Wolfspeed (WOLF.US), a silicon carbide chip manufacturer, receives a loan of up to 1.5 billions USD from the U.S. Department of Defense and surges after hours.
The US Department of Defense has committed to providing Wolfspeed, a silicon carbide chip manufacturer, with a conditional loan of up to $1.5 billions to support the company's development of materials it describes as critical to national security.
According to Golden Ten Data APP, the US Department of Defense has pledged to provide a conditional loan of up to $1.5 billion to silicon carbide chip manufacturer Wolfspeed (WOLF.US), to support the company's development of materials it claims are critical to national security. Boosted by this news, as of press time, Wolfspeed's shares surged nearly 19% in after-hours US trading on Wednesday.
According to a statement released by Wolfspeed, the US government has issued the company a conditional letter of commitment, agreeing to provide up to $1.5 billion in senior secured financing with a 30-year term. Under the terms of the transaction currently under negotiation, in exchange, Wolfspeed will issue warrants to the US Department of Defense, allowing it to purchase shares in batches equivalent to up to 7.5% of Wolfspeed's equity.
Headquartered in North Carolina, Wolfspeed filed for bankruptcy in July 2025, after persistent problems at a key plant producing silicon carbide wafers. As part of the Biden administration's chip initiative, Wolfspeed had previously received $750 million in funding, but US President Trump had fiercely criticized the project since taking office. The Trump administration has been readjusting several funding grants, and prior to the bankruptcy filing, Wolfspeed had only received a portion of the allocated funds.
On Wednesday, Wolfspeed stated that the company will use government financing to produce silicon carbide materials and wide bandgap power devices, which are used in power electronics for the telecommunications, aerospace, and defense industries. The company also plans to use this funding to upgrade its capabilities to supply a material used in warfare communications systems.
The Trump administration has shown willingness to directly invest in companies it deems critical to US national security and to provide loans to such businesses. Last year, the US government took an equity stake in chip manufacturer Intel (INTC.US). This May, the US Department of Commerce announced it would provide over $2 billion in funding in exchange for non-controlling stakes in a group of quantum computing companies.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Bernstein lowers McDonald's target price to $250
Bernstein has lowered the target price of McDonald's (MCD.US) from $295 to $250.
French electricity delivery price for next year surpasses 100 euros for the first time since 2023
Sources indicate that next year’s French power delivery price has surpassed 100 euros for the first time since 2023.
Bond market turmoil raises Swiss franc short squeeze risk
(1) The impact of arbitrage trading on the Swiss franc has been very significant, with the franc's trade-weighted exchange rate falling sharply this year. (2) However, as currency volatility intensifies and risk aversion increases due to turbulence in the bond and energy markets, the market may have reasons to hedge against the risk of a franc rebound. (3) During the period from February to September 2026, which saw both arbitrage trading and a booming stock market, the franc’s trade-weighted exchange rate declined by about 5.5%, dropping from 114 to around 108—the lowest point since February 2025. (4) This low is close to several important technical indicators, including the 100-month moving average near 107.5 and the lower band of the 20-month Bollinger Bands, also near 107.5. (5) This decline is a correction following a larger price surge and may provide a platform for the franc to resume its upward momentum, especially since the current exchange rate has deviated from the 100-month moving average, and the franc has not traded below this average since 2023. (6) Given the potential formation of a bottom, franc short-sellers may have reasons to reduce their risk exposure following the increase in currency volatility and anxiety in the stock market triggered by bond market turmoil. (7) Such actions directly threaten arbitrage trading; considering the magnitude of the franc’s decline, there may still be a large number of short franc positions in the market. (8) If these positions are closed, it could trigger a further rise in the franc, which can be volatile; in October, it fell by 2.4% within just two trading days. (9) Going forward, attention should be paid to volatility in the bond market and the evolution of risk aversion sentiment. If risk appetite continues to weaken, franc short covering could become an important short-term variable in the foreign exchange market.
Crypto prices
More
