Wolfspeed Stock Doubles as AI Power Demand Ignites Rally

Wolfspeed (WOLF), a semiconductor company that filed for Chapter 11 bankruptcy in June 2025, has staged a stunning comeback this month. Its stock surged 100% through May 20, making it the top-performing U.S. semiconductor stock and more than doubling the gain of industry giant Micron (MU).

This dramatic move follows one of the most brutal collapses in recent chip history. Wolfspeed shares are still down about 99.6% from their 2021 peak, when it was a darling of the electric-vehicle supply chain trade. The company's aggressive spending on silicon carbide (SiC) manufacturing expansion ultimately led to its financial implosion.

Now, the very infrastructure that nearly destroyed the company is being reframed as a potential goldmine. Independent research firm Citrini Research published a report last week naming Wolfspeed as its 'single-stock highlight' for the next phase of AI infrastructure.

The core thesis is that AI data centers are becoming so power-hungry that they require a complete redesign of power systems. This creates massive new demand for silicon carbide components, which is Wolfspeed's core business. Citrini argues that Wolfspeed's multi-billion dollar manufacturing fabs are now 'irreplaceable assets' for the AI buildout.

This rally matters because it signals a potential shift in the AI investment theme beyond just chips that process data (like GPUs) to chips that deliver power. As AI racks consume hundreds of kilowatts, efficient power conversion becomes a critical bottleneck, putting companies like Wolfspeed in the spotlight.

For Wolfspeed specifically, the timing aligns with a radically cleaned-up balance sheet. The company emerged from a prepackaged bankruptcy in September 2025, eliminating roughly $4.6 billion in debt. With its debt overhang gone and about $1.2 billion in cash, the market is now free to value its physical assets based on future AI demand.

The company also holds a key technological edge. In January 2026, Wolfspeed demonstrated production of a 300mm silicon carbide crystal, a milestone only achieved by one other company, Coherent (COHR). Larger wafers improve manufacturing economics and are better suited for advanced AI packaging, giving Wolfspeed a potential long-term advantage.

If Citrini's estimates are correct—that AI infrastructure could account for half of global silicon carbide demand by 2030—then companies with proven scale and technology could be massively revalued. This news challenges investors to look beyond traditional AI winners and consider the entire infrastructure stack, from compute to power delivery.