Shares of chipmaker Wolfspeed (NYSE:WOLF) experienced a dramatic drop, falling 38% to $3.3 in premarket trading.
This sharp decline follows the company's announcement on Thursday that chip industry veteran Robert Feurle will assume the role of CEO, effective May 1st.
The market's negative reaction comes amidst existing concerns surrounding the company's performance and leadership.
Notably, Wolfspeed ousted its previous CEO, Gregg Lowe, without cause in November, creating uncertainty about the company's direction.
Adding to the volatility, Ortex estimates that approximately 32.5% of Wolfspeed's free float is held in short positions as of March 27th, indicating significant bearish sentiment among investors.
This high level of short interest can amplify price swings, particularly in response to news like a CEO transition.
Year-to-date, Wolfspeed's stock had already declined 19.2% up to the previous close, reflecting ongoing market skepticism.