Wolfspeed stock surges 20% on $1.5 billion defense loan

Investing.com -- Shares of Wolfspeed Inc. (NYSE: WOLF) jumped 20% in after-hours trading Wednesday after the Department of War announced a conditional $1.5 billion loan to the semiconductor manufacturer.

The proposed 30-year loan is designed to boost U.S. production of advanced computer chips and specialized materials. This funding aims to strengthen the American supply chain for components vital to national security, Super Intelligence applications, and critical infrastructure.

According to the Department of War, the financing aligns with President Trump’s push to expand domestic chip manufacturing. The loan will support the creation of advanced tech materials essential for modern defense systems, including drones, high-performance engines, radars, and missile defense.

Wolfspeed plans to use the money to upgrade its manufacturing technology for next-generation communications and defense electronics. The company also aims to make its current and future chips more durable against radiation damage.

As part of the deal, Wolfspeed would give the Department of War the right to buy up to 7.5% of the company’s total stock. These buying rights would be granted in stages as the loan money is handed out.

Before the deal is finalized, Wolfspeed must still pass standard financial, legal, and technical reviews, alongside receiving final government approvals.

Wolfspeed currently runs manufacturing facilities in North Carolina, New York, and Arkansas, where it produces these highly specialized chips and materials from start to finish.

Original Article

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