Wolfspeed(WOLF) - 2026 Q1 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Revenue for the first quarter came in at €197 million, flat sequentially and up slightly compared to the same period a year ago [23] - Non-GAAP gross margin was negative 26%, including approximately €29 million in specific inventory reserves and other one-time charges [23] - GAAP operating expenses were $84 million, which included $50 million of restructuring and transition-related items [24] - On a GAAP basis, the company reported a net loss of $4.12 per share, which includes significant reorganization items related to Chapter 11 proceedings [26] - Inventory levels were $385 million at the end of Q1, down approximately $50 million sequentially [26] Business Line Data and Key Metrics Changes - The company is focusing on aligning production with near-term demand to optimize efficiency while preserving flexibility at all sites [22] - Capital expenditures were $104 million, primarily directed towards closing out former capital commitments, with a significant reduction in gross CapEx spend [27] Market Data and Key Metrics Changes - Demand in the broader EV market has moderated in the near term, but long-term fundamentals remain intact [12] - The company anticipates ongoing softness in the market through the remainder of fiscal 2026 [22] Company Strategy and Development Direction - The company aims to accelerate its path to profitability with a disciplined plan under development [5] - Focus areas include advancing low-speed technology leadership, driving operational excellence, and aligning R&D priorities with customer needs [6][9] - The company has reorganized its business around key markets: Automotive, Industrial, Energy, Aerospace and Defense, and Materials [11] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges faced in scaling production to meet robust customer demand but believes they are well-positioned for future growth [7] - The company is focused on making decisions that create long-term value for shareholders and expects to unveil a comprehensive long-range plan in 2026 [30] Other Important Information - The company will adopt fresh start accounting next quarter, resulting in a new basis of accounting and a reset of financial statements [17] - The cash balance at the end of the quarter was €926 million, reflecting a strong liquidity position [20] Summary of Q&A Session - There was no Q&A session conducted during this earnings call [1]