Wolfspeed (NYSE:WOLF) reported a massive $1.1 billion accounting gain for its fiscal second quarter as it emerged from a comprehensive financial restructuring, even as operational margins remained under heavy pressure from underutilization costs.
The Durham, North Carolina-based leader in silicon carbide technology posted a GAAP net loss of $151 million on revenue of $168 million for the period ended Dec. 28, 2025.
The quarter was defined by the company's adoption of "fresh start" accounting following its emergence from Chapter 11 bankruptcy.
This process involved remeasuring all assets and liabilities to fair value, resulting in a one-time reorganization gain of $1.1 billion.
While total revenue was soft, the Mohawk Valley Fab contributed a record $76 million, a bright spot in the company’s transition to 200mm wafer production.
Despite the accounting windfall, Wolfspeed's core profitability remains a work in progress.
Non-GAAP gross margin was negative 34%, weighed down by $48 million in underutilization costs and $23 million in inventory fair value step-ups.
However, the balance sheet was significantly fortified, ending the quarter with $1.3 billion in cash and equivalents—bolstered by $700 million in Section 48D tax refunds.