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Investing.com -- Wolfspeed Inc (NYSE:WOLF), a silicon carbide technology company, saw its shares plunge 10.8% in after-hours trading Wednesday after issuing second-quarter revenue guidance well below analyst expectations, despite reporting better-than-expected first-quarter results.
The company, which recently emerged from Chapter 11 bankruptcy, reported a first-quarter non-GAAP loss of $0.55 per share, beating analyst estimates of a $0.67 loss. Revenue came in at $196.8 million, slightly above the consensus estimate of $192.66 million and up 1.1% YoY.
However, Wolfspeed’s outlook for the second quarter significantly disappointed investors, with the company forecasting revenue between $150 million and $190 million, well below analyst expectations of $202.7 million. The midpoint of this guidance range ($170 million) represents a 16% shortfall compared to consensus estimates.
"In my first months as CEO, I’ve been deeply impressed by the resilience and focus of the Wolfspeed team. Through our restructuring, we’ve strengthened the foundation of the company, emerging as a leaner organization with a focus on product innovation and market leadership," said Wolfspeed CEO Robert Feurle.
The company attributed the projected sequential revenue decline to accelerated customer purchases in the first quarter, as some customers built inventory ahead of the planned closure of Wolfspeed’s Durham facility at year-end. Additionally, certain customers pursued second-sourcing during the company’s bankruptcy process.
Wolfspeed’s first-quarter gross margin deteriorated significantly to -26% on a non-GAAP basis, compared to 3% in the same period last year. The company reported $47 million in underutilization costs related to its Mohawk Valley and Siler City facilities, up from $26 million a year earlier.
The company ended the quarter with $926 million in cash, cash equivalents, and short-term investments. Wolfspeed officially emerged from Chapter 11 bankruptcy on September 29, 2025, and plans to provide a comprehensive financial update in the first half of calendar 2026.
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