Why Wolfspeed Stock Skyrocketed 60% In Today’s After-Hours

Shares of Wolfspeed, a silicon carbide technology company, skyrocketed nearly 58% in Monday’s extended trading after confirming a “reorganization plan,” paving the way for its exit from bankruptcy.

Retail users of Stocktwits cheered the development, with sentiment toward Wolfspeed stock improving to ‘extremely bullish’ levels (84/100) by late Monday from ‘neutral’ a day ago. The message volume on the stream picked up pace to ‘extremely high’ levels.

The Durham, North Carolina-based company had filed for Chapter 11 bankruptcy in late June and simultaneously announced a debt restructuring agreement with key lenders, including its largest customer, Renesas Electronics. 

Wolfspeed said late Monday that it has received court approval for the reorganization plan. The company expects to emerge from bankruptcy over the next several weeks, aligning with the third-quarter timeline it previously provided.

After exiting Chapter 11 protection, the company plans to reduce its debt by 70%, allowing it to focus on executing its strategic priorities.

CEO Robert Feurle said, “We are pleased to reach this important milestone, which clears the path for us to complete our restructuring process in the coming weeks.”

“We believe that strengthening our capital structure will help us to shape Wolfspeed into a leader in its industry, and we look forward to emerging with the financial flexibility to move swiftly on our strategic priorities and reinforce our leadership in silicon carbide.”

Since the Chapter 11 filing, the company has tinkered with its C-suite, appointing tech industry veteran Gregor van Issum as CFO permanently and semiconductor industry veteran Bret Zahn to head its automotive business.

CEO Feurle joined the company in March, succeeding interim CEO and Chairman Thomas Werner, who had taken the reins after the company ousted Gregg Lowe amid challenges posed by the struggles of the electric-vehicle end market.

Wolfspeed stock has lost over 81% year-to-date.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Read Next: Why Did Nebius Group Stock Surge Over 44% After Hours Today?