Friday’s trading session dealt a heavy blow to Wolfspeed investors as the silicon carbide specialist released its inaugural quarterly report following bankruptcy proceedings. The company’s stock settled at $17.95, marking a 3.75 percent decline. This negative market response stemmed directly from staggering first-quarter figures for fiscal year 2026, which revealed a net loss totaling $643.6 million.
Financial Report Reveals Deep Challenges
The recently filed 10-Q statement exposes the technology firm’s ongoing struggles. While revenue held steady at $196.8 million, operational performance shocked market participants. Although reorganization expenses accounted for $503.8 million of the historic deficit, core business operations showed significant weakness.
A detailed examination of the financial metrics presents concerning reading. Wolfspeed recorded a gross loss of $77.1 million alongside an operating loss reaching $161.4 million. The company’s Power Products division achieved $131.8 million in revenue, showing some growth, while Materials Products revenue contracted sharply to $65.0 million.
Restructuring Brings Silver Linings
The Chapter 11 process did yield one positive outcome: substantial debt reduction. Total liabilities decreased by approximately 70 percent, providing financial breathing room. The organization now maintains a robust liquidity position with $926.0 million in cash and short-term investments available.
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Guidance Disappoints Market Observers
Recovery appears distant based on management’s current projections. For the approaching second quarter, Wolfspeed anticipates revenue between $150 million and $190 million – representing a notable drop from first-quarter performance. Company leadership attributes this forecast to accelerated customer orders in Q1 combined with persistent market softness.
The negative gross and operating margins present particular concern, demonstrating that profitability remains elusive even when excluding restructuring costs. Underutilized manufacturing capacity and tepid demand continue to pressure business operations.
Market experts and shareholders now await the subsequent quarterly disclosure scheduled for early February 2026. This upcoming report will reveal whether the streamlined financial foundation can sufficiently support the company through its operational difficulties.
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