Wolfspeed (WOLF) Q2 2025 earnings summary

Executive summary

• Q2 FY25 revenue was $181 million, down 13% year-over-year and 7% sequentially, with Mohawk Valley Fab contributing $52 million, up over 300% year-over-year.

• Aggressive restructuring, including facility closures and a 20% workforce reduction, is underway to accelerate the transition to 200mm silicon carbide and improve profitability.

• $200 million at-the-market equity offering completed to support liquidity and CHIPS funding; cash and short-term investments at quarter end were $1.4 billion.

• U.S. government support, including CHIPS Act funding and tax credits, is a key part of the liquidity and growth strategy.

• End markets remain challenged, but EV and AI/data center demand are expected to drive future growth.

Financial highlights

• Q2 FY25 revenue was $181 million, down 13% year-over-year; Power Products revenue was $90.8 million and Materials Products revenue was $89.7 million.

• Non-GAAP gross margin was 2%, down from 16% a year ago; GAAP gross margin was -21%.

• Non-GAAP net loss for Q2 was $122.6 million ($0.95/share); GAAP net loss was $372 million ($2.88/share).

• Adjusted EBITDA was negative $58 million; free cash flow was negative $598 million for the quarter.

• Operating expenses were $108 million, down $11 million quarter-over-quarter.

Outlook and guidance

• Q3 FY25 revenue guidance is $170–$200 million, with Mohawk Valley expected to contribute $55–$75 million.

• Q3 non-GAAP gross margin expected between -3% and 7%; non-GAAP OpEx expected between $99 million and $104 million.

• Q3 non-GAAP net loss expected between $119 million and $138 million; GAAP net loss expected between $295 million and $270 million.

• CapEx for fiscal 2025 maintained at $1.1–$1.3 billion, with sharp reductions expected in fiscal 2026.

• Restructuring plan targets $200 million in annualized cost savings, with total restructuring costs of $400–$450 million.