Wolfspeed Prepares Bankruptcy Amid Mounting Losses

Wolfspeed, a leading U.S. silicon carbide chip manufacturer, is preparing to file for Chapter 11 bankruptcy within weeks, with a majority of creditors reportedly supporting the move after out-of-court restructuring proposals were rejected. The company faces $6.5 billion in debt, sharply reduced demand in core markets, missed revenue targets, and the confirmed loss of expected federal CHIPS Act funding. Wolfspeed's shares have fallen over 88% in the past year, hitting all-time lows below $1 following news of the potential bankruptcy. In response to its financial crisis, the company has enacted significant layoffs and closed facilities to try to stabilize its finances and focus on next-generation technologies. Disagreements with key creditors, including Apollo Global Management, have complicated rescue talks, and a failed refinancing effort has further limited access to government support. Wolfspeed is actively discussing options with lenders and considering both in-court and out-of-court paths to resolve its liquidity problems.