Why Wolfspeed Shares Are Racing Higher Tuesday

Wolfspeed Inc WOLF shares are trading higher Tuesday following the company's quarterly results. Here's a rundown of the report. 

• Q1 Revenue: $197.4 million versus estimates of $207.64 million
• Q1 EPS: 53 cent loss versus estimates for a 67 cent loss

Revenues increased 4% year-over-year. Device design-ins came in at $2.2 billion and design-wins totaled more than $1 billion. The company noted that it incurred $8.4 million of factory start-up costs and $34.4 million of underutilization costs in the quarter.

"We kicked off our fiscal year with a strong quarter in both execution and market share. Not only have we continued to win in the marketplace, as evidenced by our third highest quarter of design-ins and a record quarter of design-wins, we have clear focus on the ramp of our Mohawk Valley Fab," said Gregg Lowe, CEO of Wolfspeed.

Outlook: Wolfspeed is targeting fiscal second-quarter revenue from continuing operations of $192 million to $222 million. The company anticipates an adjusted net loss of 56 cents to 70 cents per share. 

Following the print, Morgan Stanley analyst Joseph Moore maintained Wolfspeed with an Equal-Weight rating and lowered the price target from $42 to $34.

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WOLF Price Action: Wolfspeed shares were up 23.1% at $34.08 at the time of publication, according to Benzinga Pro.

Photo: StockSnap from Pixabay.