Wolfspeed Reports 6% Revenue Decline and $1.33 Billion Operating Loss for Fiscal Year Ending June 29, 2025

Wolfspeed, Inc. reported a significant decline in its financial performance for the fiscal year ending June 29, 2025, with total revenue decreasing by 6% to $757.6 million, down from $807.2 million in the previous fiscal year. The company experienced a gross loss of $121.6 million, resulting in a gross margin of -16.1%, compared to a positive gross margin of 9.6% in fiscal 2024. This downturn was attributed primarily to weaker demand in the industrial and energy markets, although there was some offset from growth in automotive applications. The operating loss from continuing operations escalated to $1.33 billion, which included substantial restructuring costs and goodwill impairment charges.

In a strategic shift, Wolfspeed completed the divestiture of its RF product line in December 2023, which has been classified as discontinued operations. This divestiture was part of a broader restructuring plan initiated in early fiscal 2025, aimed at optimizing costs and transitioning production from 150mm to 200mm silicon carbide devices. The restructuring plan is expected to result in a cumulative headcount reduction of approximately 25%, with a significant portion already realized. The company anticipates total restructuring costs to range between $450 million and $500 million, including severance and asset impairment charges.

Operationally, Wolfspeed's design-ins and design-wins decreased compared to the previous year, although the latter reached the second-highest levels in the company's history for both the fiscal year and the fourth quarter. The company employed 3,434 individuals as of June 29, 2025, reflecting a reduction in workforce as part of its restructuring efforts. The company also reported a decrease in cash, cash equivalents, and short-term investments, which fell to $955.4 million from $2.17 billion in the prior year, primarily due to cash outflows related to restructuring and operational costs.

Looking ahead, Wolfspeed is focused on strengthening its balance sheet and improving financial performance as it navigates through its Chapter 11 bankruptcy proceedings. The company expects to reduce its overall funded debt by approximately 70%, equating to a $4.6 billion reduction, and to lower annual cash interest payments by about 60%. The successful implementation of the restructuring plan is critical for the company’s future operations and liquidity, as it aims to emerge from bankruptcy and capitalize on growth opportunities in the silicon carbide market, particularly in electric vehicle applications.