Shares of Wolfspeed cratered 10.2% to $23.30 on Thursday, extending a punishing week that has now erased roughly 27% of the stock's value in just four trading sessions. The culprit: a toxic cocktail of extreme short selling and persistent doubts about whether this post-bankruptcy silicon carbide chipmaker can stop burning cash before the money runs out.
• More Than Half of Wolfspeed's Shares Are Bet Against It. As of the most recent FINRA data, 28 million shares — representing 57.26% of outstanding stock — have been sold short , meaning traders are wagering the price will fall further. By one measure, 117% of the freely tradable float is now sold short.
The borrow fee — the annual cost to maintain a short position — has soared to 932.81% , a figure so extreme it signals almost no shares are available to lend. That creates a hair-trigger dynamic: any good news could force short sellers to buy back shares en masse, but any bad news sends the stock into freefall, as it did this week.
• The Cash Math Still Worries Investors. Wolfspeed posted Q3 fiscal 2026 revenue of $150.2 million with a net loss of $119.9 million and negative free cash flow of $90 million.
Gross margin was negative 27% on a GAAP basis , meaning the company loses money on every dollar of product it ships. Management guided Q4 revenue at $140–$160 million with gross margins expected to remain negative. For shareholders, the question is straightforward: how long can the company survive at this burn rate?
• A Restructured Balance Sheet Buys Time, Not Safety. A March refinancing cut total debt by $97 million, lowered annual interest expense by roughly $62 million, and left the company with about $1.2 billion in liquidity.
Debt maturities now extend to 2030–2031, and annualized cash interest fell roughly 65% to about $145 million. That's real breathing room — but a June S-1 filing to sell 24 million shares for existing holders added dilution fears that continue to hang over the stock.
• The 2026 Rally Has Mostly Evaporated. After emerging from Chapter 11 bankruptcy last September with new shares , WOLF surged as much as 273% in 2026, touching $80.82 in May. It now trades 71% below that peak. The reversal underscores how speculative the investor base remains — and how quickly sentiment can flip when a company is still losing money on every chip it makes.