Wolfspeed announced on Monday that it had removed Gregg Lowe as its CEO without cause, following a series of challenges, including slowing demand for electric vehicles (EVs) and ongoing manufacturing issues. The news sent the company’s shares up approximately 6%. Lowe, who had been at the helm since 2017, will receive a severance package as part of the settlement, according to the company’s filing.
Wolfspeed, a semiconductor manufacturer specializing in silicon carbide (SiC) chips, which are more energy-efficient than traditional silicon chips, has been grappling with a number of difficulties. These include manufacturing problems at its North Carolina facility, which the company recently announced will be shut down, as well as weaker-than-expected orders from industrial and energy sectors. The company, which serves clients such as General Motors (GM.N) and Mercedes-Benz (MBGn.DE), had previously forecast lower-than-expected quarterly revenue and revealed plans to book $174 million in restructuring charges related to the facility closure.
The company also disclosed it would lay off 20% of its workforce. Wolfspeed had already scaled back its plans for growth, including shelving its factory project in Ensdorf, Germany, due to slower EV adoption in Europe.
Analysts at Charter Equity Research noted that amid a tough demand environment, restructuring efforts, and reduced capital expenditure for fiscal 2025, the new management is unlikely to drive a significant rally in the company’s stock without major changes, such as a potential sale. Wolfspeed’s shares have dropped about 85% this year, underperforming both the S&P 500 and the Philadelphia semiconductor index.
In light of Lowe’s departure, the company has appointed Chairman Thomas Werner as executive chairman and announced that a search for a permanent CEO is underway.
