusing on emerging markets such as data centers and solar wind applications, with analysts believing that Silicon Carbide's role in next-gen DC architectures will present significant growth opportunities for the company.
See More
Align Technology Reports Strong Q4 Earnings Beat
- Earnings Beat: Align Technology reported Q4 earnings of $3.29 per share, surpassing analyst expectations of $2.97, indicating a significant improvement in profitability and boosting market confidence in future growth.
- Sales Growth: The company achieved quarterly sales of $1.047 billion, exceeding the consensus estimate of $1.033 billion, demonstrating robust performance amid strong market demand.
- Stock Surge: Align's shares jumped 10.4% in pre-market trading to $178.13, reflecting a positive investor reaction to the financial results, which may attract more investor interest.
- Increased Market Confidence: This earnings beat not only enhances Align's market image but also potentially supports its future investment and expansion plans, further solidifying its leadership position in the industry.
See More
Wolfspeed Q2 2026 Earnings Call Insights
- Revenue Growth: Wolfspeed reported total revenue of $168 million for Q2, aligning with the midpoint of guidance, with power revenue at $118 million and Mohawk Valley contributing approximately $75 million, indicating the company's efforts in diversifying its revenue base.
- Manufacturing Transition: The company shut down its 150mm device fab a month ahead of schedule, fully transitioning to 200mm manufacturing, which enhances production efficiency and is expected to optimize earnings potential, reflecting management's focus on operational discipline.
- Strategic Partnership: Wolfspeed announced a new partnership with Toyota to power onboard charging systems for electric vehicles, marking a significant expansion into the EV sector and enhancing its competitive position in the market.
- Future Outlook: Management expects Q3 2026 revenue to range between $140 million and $160 million, primarily impacted by accelerated customer purchases and weaker EV demand, highlighting the challenges and uncertainties in the market environment.
See More
Wolfspeed (WOLF) Q2 2026 Earnings Call Transcript
See More
Wolfspeed Q2 Fiscal 2026 Results Miss Expectations
- Earnings Miss: Wolfspeed reported an adjusted loss per share of $5.78 for Q2 FY2026, significantly worse than the consensus estimate of ($0.74), leading to a 9% drop in after-hours trading, indicating market concerns over the company's profitability.
- Revenue Decline: The company's revenue fell 6.6% year-over-year to $168.5 million, below the $170 million estimate, highlighting increasing pressure in market competition that could undermine future investor confidence.
- Outlook Challenges: Wolfspeed anticipates third-quarter revenue between $140 million and $160 million, with a midpoint of $150 million, which is less than the $162.8 million estimate, suggesting challenges in regaining growth momentum.
- Strategic Shift: CEO Robert Feurle noted the early shutdown of the Durham 150mm device fab and the shift to the 200mm device fab, while achieving 50% sequential revenue growth in mid- and high-voltage markets like AI data centers, demonstrating efforts in market diversification.
See More
Wolfspeed Reports Q2 Losses Post-Bankruptcy
- Earnings Loss: Wolfspeed reported a quarterly loss of $5.78 per share, which may not align with estimates due to the application of fresh start accounting post-bankruptcy, highlighting challenges in financial restructuring.
- Revenue Miss: The quarterly revenue of $168.5 million fell short of the analyst consensus estimate of $170 million, indicating weak market demand that could undermine future investor confidence.
- AI Data Center Growth: Despite the overall revenue shortfall, AI data center revenue grew approximately 50% quarter-over-quarter, demonstrating the segment's potential and the company's commitment to technological innovation.
- Stock Price Volatility: Wolfspeed's stock fell 8.98% to $15.72 in Wednesday's extended trading, reflecting the market's negative reaction to the earnings report, which may impact the company's future financing capabilities.
See More
