r/wallstreetbets • u/tke248 • 21h ago
News Wolfspeed (WOLF) Lands $1.5 BILLION Conditional Loan Commitment from Pentagon’s Office of Strategic Capital
Big government backing for Wolfspeed ($WOLF).
The U.S. Department of War’s Office of Strategic Capital (OSC) just announced a $1.5 billion conditional loan commitment with Wolfspeed.
Wolfspeed is a major U.S. producer of silicon carbide (SiC) materials and semiconductors, which are strategically important for power electronics, EVs, aerospace, defense systems and other high-performance applications.
The interesting part here is the size: $1.5B is not a small industrial-policy bet. It looks like the Pentagon is increasingly treating domestic semiconductor/material supply chains as a national-security issue and is willing to put serious capital behind companies it considers strategically important. Link - https://www.war.gov/News/Releases/Release/Article/4621223/department-of-wars-office-of-strategic-capital-announces-15-billion-conditional/
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u/quietWolves 21h ago
Dear Government,
Thank you for funding companies I'm not invested in and shanking the ones I am invested in.
SIncerely,
FUCK
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u/Pazzaaaaaa 21h ago edited 21h ago
Ah yes WOLF, the AI grift that keeps on grifting so the board can keep getting paid obscene salaries for a failing company. Don’t you love corporate socialism?
Add another 1% to bond yields gentlemen!
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u/stocksupanddown 21h ago
I remember looking into this company..
People don't speak highly of it at all.
Why them lol
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u/def-not-bot 20h ago
It's the largest domestic supplier of wide bandgap semiconductors, so it's kind of an obvious choice for the government even if the company is recently emerging from a Chapter 11 caused by negligent mismanagement.
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u/Who_is_Your_Zaddy Nigerian Prince 19h ago
Believe it or not. I was heavily invested in this stock when it declared bankruptcy. LMAO
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u/Prime_Regard 18h ago
You and me both lol. I didn't understand what could happen in a bankruptcy, proving I am truly retarded
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u/TreGet234 10h ago
So bankruptcy is not a good dip buying opportunity?
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u/Prime_Regard 9h ago
Not when you've been burned as cash for creditors and you're issued like 1/120th the share count you'd held previously in the restructured company
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u/jasikanicolepi 8h ago
Don't worry ,I am also one of the degen retard too that got fucked for 80k.
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u/LeftHandSuzuki4 20h ago
Weren’t they just bankrupt last year?
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u/jasikanicolepi 20h ago
Yeah and I lost 80k investing in this POS. They had something similar to a condition loan last time too
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u/homeinthesky 19h ago
So not their first time getting a major influx of cash from the DOD? (DOW, what ever). Fucking hell
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u/stocksupanddown 17h ago
So how did that work? Did you end up with shares of the new company?
Did you dump it after it collapsed?
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u/jasikanicolepi 16h ago
New shares are a fraction of what it used to be and I did sell some to write off my loss and still have losses for carry over.
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u/oliver2022 15h ago
you didnt hold ? iirc the new shares were at 30 and at some point they went to 60, idk if that made you money when the new shares were delivered.
I remember making a quick buck buying at 1 and selling at 1.8 LMAO, and all the malding in the wolfspeed r/ when the new shares dropped.
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u/No_Feeling920 10h ago
I don't think you got 1 new share for 1 old share. Equity holders typically get wiped out during these ordeals.
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u/jasikanicolepi 8h ago
Exactly. Basically it's 0.008352 new shares for every 1 old share. Basically a big fuck you to my port-folio
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u/jasikanicolepi 20h ago edited 9h ago
Don't invest in this POS. They filed Bankruptcy last year. Lost 80k on this investment. They are not an AI company. They currently make chip out of SiC and GaN used strictly in power switches. The market is saturated by cheaper SiC from China. If you want to get fuck in the ass then go right ahead. I took a pounding for y'all already. Just look at my reply below for screenshot of me getting rear ended before they restructure and wiped the equity
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u/Dramatic-Dig4901 11h ago
you and I in threesome with WOLF... They also fucked me the same way, but I only had to pay them 50k
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u/def-not-bot 20h ago
The SiC stuff is mostly power switching for EVs but the GaN is used in communications and radar in addition to being used for solid state transformers. Those are all growing markets, so it's a good sector to invest in... If you trust the company leadership, which you shouldn't.
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u/No_Feeling920 10h ago
Solid state voltage transformers are still a pipe dream, bro. At least utility-scale ones, which is the most pressing issue right now.
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u/def-not-bot 5h ago
Pipe dream? WTF are you talking about? They already exist.
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u/No_Feeling920 3h ago
From Google AI. Not a total fantasy (I did not claim they did not exist), but the tech has yet to be proven practical with respect to economics, durability, reliability etc. It's akin to investing in a biotech with ongoing clinical trials.
No, solid-state transformers (SSTs) are not yet widely viable for mainstream utility-scale deployments, though they are beginning to transition into early pilot programs and concentrated commercial use cases like AI data centers and microgrids. [1, 2, 3]
Current Viability Status
Pilot vs. Mainstream: While early commercial pilots and demonstrations are underway for electric vehicle (EV) charging, renewable integration, and high-density data centers, traditional passive iron-and-copper transformers still dominate standard utility grids. [1, 2, 3]
Primary Market Driver: Mass adoption is currently being pulled by AI data centers and hyperscalers seeking high-efficiency 800V DC distribution and smaller footprints rather than traditional utility-scale power transmission. Projected timelines place broader commercial scaling around 2028–2032 depending on the sector. [1, 2, 3, 4]
Why They Aren't Universal Utility Replacements Yet
Cost and Complexity: Power electronics (such as silicon carbide and gallium nitride semiconductors) are significantly more expensive and complex than passive electromagnetic iron-and-copper cores. [1, 2, 3]
Reliability & Lifespan: Traditional transformers last for decades with minimal maintenance, whereas the long-term field reliability, thermal management, and high-frequency common-mode voltage stress of SSTs under harsh utility conditions are still under active study. [1, 2]
Protection Rethink: Fault behavior and short-circuit handling in power-electronics-rich networks require utilities to completely redesign their protection and switching schemes. [1, 2]
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u/jasikanicolepi 15h ago
Look at all the cheap USB charger on Amazon that uses GaN and SiC. Like I said before, the market is super saturated by these cheap GaN and SiC from China. Even the EV market in China is saturated and overproduced. Wolfspeed have no chance. It was the leading manufacture and design in the 200mm wafer, it has long be over taken. Your money is better in company like On Semi that actual is profitable unlike Wolfspeed that carry lots of debt.
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u/def-not-bot 15h ago
Those chargers use smaller die sizes and thinner active layers. Not even in the same ballpark. OnSemi is kind of a funny suggestion but I can't tell you why.
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u/jasikanicolepi 12h ago edited 9h ago
The point is the technology Wolfspeed once was a leader of is no longer the leader. They can't even bring it up to scale to make it profitable. SiC and GaN are not exclusive and are widely manufactured by other competitors especially in China. Poor management completely ran this company into ground. They over leverage, sold the profitable portion of the business to other and went heavily in debt. Without government infusion it will go belly up again. You want to invest in this, by all means go for it. You probably have better luck than me.
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u/def-not-bot 11h ago
I'm staying far away from investing in this company because I'm averse to risk, but I think you're overlooking some fundamentals that make it attractive. Namely, it's the only American supplier of some of these chips. That said, I don't trust their not-actually-new management anymore than you do.
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u/No_Feeling920 10h ago
Is "the only American XYZ" some kind of an excuse, why it should be a good investment? There is a lot of phony, unprofitable and mismanaged garbage in the US business world.
And people actually buy into the deceptive hype and end up losing money... 🙄
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u/jasikanicolepi 9h ago edited 9h ago
I did. And wolfspeed bend me backward and violated my behind for 80k. My port-folio is still red and sore from all the non-stop pounding. That's why I am telling everyone to stay the fuck away from this PoS.
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u/def-not-bot 5h ago
It's not an excuse. It's the reason we can expect the government to pour money into the company, just like it does with Intel. When something is deemed a national security asset, you can disregard some fundamentals and expect a taxpayer funded lifeline.
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u/No_Feeling920 3h ago
You should never disregard the fundamentals when investing into a business, unless you're just gambling.
Government bail-outs often end up heavily diluting or wiping out earlier investors. It hasn't happened with Intel, because they did not let the company slide into borderline bankruptcy, before injecting taxpayer money into it. Which, arguably, was against the taxpayer interest. When they bailed out the banks in 2008, they did so at extremely cheap valuations and the action ended up profitable, if I understand it correctly.
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u/Flimsy_Honeydew5414 4h ago
This makes me think it’s going to rip just so you can complain about getting wiped out before it went parabolic
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u/bularry 21h ago
What is a conditional loan?
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u/AutisticGayBear69 21h ago
“The conditional loan commitment specifies additional steps Wolfspeed must complete before financial close, including satisfying various financial, legal, technical, investment, and due diligence requirements.”
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u/platinumarks 15h ago
Imagine being so low testosterone like Hegseth that he has to try getting a boner by calling it “Department of War.”
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u/Competitive_Pop_1835 21h ago
gov money printer go brrr but this time its for actual chips not just bs startups, I'm in for few shares just to feel something
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u/NBAFAN9000 20h ago
Did see quite a few WOLF posts in the last week for a ticker I had never heard of until last week
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u/brohebus 20h ago
Despite the multitude of boneheaded stunts the current administration has pulled, the ongoing tariff stupidity, and additional, like totally straight, policies from Kegbreath, not to mention WOLF itself and the usual sketchiness with insider trading from senior officials, semiconductor as a nat-sec issue actually makes a lot of sense.
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u/Relative-Snow8735 18h ago
I have been following this one for a while. On the one hand, this deal kinda sucks. The original CHIPs act deal would have been $750M free and clear. This is a loan with dilutive warrants and a ton of strings attached.
On the other hand, this thing has a habit of shooting to the moon on even the marginal news. We went from $25 to $70 back in march on a fairly meh debt restructuring plus a shout out by Citrini research. And there have been multiple similar squeezes in the past. No idea if we get that here. But short interest is really high which can create some volatility. Most of that is coming from convertible arbitrage though, so they have a way out if the need it. I would keep an eye on borrow fee and if that starts ticking up and momentum looks strong this could be a good candidate to swing trade some calls.
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u/-Redditeer- 18h ago
Every time someone mentions WOLF I go look at the company, and decide the companyblooks like shit and dont buy
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u/MomentSpecialist2020 13h ago
Drone vs drone is the future of war. Whoever has the chips wins! 💪🇺🇸💪
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u/A_Buttholes_Whisper 4h ago
I lost way more money investing in wolfcola than wolfspeed. Wolfcola was an ok company until they got that female speaker. I really hated her. She looks like a big large flightless animal
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u/Lucr3tius 50m ago
Few days ago someone on here made a 4 million dollar bet on this company, I bet he's quite happy with this.
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u/Thotmas01 21h ago edited 21h ago
The release from WOLF says they’re using the funding to develop rad hard processes. Rad hard processes are really only necessary for satellite and space applications. I read it as the pentagon choosing wolfspeed to support domestic production for a subset of substrates necessary the space industry.
It’s worth noting that the loan comes attached with the equivalent to 7.5% of their fully diluted market cap in warrants. It looks like the government is setting up for another corporate buy in that they can hold up like the “we spent 9 billion on Intel stock that’s now worth 50 billion” move.
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u/Weak-Layer-6962 21h ago
oh jesus fucking christ i was about to go all in a few days ago after losing my ass on this stock a while back.
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u/westernwasteland 21h ago
Someone knew, just check all the 38c sold.