Wolfspeed Inc (NYSE:WOLF) shares fell almost 50% amid concerns the chipmaker may not receive federal funding from the CHIPS and Science Act.
The company’s outgoing interim executive chairman Thomas Werner commented that the company is being managed to not be overly reliant on CHIPS funds, raising investor concerns about securing the funding.
Wolfspeed had previously announced in October 2024 that it was in line to receive $750 million in grants and $1 billion in tax credits from the CHIPS Act.
New CEO
Also weighing on the company’s stock was the appointment of chip industry veteran Robert Feurle as its new CEO as it navigates financial challenges.
Wolfspeed has been hit by a slowdown in demand from automotive customers, which has negatively impacted its profitability. It has already taken measures to address these challenges, including closing a 50mm device fabrication plant in Durham, North Carolina, and planning to lay off 20% of its employees
Shares of Wolfspeed traded down 48.7% falling below $3 on Friday, reaching their lowest level since 1998.