Wolfspeed to File for U.S. Bankruptcy Under Debt Restructuring Deal with Creditors

Wolfspeed Inc. (NYSE: WOLF), a U.S.-based chipmaker, announced on June 22 that it intends to file for Chapter 11 bankruptcy protection under a prepackaged restructuring agreement designed to reduce its total debt burden by nearly 70%. The plan, supported by key creditors and Renesas Electronics Corp.'s U.S. subsidiary, includes $275 million in new financing to support operations during the restructuring period.

As of March 2025, Wolfspeed held approximately $1.33 billion in cash but was saddled with $6.5 billion in total debt obligations. The prearranged bankruptcy strategy will allow Wolfspeed to maintain day-to-day operations while executing the court-supervised reorganization. The company stated its objective is to secure court approval of the plan and emerge from bankruptcy by the end of the third quarter of the 2025 calendar year.

The planned restructuring comes after Wolfspeed expressed “going concern” doubts in May, citing ongoing financial strain driven by weakening global demand and policy-related uncertainty stemming from shifting U.S. trade dynamics. These pressures have contributed to mounting losses and unsustainable debt levels.

Under the agreement, a portion of Wolfspeed’s creditors—including Apollo Global Management (NYSE: APO)—are expected to take control of the business post-bankruptcy. In 2023, Apollo led a $1.25 billion debt financing round for Wolfspeed, which included an option to increase the amount to $2 billion in support of the company’s U.S. manufacturing expansion strategy.

Leadership changes have accompanied the financial restructuring. Industry veteran Robert Feurle was appointed CEO in March 2025, followed by the hiring of David Emerson as Chief Operating Officer in May. That same month, Wolfspeed announced a 30% reduction in its senior executive team as part of broader efforts to streamline its leadership structure and stabilize operations.

Bloomberg News first reported the potential bankruptcy filing earlier in June, noting creditor-backed plans for corporate control as part of the reorganization. The prepackaged nature of the filing is expected to allow for a quicker, more orderly resolution compared to traditional bankruptcy proceedings.