Wolfspeed(US:WOLF)2026-02-06 21:20Financial Performance - For the period from September 30, 2025, to December 28, 2025, net revenue was $168.5 million, a decrease of $12 million or 6.6% compared to the three months ended December 29, 2024, which had revenue of $180.5 million[203]. - The cost of revenue for the Successor period was $246.8 million, resulting in a gross loss of $78.3 million, compared to a gross loss of $37.2 million in the prior period[203]. - Net loss for the Successor period was $150.6 million, compared to a net income of $1,063.8 million in the prior period, reflecting a significant change due to the restructuring[203]. - The operating loss for the Successor period was $158.4 million, an improvement of $164.6 million or 51.0% compared to an operating loss of $323.0 million in the previous period[203]. Revenue Breakdown - Power products generated $118.3 million in revenue, accounting for 70.2% of total revenue, while materials products contributed $50.2 million, representing 29.8%[203]. - Net sales of Power Product offerings increased to $118.3 million, representing 70.2% of total revenue, driven by automotive and industrial applications[212]. - Net sales of Materials Product offerings decreased due to lower volumes, with a significant drop in revenue from long-term supply agreements compared to fiscal 2025[206]. Expenses - Research and development expenses were $24.9 million, a decrease of $19 million or 43.9% compared to $44.4 million in the previous period[203]. - Sales, general and administrative expenses were $29.4 million, down by $22 million or 42.5% from $51.1 million in the prior period[203]. - Restructuring and other operating expenses decreased by 83% to $28.2 million, primarily due to reduced restructuring charges[208]. - Research and development costs decreased to $24.9 million, reflecting planned reductions in wafer spend and lower personnel costs[212]. Cash Flow and Liquidity - Cash and cash equivalents increased to $1,028.8 million as of December 28, 2025, up $561.6 million from $467.2 million on June 29, 2025[217]. - Net cash used in operating activities for the period from September 30, 2025, to December 28, 2025, was ($42.6) million, a decrease of approximately $262 million compared to the same period in the previous year[217]. - Cash provided by investing activities increased by $1.3 billion compared to the six months ended December 29, 2024, primarily due to a planned decrease in capital expenditures and receipt of $700 million in refundable tax credits[221]. - Net cash used in financing activities increased by $617 million, primarily due to $565 million used to repay senior secured notes related to Chapter 11[221]. - The company reduced its overall debt by approximately 70%, or $4.6 billion, following the emergence from Chapter 11[218]. - The company has take-or-pay inventory supplier agreements requiring a minimum of $174 million in purchases over the next four years[219]. - As of December 28, 2025, the company did not have any off-balance sheet arrangements, ensuring liquidity and capital resources are not subject to off-balance sheet risks[222]. Strategic Focus - The company is focused on accelerating its path to profitability, advancing technology leadership, and driving operational excellence as part of its long-term growth strategy[198]. - The company continues to explore opportunities for product adoption in new industries such as AI, datacenters, grid modernization, and renewable energy[199]. - The company continues to evaluate strategic opportunities, including potential acquisitions and joint ventures, and may access capital markets for funding[220]. Accounting and Restructuring - The company emerged from Chapter 11 bankruptcy on September 29, 2025, adopting fresh start accounting, which resulted in a new basis of accounting[195][196]. - A $23 million increase in work-in-progress and finished goods inventory was recognized in cost of revenue due to fresh start accounting[206]. - Interest expense decreased significantly due to lower outstanding debt obligations following the emergence from Chapter 11[210]. - Non-operating expense increased to $67 million, primarily due to changes in the fair value of liability-classified derivative contracts[211]. - The company expects to incur significant underutilization costs until market demand meets production capacity[206]. - The company emerged from Chapter 11 on September 29, 2025, issuing new secured financing totaling $2.1 billion, including $1.3 billion in new Senior Secured Notes due 2030[215].