POET Stock Rebounds After-Hours: US Redomicile Plan Directly Addresses Wolfpack's Short Thesis

• POET will shift its headquarters from Canada to the U.S. to avoid potential characterization as a foreign business.
• POET shares gained 2.4% in after-hours trading; they had tumbled 8% in the regular session following Wolfpack’s report.
• Wolfpack flagged that U.S. shareholders need to file certain forms to avoid a high tax burden arising from POET’s PFIC classification; POET said it would help with the paperwork.

POET Technologies shares rebounded in extended trading on Tuesday after the company announced plans to redomicile in the U.S. and support shareholders with tax compliance, easing concerns about a potential classification as a Passive Foreign Investment Company (PFIC), which can trigger unfavorable tax treatment for American investors.

“As the Company looks to 2026, we believe that we will not qualify as a PFIC. Nevertheless, the Board of Directors has declared its intention to move the Company’s headquarters to and redomicile the Company in the U.S. so that it will no longer be a foreign corporation, which would eliminate the possibility of the Company being classified as a PFIC in future years,” CFO Thomas Mika said in a statement, adding that the shift would be put to a shareholder vote in June.

POET shares rose 2.4% in after-hours on Tuesday. They had tumbled 8% in the regular session after Wolfpack Research disclosed a short position and alleged that the company was less than forthcoming about its potential qualification as a passive foreign investment company (PFIC), which would entail higher taxes and compliance for U.S. shareholders.

Wolfpack’s Warnings Regarding POET

In its Tuesday report, Wolfpack flagged POET’s repeated pivots – from IoT to medical devices and now AI – while generating just $2.3 million in revenue since 2020, arguing the company’s core business is effectively selling stock.

Wolfpack described POET as "an obvious stock promotion" and said that the Canadian company may qualify as a PFIC due to its cash accumulation through share dilution and limited operating revenue. The firm said this classification could create significant tax liabilities for U.S. shareholders, who must make proper elections with the IRS by Wednesday to avoid penalties.

PFIC classification applies to certain foreign companies and can trigger complex reporting obligations and adverse tax consequences for U.S. investors. It generally covers firms that derive most of their income from passive sources or hold a large share of passive assets.

In its response, POET said it would likely be classified as a PFIC for the year ended December 2025 and plans to provide the necessary information to help U.S. shareholders mitigate the potential tax impact. Investors can mitigate potential liabilities by making a timely “qualified electing fund” (QEF) election on their POET shares.

Retail Turns More Bullish On POET

POET now designs and manufactures high-speed optical engines and related photonic components, though they are still in an early commercial phase. Those solutions are high in demand due to a breakneck buildout of AI data centers, making POET a key stock on investors’ radars.

On Stocktwits, the retail sentiment shifted to ‘extremely bullish’ by late Tuesday, up from ‘bullish’ the previous day, amid ‘extremely high’ message volume.

“This news tonight most likely caught Wolf ***pack off guard. I don’t think they were expecting a strong and informative response so quickly. We can get a huge short squeeze tomorrow while they and the others cover,” said a user.

POET shares have traded through sharp peaks and troughs over the last six months. Year-to-date, they are up 6%.

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