Wolf Stock Stalls at Support After 50% Crash on Weak Q2 – Rebound or Break to $10?
Wolfspeed's resurrection tale has reached a crucial halt as poor guidance and operational difficulties dampen the excitement following an...
Quick overview
- Wolfspeed's stock experienced a dramatic surge of 3,000% after a successful restructuring plan, but has since fallen sharply, erasing nearly half of its gains.
- The company's weak financial guidance for the upcoming quarter, with expected revenue significantly below analyst expectations, has dampened investor optimism.
- Operational challenges, including supply chain disruptions and customer shifts to alternative suppliers, highlight the ongoing difficulties in Wolfspeed's recovery.
- Despite current setbacks, Wolfspeed's long-term prospects in silicon carbide technology remain promising, but investors are cautious about the sustainability of its recent rally.
Wolfspeed’s resurrection tale has reached a crucial halt as poor guidance and operational difficulties dampen the excitement following an explosive comeback that rekindled investor confidence.
A Rally That Shocked Wall Street
Wolfspeed (NASDAQ: WOLF) stunned markets earlier this month with one of the most dramatic stock surges of 2025. Following court approval of its restructuring plan — which slashed its debt burden by nearly 70% — the semiconductor manufacturer’s shares soared from $1.15 to $36.40 in just two weeks, a staggering 3,000% rise that rekindled investor belief in the company’s comeback.
But the euphoria proved short-lived. The stock reversed sharply in the following sessions, tumbling to $17.95 by Friday’s close, erasing nearly half of its gains and sparking doubts about the sustainability of its turnaround.
Guidance Miss Dampens Optimism
The optimism surrounding Wolfspeed’s restructuring has been overshadowed by its downbeat financial outlook for the upcoming quarter. The company now expects second-quarter revenue between $150 million and $190 million, far below the analyst consensus of $231.94 million and down from $196.8 million in the previous quarter.
Management attributed the shortfall to a combination of factors, including customers front-loading purchases ahead of a temporary factory shutdown and others shifting to alternative suppliers during Wolfspeed’s bankruptcy period. These challenges highlight lingering disruptions in the company’s supply chain and sales network.
Technical Weakness Signals Fragile Support
From a technical standpoint, Wolfspeed’s chart paints a mixed picture. The stock’s sharp retreat has tested the 50-day simple moving average (SMA), currently acting as fragile support near the $17 level.
WOLF Chart Daily – The 50 SMA Held for Now
While a brief pause in selling pressure may stabilize prices in the short term, failure to hold above this key level could open the door to further declines toward $15, or even $10 if investor sentiment continues to deteriorate.
Restructuring Brings Progress but Not Relief
The company’s successful bankruptcy exit in September 2025 was a major milestone, paving the way for a leaner, more focused organization. However, the latest earnings guidance reveals that Wolfspeed’s operational turnaround remains incomplete.
Management continues to prioritize debt reduction and efficiency improvements, but rebuilding customer confidence and restoring consistent revenue growth will take time. The semiconductor industry’s cyclical nature and ongoing global supply constraints add further complexity to the recovery path.
Outlook: A Recovery Still in Transition
Despite the recent turbulence, Wolfspeed’s long-term prospects in silicon carbide technology — a key component for electric vehicles and clean energy systems — remain promising. The company’s innovative potential and lighter balance sheet could support a gradual rebound once short-term disruptions fade.
Still, for now, investors are proceeding with caution. After one of the most astonishing rallies of the year, Wolfspeed must prove that its comeback is more than just a speculative surge — and that sustainable growth can follow the spectacle.
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