DURHAM, North Carolina, August 21, 2026, 06:34 EDT — U.S. cash markets remained shut while premarket activity saw notable movement.
- Shares of Wolfspeed dropped 9.42% as fourth-quarter revenue decreased by 24% from the previous year.
- Each $1 in sales resulted in an adjusted gross loss of approximately 20 cents.
- AI data-center revenue rose by over two times, though management did not disclose an exact dollar amount.
Wolfspeed, Inc. NYSE:WOLF shed roughly $142 million in market value on Thursday. Shares dropped 9.42% to $26.35 following fiscal fourth-quarter results. Shares rebounded 2.09% to $26.90 in premarket trading at 06:34 EDT.
The report revealed a significant disconnect between Wolfspeed’s AI narrative and the operational performance of its factory. Revenue from AI data-centers rose by over twofold in fiscal 2026. However, the company posted an adjusted gross loss of 20% on $149.6 million in sales for the quarter.
Revenue was in line with the midpoint of management’s guidance but came in 0.3% under analysts’ consensus, while the adjusted loss stood at $2.26 per share compared with an expected loss of $1.46. The earnings miss was significantly wider.
| Fourth-quarter scorecard | Reported | Comparison | Result |
|---|---|---|---|
| Revenue | $149.6 million | $150.0 million estimate | 0.3% below forecast |
| Adjusted EPS | -$2.26 | -$1.46 estimate | 54.8% greater loss |
| Adjusted gross margin | -20% | -21% in Q3 | Improved by 1 point |
| Adjusted EBITDA | -$62 million | -$62 million in Q3 | No change |
| Operating cash flow | -$54 million | -$84 million in Q3 | $30 million improvement |
The cash-flow improvement requires context. In the fourth quarter, operating cash flow was helped by a $41 million reduction in inventory. Without this impact, cash burn would have been close to $95 million. This is an early estimate according to management’s reconciliation.
Wolfspeed closed out June holding approximately $1.1 billion in cash and short-term investments. This amount covers 20.4 quarters of its disclosed cash burn. When adjusted for working capital, the coverage drops to 11.6 quarters. Both figures exclude pending debt repayments or capital requirements.
| Liquidity lens | Q4 basis | Implied cash coverage |
|---|---|---|
| Operating cash burn reported | $54 million | 20.4 quarters |
| Benefit from inventory | $41 million | One-time working-capital support |
| Estimated adjusted burn | $95 million | 11.6 quarters |
| Cash plus short-term investments | $1.1 billion | Decreased from $1.2 billion in Q3 |
Growth composition improved. Power-product revenue totaled approximately $106 million, increasing 6% from the previous quarter. Materials revenue stood at about $43 million. Sales to AI data centers climbed around 20% from the third quarter and more than doubled year-over-year.
| Business momentum | Latest figure | Change or context |
|---|---|---|
| Power products | About $106 million | Sequential growth of 6% |
| Materials products | About $43 million | Accounts for 29% of total revenue |
| AI data-center revenue | Not disclosed | Sequential rise of 20%; figure has more than doubled in FY2026 |
| Total revenue | $149.6 million | Declined 24% from the prior year |
| Annualized revenue run rate | $598.4 million | Roughly $202 million short of margin-breakeven level |
The absent figure is significant. Management did not reveal the AI data-center revenue in dollar terms. Investors still lack the means to compare its scale to softer automotive and materials demand. Growth percentages alone do not indicate margin impact.
Factory utilization continues to be the primary limitation. According to management, adjusted gross-margin breakeven requires an annual revenue run rate of around $800 million, depending on mix. The latest quarterly results annualize to $598.4 million, meaning Wolfspeed requires roughly 34% additional scale.
Chief Executive Robert Feurle stated that Wolfspeed “continued to expand our device business” as AI data-center activity increased. The company has also qualified its silicon-carbide technology for LITEON’s upcoming 800-volt power platform. Wolfspeed announcement
Wolfspeed’s outlook for the near term is cautious. The company forecasts first-quarter revenue between $140 million and $160 million, with the midpoint showing little change. Adjusted gross margin is projected to stay negative, and adjusted operating expenses are expected in the range of $62 million to $66 million.
| Analyst recommendations | Rating | Target | Date | Vs. $26.35 close |
|---|---|---|---|---|
| Susquehanna, Christopher Rolland | Hold | $30 | August 20 | +13.9% |
| TD Cowen, Joshua Buchalter | Hold | $25 | August 20 | -5.1% |
| Consensus from two analysts | 2 Hold, 0 Buy, 0 Sell | $27.50 on average | Previous three months | +4.4% |
The analyst range is tight. Susquehanna projects a 13.9% upside, and TD Cowen forecasts a 5.1% downside. Both analysts advise holding the stock. The differing views highlight operational promise but no evident margin improvement.
Risks: AI demand may grow more quickly than anticipated. Still, low utilization, negative margins, ongoing cash burn and outstanding debt could offset those gains. Weaker automotive performance and pressure on silicon-carbide prices may further postpone breakeven.
The following proof point is not simply a claim of percentage growth. Investors require a concrete AI revenue figure and a believable strategy to exceed the $800 million scale threshold.
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