Wolfspeed jumps on upbeat quarterly forecast

FILE PHOTO: U.S. President Joe Biden travels to North Carolina

(Reuters) - Chipmaker Wolfspeed on Monday forecast a smaller-than-estimated second-quarter loss as it expects a boost to its business from a ramp-up in production at its new New York factory, sending its shares up 8% in extended trading.

The strong forecast suggests that the company is on track to meet or exceed its production and revenue targets at its Mohawk Valley plant in New York that Wolfspeed has been banking on to bolster its results in the coming quarters, after many delays.

Wolfspeed CEO Gregg Lowe said the company's new facility in New York was on track to hit its goal for 20% utilization, which will help it keep a cap on its costs.

That facility, which started generating revenue at the end of Wolfspeed's fiscal 2023, contributed $4 million to its third-quarter revenue. Analysts at Piper Sandler had expected a contribution of about $3 million.

The company, which counts the U.S. government as a client, expects adjusted loss per share in the range of 56 cents and 70 cents, compared with analyst expectations for a loss of 69 cents per share, according to LSEG data.

Wolfspeed makes silicon carbide chips used to extend the range of electric vehicles.

The company said it expects second-quarter revenue from continuing operations of between $192 million and $222 million. Analysts on average had expected revenue of $220.2 million.

Net loss widened to $3.22 per share from 21 cents per share a year earlier.

Its quarterly revenue of $197.4 million missed analyst expectations of $207.7 million.

(Reporting by Zaheer Kachwala and Chavi Mehta in Bengaluru; Editing by Anil D'Silva)