Wolfspeed stock tumbled on Thursday after the chipmaker topped estimates for its fiscal first quarter but gave disappointing guidance for the current period.
The Durham, N.C.-based company late Wednesday said it lost an adjusted 4 cents a share on sales of $241.3 million in the quarter ended Sept. 25. Analysts polled by FactSet expected Wolfspeed to lose 5 cents a share on sales of $239.8 million. In the year-earlier period, Wolfspeed lost 21 cents on sales of $156.6 million.
For the current quarter, Wolfspeed predicted an adjusted loss of 12 cents per share on sales of $225 million. That's based on the midpoint of its guidance. However, Wall Street had predicted a loss of a penny a share on sales of $252.5 million in the fiscal second quarter. In the year-earlier period, Wolfspeed lost 16 cents per share on sales of $173.1 million.
Wolfspeed is in investment mode as it builds new capacity for the production of next-generation power semiconductors.
Wolfspeed Stock Drops
On the stock market today, Wolfspeed stock plunged 18.2% to close at 87.06. During the regular session Wednesday, Wolfspeed stock rose 1.3% to close at 106.44.
"Our near-term revenue guidance is impacted solely by manufacturing and supply challenges in our current footprint, as our near-term demand continues to grow and the long-term demand continues to strengthen," Chief Executive Gregg Lowe said in a news release.
He added, "There is tremendous momentum for Wolfspeed across a growing number of mid- and high-powered applications, as evidenced by $3.5 billion of design-ins for the quarter, six times what it was in the prior-year period."
Wolfspeed's products include silicon carbide materials, power devices and radio-frequency devices for electric vehicles, 5G wireless, renewable energy and storage, and aerospace and defense. It also makes gallium nitride semiconductors.
Wolfspeed stock ranks No. 11 out of 33 stocks in IBD's semiconductor manufacturing industry group, according to IBD Stock Checkup. It has a so-so IBD Composite Rating of 74 out of 99.
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