News: Microelectronics
28 March 2025
Wolfspeed receives $192m in Section 48D cash tax refunds from IRS
Wolfspeed Inc of Durham, NC, USA — which makes silicon carbide (SiC) materials and power semiconductor devices — says that it has received $192.1m in cash tax refunds from the advanced manufacturing tax credit under Section 48D (including $186.5m owed to it for both fiscal 2023 and fiscal 2024 taxes, as well as accrued interest). This comprises part of the approximately $1bn total Section 48D cash tax refunds that the firm expects to receive. As of the end of fiscal second-quarter 2025 (to 29 December 2024), Wolfspeed had accrued a total of $865m in Section 48D tax credits. The firm expects to receive more than $600m in cash tax refunds in fiscal 2026.
Wolfspeed intends to use the tax credit proceeds to strengthen its capital structure and for general corporate purposes. The firm expects that its cash balance at the end of fiscal third-quarter 2025 (to 30 March) will be about $1.3bn, inclusive of these recently received 48D cash tax credits.
Guidance reaffirmed
For fiscal third-quarter 2025, Wolfspeed is reaffirming its business outlook of revenue from continuing operations of $170–200m, non-GAAP gross margin of –3% to +7%, operating expenses of $99–104m, and net loss of $138–119m ($0.88–0.76 per diluted share).
The firm is also reaffirming the guidance that it issued in its Form 8-K filed on 7 March for capital expenditures of $150–200m in fiscal 2026 and $30–50m in fiscal 2027.
Wolfspeed also expects:
- adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) break-even point of $800m of annual revenue upon completion of the operational simplifications, additional restructuring actions (including the closure of North Carolina Fab), and other cost-reduction initiatives;
- $200m of unlevered operating cash flow in fiscal 2026 based on targeted fiscal 2026 revenue growth;
- positive levered free cash flow in fiscal 2027 following completion of refinancing transactions.
Wolfspeed says that it continues to explore alternatives with regard to its convertible notes, in partnership with its advisors, and remains in a dialogue with lenders, including Apollo and Renesas. The firm adds that it maintains constructive dialogue with the White House, its legislators and the US Department of Commerce to secure federal funding and on ways that Wolfspeed can support the Trump Administration’s efforts to reinforce US industrial leadership in semiconductors, secure domestic supply chains, and reshore the manufacturing of critical mineral derivatives, including semiconductor wafers.
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