Wolfspeed recently reaffirmed its earnings guidance for Q3 2025 with projections indicating significant net losses, set against the backdrop of major leadership changes as Robert Feurle prepares to assume the roles of CEO and Board Member by May. Despite these developments, the company's stock plummeted 49% over the last month. This steep decline aligns with a broader market downturn exacerbated by intensified trade tensions and widespread sell-offs in the semiconductor sector, which was hit particularly hard as major indices like the Nasdaq Composite entered bear market territory amid these economic stresses.

Every company has risks, and we've spotted 3 risks for Wolfspeed you should know about.

This technology could replace computers: discover the 21 stocks are working to make quantum computing a reality.

Over the last year, Wolfspeed's total return was a decline of very large magnitude, approximately 90%. This underperformance contrasts sharply with the broader US market, which managed a modest gain of 3.3%. Several key events have shaped this downturn. Wolfspeed's Q2 FY2025 earnings report, released in January 2025, revealed a significant increase in net losses to US$372.2 million, contributing to investor concerns. Additionally, a class-action lawsuit filed in November 2024 alleged securities violations, potentially impacting investor confidence.

Furthermore, operational costs were poised to rise following an October 2024 debt financing move to secure US$750 million for facility expansions. Another factor was the dilutive effect of a January 2025 equity offering that raised US$200 million. While revenue forecasts remain high, these recent challenges, combined with industry competition, may have driven shareholder returns lower than both the market and industry averages over this period.

Gain insights into Wolfspeed's past trends and performance with our report on the company's historical track record.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include NYSE:WOLF.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com