Layer 7 · WOLF — Wolfspeed Inc.

Live: USD 38.55 · Earnings (last): Q3 FY26 — EPS -$3.26 vs -$0.56 consensus; rev $150M vs $209.76M consensus (-28%); emerged Chapter 11 · Next earnings: not within 60d · Conviction: 3/10

Bottleneck context

Wolfspeed is a pure-play silicon carbide (SiC) vertically integrated producer — substrate, epi, device, module. The AI / power-electronics bottleneck is real if you believe SiC ends up in AI rack-level power conversion, but the dominant SiC demand pull is electric vehicles, where the demand picture has materially softened. The Mohawk Valley fab is the asset; the question has always been whether ramp execution beats the cash burn timeline.

Why Tier C

Just emerged from Chapter 11 — total debt cut ~70%, maturities pushed to 2030, cash interest -60%. Stock is +7.26% AH post-Q3 and has recovered to $38.55 near 52-week high. That is the positive read. The negative read: Q3 revenue still missed Street consensus by 28%, EPS loss of -$3.26 was almost 6x worse than -$0.56 consensus, and the operational thesis remains unproven even with the balance sheet repaired. Internal flag moved from WATCH-DISTRESS 3/10 to WATCH-RECOVERY but still high-risk turnaround.

Watch trigger

Two consecutive quarters of revenue beating prior quarter AND Mohawk Valley utilisation disclosed above 60%.

Position guidance

No position. Upgrade-watch only — do not initiate until earnings confirm operational stabilisation. Speculative re-look candidate for Q1/Q2 2027.

Appendix A — Coverage Audit

• Universe size: 98
• Tier A: 18
• Tier B: 49
• Tier C: 31
• Names covered (post-assembly): 98 of 98