Financial Analysis

"Commitments and Contingencies Litigation The Company is currently a party to various legal proceedings, including the cases described below. While management presently believes that the ultimate outcome of such proceedings, individually and in the aggregate, will not materially harm the Companys financial position, cash flows, or overall trends in results of operations, legal proceedings are subject to inherent uncertainties, and unfavorable rulings could occur. On November 15, 2024, the Company and certain of its former executive officers were named as defendants (Defendants) in a securities class action lawsuit captioned Gary Zagami v Wolfspeed, Inc., et al., Case No. 6:24-cv-01395, which was filed in the United States District Court for the Northern District of New York. The complaint alleges that Defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended (the ""Exchange Act""), and Rule 10b-5 promulgated thereunder by making false and/or misleading statements between August 16, 2023 and November 6, 2024 in connection with the operational status, profitability, and growth potential of the Mohawk Valley fabrication facility, among other things. The complaint seeks unspecified compensatory damages and other relief. On January 8, 2025 and January 13, 2025, respectively, two additional lawsuits captioned Maizner v. Wolfspeed, Inc., et al., Case No. 6:25-cv-00046 and Ferreira v. Wolfspeed, Inc., et al., Case No. 6:25-CV-00062 were filed in …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

"Long-term Debt As of June 29, 2025 (Predecessor): (in millions of U.S. Dollars) Maturity Date Effective Interest Rate Initial Principal Repayment of principal Conversion to common stock Outstanding principal Unamortized premium/discount Ending Balance Equity component Fair Value Fair value level 1.75% Convertible Notes 5/1/2026 2.2 % $575.0 $ $ $575.0 ($2.0) $573.0 $ $145.2 Level 2 0.25% Convertible Notes 2/15/2028 0.6 % 750.0 750.0 (7.9) $742.1 186.6 Level 2 1.875% Convertible Notes 12/1/2029 2.1 % 1,750.0 1,750.0 (20.7) $1,729.3 450.6 Level 2 2030 Senior Notes 6/23/2030 16.3 % 1,250.0 1,521.2 (52.3) $1,468.9 1,308.2 Level 2 CRD Agreement Deposits 7/5/2033 6.8 % 2,000.0 2,062.0 (37.3) $2,024.7 556.7 Level 3 $6,325.0 $ $ $6,658.2 ($120.2) $6,538.0 $ $2,647.3 On the Petition Date, the Company commenced the Chapter 11 Cases. The filing of the Chapter 11 Cases constituted an event of default that accelerated the obligations under the Convertible Notes, Existing Senior Secured Notes, and the unsecured Customer Refundable Deposit Agreement, dated as of July 5, 2023, with Renesas (as amended to date, the CRD Agreement). On the Effective Date, the Company emerged from the Chapter 11 Cases. As of December 28, 2025 (Successor): (in millions of U.S. Dollars) Maturity Date (1) Effective Interest Rate Initial Principal Repayment of principal (2) Conversion to common stock (3) Outstanding principal Unamortized premium/discount Liability-classified derivative Ending Balance Equity compone …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

Disaggregated continuing operations revenue from external customers by geographic area is as follows: Successor Predecessor Period from September 30, 2025 to December 28, 2025 September 29, 2025 Three months ended December 29, 2024 (in millions of U.S. Dollars) Revenue % of Revenue Revenue % of Revenue Revenue % of Revenue United States $54.8 32.5 % % 29.2 16.2 % Hong Kong 30.6 18.2 % % 19.2 10.6 % Europe 26.6 15.8 % % 50.8 28.1 % Asia Pacific (1) 25.4 15.1 % % 23.9 13.2 % Singapore 11.2 6.6 % % 18.7 10.4 % China 9.8 5.8 % % 16.6 9.2 % Japan 6.9 4.1 % % 21.6 12.0 % Other 3.2 1.9 % % 0.5 0.3 % Total $168.5 $ $180.5 (1) Excluding China, Hong Kong, Japan and Singapore Successor Predecessor Period from September 30, 2025 to December 28, 2025 Period from June 30, 2025 to September 29, 2025 Six months ended December 29, 2024 (in millions of U.S. Dollars) Revenue % of Revenue Revenue % of Revenue Revenue % of Revenue United States $54.8 32.5 % 44.9 22.8 % 46.1 12.3 % Hong Kong 30.6 18.2 % 26.1 13.3 % 52.8 14.1 % Europe 26.6 15.8 % 36.3 18.4 % 89.6 23.9 % Asia Pacific (1) 25.4 15.1 % 49.1 24.9 % 40.6 10.8 % Singapore 11.2 6.6 % 7.6 3.9 % 62.8 16.7 % China 9.8 5.8 % 17.9 9.1 % 27.0 7.2 % Japan 6.9 4.1 % 13.3 6.8 % 55.7 14.8 % Other 3.2 1.9 % 1.6 0.8 % 0.6 0.2 % Total $168.5 $196.8 $375.2 (1) Excluding China, Hong Kong, Japan and Singapore …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

"Stock-Based Compensation Overview of Employee Stock-Based Compensation Plans The Company currently has two equity-based compensation plans, the Long-Term Incentive Plan and the Management Incentive Plan, which each provide for awards in the form of incentive stock options, stock appreciation right, restricted stock, restricted stock unit, performance share, performance stock unit, performance unit, other awards, or any combination of these. Please refer to Note 1 ""Basis of Presentation and New Accounting Standards"" for more information on the two equity-based compensation plans. The Companys stock-based awards can be either service-based and/or performance-based. Performance-based conditions are generally tied to future financial and/or operating performance of the Company and/or external based market metrics. The compensation expense with respect to performance-based grants is recognized if the Company believes it is probable that the performance condition will be achieved. The Company reassesses the probability of the achievement of the performance condition at each reporting period, and adjusts the compensation expense for subsequent changes in the estimate or actual outcome. As with non-performance based awards, compensation expense is recognized over the vesting period. For performance awards with market conditions, the Company estimates the grant date fair value using the Monte Carlo valuation model and expenses the awards over the vesting period regardless of whethe …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

"Fair Value of Financial Instruments The Company did not have any financial assets or liabilities requiring the use of Level 3 inputs as of December 28, 2025, except as otherwise noted below. There were no transfers between Level 1 and Level 2 during the twelve months ended December 28, 2025. The following table sets forth financial instruments carried at fair value within the U.S. GAAP hierarchy: Estimated fair value Successor Predecessor (in millions of U.S. Dollars) Fair value hierarchy December 28, 2025 June 29, 2025 Assets: Money market funds 1 $98.8 $61.8 U.S. treasury securities 1 144.2 224.6 MACOM Shares 1 102.0 Municipal bonds 2 49.2 79.2 Corporate bonds 2 119.1 196.8 Commercial paper 2 25.5 28.3 Certificates of deposit 2 $ $5.0 Liabilities: Forward equity contract 2 $302.5 $ Warrants 3 34.2 Embedded derivative on New 2L Renesas Convertible Notes 3 $103.5 $ Forward Equity Contract The fair value of the forward equity contract is determined using the observable market prices of our common stock and is not adjusted for holding restrictions. Before Regulatory Approvals were obtained, and as of December 28, 2025, the forward equity contract was subsequently remeasured at fair value at each reporting date, with changes in fair value recognized in ""Non-operating income, net"" in the Consolidated Statements of Operation. Embedded Derivative The New 2L Renesas Convertible Notes contain embedded conversion features that provide for conversion into shares of common stock as d …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

"Income Taxes In general, the variation between the Company's effective income tax rate and the U.S. statutory rate of 21% is primarily due to: (i) changes in the Companys valuation allowances against deferred tax assets in the U.S., (ii) projected income for the full year derived from international locations with differing tax rates than the U.S. and (iii) projected tax credits generated. On the Effective Date, the Company emerged from Chapter 11 upon all the conditions of the effectiveness of the Plan being satisfied or waived and the Plan becoming effective. Generally, any discharge of the Company's debt obligations for an amount less than the debts adjusted issue price will give rise to cancellation of debt (COD) income. Under Section 108 of the Code, a taxpayer is required to exclude COD from gross income if the debtor is under the jurisdiction of a court in a case under Chapter 11 of the Bankruptcy Code and the discharge of debt occurs pursuant to that proceeding. As a consequence of such an exclusion, a taxpayer generally must reduce certain of its tax attributes by the amount of COD income that it excluded from gross income. U.S. federal income tax attributes subject to reduction generally include (i) net operating losses (""NOLs"") and NOL carryforwards; (ii) general business credit carryovers; (iii) capital loss carryovers; (iv) tax basis in assets; and (v) foreign tax credit carryovers. As a result of the emergence from the Chapter 11 Cases, the Company estimates t …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

"Leases Balance Sheet Lease assets and liabilities are as follows: (in millions of U.S. Dollars) Successor Predecessor Operating Leases: December 28, 2025 June 29, 2025 Right-of-use asset (1) $97.5 $123.1 Current lease liability (2) 6.7 9.9 Non-current lease liability (3) 100.1 139.5 Total operating lease liabilities $106.8 $149.4 Finance Leases: Finance lease assets (4) $2.2 $8.3 Current portion of finance lease liabilities (5) 0.5 0.5 Finance lease liabilities, less current portion (6) 1.8 8.4 Total finance lease liabilities $2.3 $8.9 (1) Within other assets on the consolidated balance sheets. (2) Within other current liabilities on the consolidated balance sheets. (3) Within other long-term liabilities on the consolidated balance sheets. (4) Within property and equipment, net on the consolidated balance sheets. (5) Within finance lease liabilities on the consolidated balance sheets. (6) Within finance lease liabilities - long term on the consolidated balance sheets. Statements of Operations Successor Predecessor (in millions of U.S. Dollars) Period from September 30, 2025 to December 28, 2025 September 29, 2025 Three months ended December 29, 2024 Operating lease expense $4.9 $4.1 Finance lease amortization 0.1 0.2 Successor Predecessor (in millions of U.S. Dollars) Period from September 30, 2025 to December 28, 2025 Period from June 30, 2025 to September 29, 2025 Six months ended December 29, 2024 Operating lease expense $4.9 4.3 $8.1 Finance lease amortization 0.1 0.2 0. …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

"Recently Adopted Accounting Pronouncements In September 2025, the Financial Accounting Standards Board (the ""FASB"") issued Accounting Standards Update (""ASU"") 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606) (ASU 2025-07). The guidance refines the scope of Topic 815 to clarify which contracts are subject to derivative accounting. The guidance also provides clarification under Topic 606 for share-based payments from a customer in a revenue contract. The amendments in ASU 2025-07 are effective for fiscal years and interim periods beginning after December 15, 2026, with early adoption permitted. The Company early adopted ASU 2025-07 on September 29, 2025, on a prospective basis, which includes the scope exception for derivatives, and the adoption did not have a material impact on our financial statements. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Tax Disclosures, which requires disaggregated information about an entity's income tax rate reconciliation as well as information regarding cash taxes paid both in the United States and foreign jurisdictions. The amendments should be applied prospectively, with retrospective application permitted. The amendments are effective for annual periods beginning after December 15, 2024 with early adoption permitted. The new standard will require additional disaggregation of certain information in the Company's tax footnote and the Company inten …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

"Restructuring 2025 Restructuring Plan During the first quarter of fiscal 2025, the Company initiated a headcount reduction and facility closure and consolidation plan intended to optimize its cost structure as the Company accelerates its transition from 150mm to 200mm silicon carbide devices (the ""2025 Restructuring Plan""). The 2025 Restructuring Plan resulted in a cumulative total headcount reduction of approximately 28%. The Company's 150mm device fabrication facility in North Carolina has ceased production in the second quarter of fiscal 2026. The Company expects to incur additional costs over the next three to six months in association with the 2025 Restructuring Plan, specifically the wind-down of the 150mm device fabrication facility in Durham, North Carolina. The Company expects to incur approximately $460 million of total restructuring and related costs, including approximately $75 million of involuntary and voluntary severance costs, $125 million of other closure-related cash costs, and approximately $260 million of charges related to long-lived assets and other non-cash costs, including accelerated depreciation and impairments upon abandonment or disposal of machinery and equipment. A summary of the charges recognized in the consolidated statements of operations through the second quarter of fiscal 2026 and fiscal 2025, respectively, resulting from these restructuring activities is shown below: Successor Predecessor (in millions of U.S. Dollars) Period from Septe …

RestructuringAndRelatedActivitiesDisclosureTextBlock · excerpt; the full note is in the filing

"Revenue Recognition Contract liabilities and distributor-related reserves were $92.2 million as of December 28, 2025 and $65.6 million as of June 29, 2025. Contract liabilities are recorded within contract liabilities and distributor-related reserves and other long-term liabilities on the consolidated balance sheets. The increase in these reserves primarily relates to the Company's distributors carrying additional amounts of inventory as of December 28, 2025, due to planned shipments of last-time buys for the Company's 150mm offerings during the first quarter of fiscal 2026. Product Line Revenue The Company's continuing operations sells products from within two product lines: Power Products and silicon carbide and GaN materials (""Materials Products""). Revenue from these two product lines is as follows: Successor Predecessor (in millions of U.S. Dollars) Period from September 30, 2025 to December 28, 2025 September 29, 2025 Three months ended December 29, 2024 Power Products $118.3 $ $90.8 Materials Products 50.2 89.7 Total $168.5 $ $180.5 Successor Predecessor (in millions of U.S. Dollars) Period from September 30, 2025 to December 28, 2025 Period from June 30, 2025 to September 29, 2025 Six months ended December 29, 2024 Power Products $118.3 $131.8 $187.9 Materials Products 50.2 65.0 187.3 Total $168.5 $196.8 $375.2 Geographic Information The Company conducts business in several geographic areas. Revenue is attributed to a particular geographic region based on the shippi …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

"Subsequent EventsOn January 29, 2026, the Committee on Foreign Investment in the United States (CFIUS) formally cleared the Company's issuance of equity to Renesas. Pursuant to the Plan, on January 29, 2026, because all Regulatory Approvals, including CFIUS clearance, were received prior to the Regulatory Trigger Deadline, the Company issued 16,852,372 shares of common stock New Common Stock to Renesas. Additionally, holders of Old Common Stock immediately prior to the Plan Effective Date will receive their pro rata portion of 871,287 shares of New Common Stock. In addition, upon receipt of CFIUS clearance, the Renesas Warrant became exercisable and the New 2L Renesas Convertible Notes became convertible. Additionally, upon receipt of the Regulatory Approvals and the shares described above, Renesas' designation rights per the Investor Rights and Disposition Agreement were no longer applicable. Refer to ""Note 2 - Emergence from Voluntary Reorganization under Chapter 11"" for additional information."

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