00008954196/252023Q3FALSEhttp://fasb.org/us-gaap/2022#AccountingStandardsUpdate202006Memberhttp://fasb.org/us-gaap/2022#OtherAssetsNoncurrenthttp://fasb.org/us-gaap/2022#OtherAssetsNoncurrenthttp://fasb.org/us-gaap/2022#OtherLiabilitiesCurrenthttp://fasb.org/us-gaap/2022#OtherLiabilitiesCurrenthttp://fasb.org/us-gaap/2022#OtherLiabilitiesNoncurrenthttp://fasb.org/us-gaap/2022#OtherLiabilitiesNoncurrenthttp://fasb.org/us-gaap/2022#PropertyPlantAndEquipmentAndFinanceLeaseRightOfUseAssetAfterAccumulatedDepreciationAndAmortizationhttp://fasb.org/us-gaap/2022#PropertyPlantAndEquipmentAndFinanceLeaseRightOfUseAssetAfterAccumulatedDepreciationAndAmortization16.67451.002722220.02113460.00786020.008411800008954192022-06-272023-03-2600008954192023-04-21xbrli:shares00008954192023-03-26iso4217:USD00008954192022-06-26iso4217:USDxbrli:shares00008954192022-12-262023-03-2600008954192021-12-272022-03-2700008954192021-06-282022-03-270000895419us-gaap:CommonStockMember2022-06-260000895419us-gaap:AdditionalPaidInCapitalMember2022-06-260000895419us-gaap:RetainedEarningsMember2022-06-260000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-06-260000895419us-gaap:RetainedEarningsMember2022-06-272022-09-2500008954192022-06-272022-09-250000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-06-272022-09-250000895419us-gaap:AdditionalPaidInCapitalMember2022-06-272022-09-250000895419us-gaap:CommonStockMember2022-06-272022-09-250000895419srt:CumulativeEffectPeriodOfAdoptionAdjustmentMemberus-gaap:AdditionalPaidInCapitalMember2022-06-260000895419us-gaap:RetainedEarningsMembersrt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2022-06-260000895419srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2022-06-260000895419us-gaap:CommonStockMember2022-09-250000895419us-gaap:AdditionalPaidInCapitalMember2022-09-250000895419us-gaap:RetainedEarningsMember2022-09-250000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-09-2500008954192022-09-250000895419us-gaap:RetainedEarningsMember2022-09-262022-12-2500008954192022-09-262022-12-250000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-09-262022-12-250000895419us-gaap:AdditionalPaidInCapitalMember2022-09-262022-12-250000895419us-gaap:CommonStockMember2022-09-262022-12-250000895419us-gaap:CommonStockMember2022-12-250000895419us-gaap:AdditionalPaidInCapitalMember2022-12-250000895419us-gaap:RetainedEarningsMember2022-12-250000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-12-2500008954192022-12-250000895419us-gaap:RetainedEarningsMember2022-12-262023-03-260000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-12-262023-03-260000895419us-gaap:AdditionalPaidInCapitalMember2022-12-262023-03-260000895419us-gaap:CommonStockMember2022-12-262023-03-260000895419us-gaap:CommonStockMember2023-03-260000895419us-gaap:AdditionalPaidInCapitalMember2023-03-260000895419us-gaap:RetainedEarningsMember2023-03-260000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-03-260000895419us-gaap:CommonStockMember2021-06-270000895419us-gaap:AdditionalPaidInCapitalMember2021-06-270000895419us-gaap:RetainedEarningsMember2021-06-270000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-06-2700008954192021-06-270000895419us-gaap:RetainedEarningsMember2021-06-282021-09-2600008954192021-06-282021-09-260000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-06-282021-09-260000895419us-gaap:AdditionalPaidInCapitalMember2021-06-282021-09-260000895419us-gaap:CommonStockMember2021-06-282021-09-260000895419us-gaap:CommonStockMember2021-09-260000895419us-gaap:AdditionalPaidInCapitalMember2021-09-260000895419us-gaap:RetainedEarningsMember2021-09-260000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-09-2600008954192021-09-260000895419us-gaap:RetainedEarningsMember2021-09-272021-12-2600008954192021-09-272021-12-260000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-09-272021-12-260000895419us-gaap:AdditionalPaidInCapitalMember2021-09-272021-12-260000895419us-gaap:CommonStockMember2021-09-272021-12-260000895419us-gaap:CommonStockMember2021-12-260000895419us-gaap:AdditionalPaidInCapitalMember2021-12-260000895419us-gaap:RetainedEarningsMember2021-12-260000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-2600008954192021-12-260000895419us-gaap:RetainedEarningsMember2021-12-272022-03-270000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-272022-03-270000895419us-gaap:AdditionalPaidInCapitalMember2021-12-272022-03-270000895419us-gaap:CommonStockMember2021-12-272022-03-270000895419us-gaap:CommonStockMember2022-03-270000895419us-gaap:AdditionalPaidInCapitalMember2022-03-270000895419us-gaap:RetainedEarningsMember2022-03-270000895419us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-2700008954192022-03-270000895419us-gaap:AccountingStandardsUpdate202006Membersrt:CumulativeEffectPeriodOfAdoptionAdjustmentMemberus-gaap:AdditionalPaidInCapitalMember2022-06-260000895419us-gaap:AccountingStandardsUpdate202006Membersrt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2022-06-270000895419us-gaap:AccountingStandardsUpdate202006Memberus-gaap:RetainedEarningsMembersrt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2022-06-260000895419us-gaap:DiscontinuedOperationsDisposedOfBySaleMemberwolf:LEDBusinessMember2021-03-012021-03-010000895419us-gaap:DiscontinuedOperationsDisposedOfBySaleMemberwolf:LEDBusinessMember2021-03-010000895419us-gaap:DiscontinuedOperationsDisposedOfBySaleMemberwolf:LEDBusinessMembersrt:MinimumMember2021-03-010000895419srt:MaximumMemberus-gaap:DiscontinuedOperationsDisposedOfBySaleMemberwolf:LEDBusinessMember2021-03-010000895419us-gaap:DiscontinuedOperationsDisposedOfBySaleMemberwolf:LEDBusinessMember2021-06-282022-03-2700008954192021-03-012021-03-010000895419srt:MaximumMemberus-gaap:DiscontinuedOperationsDisposedOfBySaleMemberwolf:LEDBusinessMember2021-03-012021-03-010000895419us-gaap:DiscontinuedOperationsDisposedOfBySaleMemberwolf:LEDBusinessMember2021-12-272022-03-270000895419us-gaap:DiscontinuedOperationsDisposedOfBySaleMemberwolf:LEDBusinessMember2022-09-250000895419wolf:LEDBusinessRealEstateLicenseAgreementMemberus-gaap:DiscontinuedOperationsDisposedOfBySaleMember2022-12-262023-03-260000895419wolf:LEDBusinessRealEstateLicenseAgreementMemberus-gaap:DiscontinuedOperationsDisposedOfBySaleMember2022-06-272023-03-260000895419wolf:LEDBusinessRealEstateLicenseAgreementMemberus-gaap:DiscontinuedOperationsDisposedOfBySaleMemberus-gaap:AccountsReceivableMember2022-06-272023-03-260000895419wolf:LEDBusinessRealEstateLicenseAgreementMemberus-gaap:DiscontinuedOperationsDisposedOfBySaleMember2021-12-272022-03-270000895419wolf:LEDBusinessRealEstateLicenseAgreementMemberus-gaap:DiscontinuedOperationsDisposedOfBySaleMember2021-06-282022-03-270000895419wolf:LEDBusinessTransitionServicesAgreementMemberus-gaap:DiscontinuedOperationsDisposedOfBySaleMember2022-12-262023-03-260000895419wolf:LEDBusinessTransitionServicesAgreementMemberus-gaap:DiscontinuedOperationsDisposedOfBySaleMember2022-06-272023-03-260000895419wolf:LEDBusinessTransitionServicesAgreementMemberus-gaap:DiscontinuedOperationsDisposedOfBySaleMemberus-gaap:AccountsReceivableMember2022-06-272023-03-260000895419wolf:LEDBusinessTransitionServicesAgreementMemberus-gaap:DiscontinuedOperationsDisposedOfBySaleMember2021-12-272022-03-270000895419wolf:LEDBusinessTransitionServicesAgreementMemberus-gaap:DiscontinuedOperationsDisposedOfBySaleMember2021-06-282022-03-270000895419us-gaap:DiscontinuedOperationsDisposedOfBySaleMemberwolf:LEDBusinessMember2023-03-260000895419us-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMembersrt:EuropeMember2022-12-262023-03-26xbrli:pure0000895419us-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMembersrt:EuropeMember2021-12-272022-03-270000895419us-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMembersrt:EuropeMember2022-06-272023-03-260000895419us-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMembersrt:EuropeMember2021-06-282022-03-270000895419country:CNus-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMember2022-12-262023-03-260000895419country:CNus-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMember2021-12-272022-03-270000895419country:CNus-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMember2022-06-272023-03-260000895419country:CNus-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMember2021-06-282022-03-270000895419country:USus-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMember2022-12-262023-03-260000895419country:USus-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMember2021-12-272022-03-270000895419country:USus-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMember2022-06-272023-03-260000895419country:USus-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMember2021-06-282022-03-270000895419wolf:AsiaPacificExcludingChinaMemberus-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMember2022-12-262023-03-260000895419wolf:AsiaPacificExcludingChinaMemberus-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMember2021-12-272022-03-270000895419wolf:AsiaPacificExcludingChinaMemberus-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMember2022-06-272023-03-260000895419wolf:AsiaPacificExcludingChinaMemberus-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMember2021-06-282022-03-270000895419us-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMemberwolf:OtherGeographicAreaMember2022-12-262023-03-260000895419us-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMemberwolf:OtherGeographicAreaMember2021-12-272022-03-270000895419us-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMemberwolf:OtherGeographicAreaMember2022-06-272023-03-260000895419us-gaap:GeographicConcentrationRiskMemberus-gaap:RevenueFromContractWithCustomerMemberwolf:OtherGeographicAreaMember2021-06-282022-03-270000895419us-gaap:RevenueFromContractWithCustomerMemberus-gaap:GeographicConcentrationRiskMember2022-12-262023-03-260000895419us-gaap:RevenueFromContractWithCustomerMemberus-gaap:GeographicConcentrationRiskMember2021-12-272022-03-270000895419us-gaap:RevenueFromContractWithCustomerMemberus-gaap:GeographicConcentrationRiskMember2022-06-272023-03-260000895419us-gaap:RevenueFromContractWithCustomerMemberus-gaap:GeographicConcentrationRiskMember2021-06-282022-03-270000895419stpr:NY2023-03-26utr:sqft0000895419us-gaap:BilledRevenuesMember2023-03-260000895419us-gaap:BilledRevenuesMember2022-06-260000895419us-gaap:UnbilledRevenuesMember2023-03-260000895419us-gaap:UnbilledRevenuesMember2022-06-260000895419us-gaap:RoyaltyMember2023-03-260000895419us-gaap:RoyaltyMember2022-06-260000895419us-gaap:AllowanceForNotesReceivableMember2022-06-260000895419us-gaap:AllowanceForNotesReceivableMember2022-06-272023-03-260000895419us-gaap:AllowanceForNotesReceivableMember2023-03-260000895419us-gaap:AccumulatedOtherComprehensiveIncomeMembersrt:MaximumMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-06-272023-03-260000895419us-gaap:AccumulatedOtherComprehensiveIncomeMembersrt:MaximumMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-12-262023-03-260000895419us-gaap:AccumulatedOtherComprehensiveIncomeMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-06-282022-03-270000895419us-gaap:CorporateBondSecuritiesMember2023-03-260000895419us-gaap:USTreasurySecuritiesMember2023-03-260000895419us-gaap:CertificatesOfDepositMember2023-03-260000895419us-gaap:MunicipalBondsMember2023-03-260000895419us-gaap:USGovernmentAgenciesDebtSecuritiesMember2023-03-260000895419us-gaap:VariableRateDemandObligationMember2023-03-260000895419us-gaap:CommercialPaperMember2023-03-260000895419us-gaap:CorporateBondSecuritiesMember2022-06-260000895419us-gaap:MunicipalBondsMember2022-06-260000895419us-gaap:USTreasurySecuritiesMember2022-06-260000895419us-gaap:VariableRateDemandObligationMember2022-06-260000895419us-gaap:USGovernmentAgenciesDebtSecuritiesMember2022-06-26wolf:security0000895419us-gaap:CashAndCashEquivalentsMember2023-03-260000895419us-gaap:CashAndCashEquivalentsMember2022-06-260000895419us-gaap:FairValueInputsLevel1Memberus-gaap:MoneyMarketFundsMember2023-03-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMember2023-03-260000895419us-gaap:MoneyMarketFundsMember2023-03-260000895419us-gaap:FairValueInputsLevel1Memberus-gaap:MoneyMarketFundsMember2022-06-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMember2022-06-260000895419us-gaap:MoneyMarketFundsMember2022-06-260000895419us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueInputsLevel1Member2023-03-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:USTreasurySecuritiesMember2023-03-260000895419us-gaap:USTreasurySecuritiesMember2023-03-260000895419us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueInputsLevel1Member2022-06-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:USTreasurySecuritiesMember2022-06-260000895419us-gaap:USTreasurySecuritiesMember2022-06-260000895419us-gaap:FairValueInputsLevel1Memberus-gaap:CommercialPaperMember2023-03-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:CommercialPaperMember2023-03-260000895419us-gaap:CommercialPaperMember2023-03-260000895419us-gaap:FairValueInputsLevel1Memberus-gaap:CommercialPaperMember2022-06-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:CommercialPaperMember2022-06-260000895419us-gaap:CommercialPaperMember2022-06-260000895419us-gaap:FairValueInputsLevel1Member2023-03-260000895419us-gaap:FairValueInputsLevel2Member2023-03-260000895419us-gaap:FairValueInputsLevel1Member2022-06-260000895419us-gaap:FairValueInputsLevel2Member2022-06-260000895419us-gaap:FairValueInputsLevel1Memberus-gaap:CorporateBondSecuritiesMember2023-03-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:CorporateBondSecuritiesMember2023-03-260000895419us-gaap:FairValueInputsLevel1Memberus-gaap:CorporateBondSecuritiesMember2022-06-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:CorporateBondSecuritiesMember2022-06-260000895419us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueInputsLevel1Member2023-03-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:USTreasurySecuritiesMember2023-03-260000895419us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueInputsLevel1Member2022-06-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:USTreasurySecuritiesMember2022-06-260000895419us-gaap:FairValueInputsLevel1Memberus-gaap:CertificatesOfDepositMember2023-03-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:CertificatesOfDepositMember2023-03-260000895419us-gaap:FairValueInputsLevel1Memberus-gaap:CertificatesOfDepositMember2022-06-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:CertificatesOfDepositMember2022-06-260000895419us-gaap:CertificatesOfDepositMember2022-06-260000895419us-gaap:FairValueInputsLevel1Memberus-gaap:MunicipalBondsMember2023-03-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:MunicipalBondsMember2023-03-260000895419us-gaap:FairValueInputsLevel1Memberus-gaap:MunicipalBondsMember2022-06-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:MunicipalBondsMember2022-06-260000895419us-gaap:USGovernmentAgenciesDebtSecuritiesMemberus-gaap:FairValueInputsLevel1Member2023-03-260000895419us-gaap:USGovernmentAgenciesDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Member2023-03-260000895419us-gaap:USGovernmentAgenciesDebtSecuritiesMemberus-gaap:FairValueInputsLevel1Member2022-06-260000895419us-gaap:USGovernmentAgenciesDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Member2022-06-260000895419us-gaap:VariableRateDemandObligationMemberus-gaap:FairValueInputsLevel1Member2023-03-260000895419us-gaap:VariableRateDemandObligationMemberus-gaap:FairValueInputsLevel2Member2023-03-260000895419us-gaap:VariableRateDemandObligationMemberus-gaap:FairValueInputsLevel1Member2022-06-260000895419us-gaap:VariableRateDemandObligationMemberus-gaap:FairValueInputsLevel2Member2022-06-260000895419us-gaap:CommercialPaperNotIncludedWithCashAndCashEquivalentsMemberus-gaap:FairValueInputsLevel1Member2023-03-260000895419us-gaap:CommercialPaperNotIncludedWithCashAndCashEquivalentsMemberus-gaap:FairValueInputsLevel2Member2023-03-260000895419us-gaap:CommercialPaperNotIncludedWithCashAndCashEquivalentsMember2023-03-260000895419us-gaap:CommercialPaperNotIncludedWithCashAndCashEquivalentsMemberus-gaap:FairValueInputsLevel1Member2022-06-260000895419us-gaap:CommercialPaperNotIncludedWithCashAndCashEquivalentsMemberus-gaap:FairValueInputsLevel2Member2022-06-260000895419us-gaap:CommercialPaperNotIncludedWithCashAndCashEquivalentsMember2022-06-260000895419us-gaap:CustomerRelationshipsMember2023-03-260000895419us-gaap:CustomerRelationshipsMember2022-06-260000895419us-gaap:DevelopedTechnologyRightsMember2023-03-260000895419us-gaap:DevelopedTechnologyRightsMember2022-06-260000895419us-gaap:NoncompeteAgreementsMember2023-03-260000895419us-gaap:NoncompeteAgreementsMember2022-06-260000895419wolf:AcquisitionRelatedIntangibleAssetsMember2023-03-260000895419wolf:AcquisitionRelatedIntangibleAssetsMember2022-06-260000895419wolf:PatentandLicenseRightsMember2023-03-260000895419wolf:PatentandLicenseRightsMember2022-06-260000895419wolf:PatentandLicenseRightsMember2022-12-262023-03-260000895419wolf:PatentandLicenseRightsMember2022-06-272023-03-260000895419wolf:PatentandLicenseRightsMember2021-12-272022-03-270000895419wolf:PatentandLicenseRightsMember2021-06-282022-03-270000895419us-gaap:LineOfCreditMember2023-03-260000895419us-gaap:LineOfCreditMember2022-06-272023-03-260000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesdueSeptember12023Member2018-08-240000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesdueSeptember12023Member2018-08-242018-08-240000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesdueSeptember12023Member2020-04-012020-04-300000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesDueMay12026Member2020-04-210000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesDueMay12026Member2020-04-212020-04-21wolf:day0000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesDueMay12026Member2020-04-012020-04-300000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesDue2028Member2022-02-030000895419wolf:UnderwritersMemberus-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesDue2028Member2022-02-030000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesDue2028Member2022-02-032022-02-0300008954192022-01-310000895419wolf:ConvertibleNotesDue2029Memberus-gaap:ConvertibleDebtMember2022-11-210000895419wolf:ConvertibleNotesDue2029Memberwolf:UnderwritersMemberus-gaap:ConvertibleDebtMember2022-11-210000895419wolf:ConvertibleNotesDue2029Memberus-gaap:ConvertibleDebtMember2022-11-212022-11-2100008954192022-11-160000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesdueSeptember12023Member2023-03-260000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesDueMay12026Member2023-03-260000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesDue2028Member2023-03-260000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesdueSeptember12023Member2020-03-302020-06-280000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesdueSeptember12023Member2021-12-080000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesdueSeptember12023Member2022-12-262023-03-260000895419us-gaap:ConvertibleDebtMember2023-03-260000895419us-gaap:ConvertibleDebtMember2022-06-260000895419us-gaap:ConvertibleDebtMember2022-12-262023-03-260000895419us-gaap:ConvertibleDebtMember2021-12-272022-03-270000895419us-gaap:ConvertibleDebtMember2022-06-272023-03-260000895419us-gaap:ConvertibleDebtMember2021-06-282022-03-270000895419us-gaap:ConvertibleDebtMemberwolf:ConversionCircumstanceOneMember2022-06-272023-03-260000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesDueMay12026Member2022-06-272023-03-260000895419us-gaap:FairValueInputsLevel2Memberus-gaap:ConvertibleDebtMember2023-03-260000895419us-gaap:ConvertibleDebtMemberwolf:ConvertibleNotesdueSeptember12023Member2021-12-242021-12-240000895419wolf:ConvertibleNotesdueSeptember12023Member2021-12-082021-12-08wolf:compensationPlan0000895419us-gaap:EmployeeStockMember2023-03-260000895419us-gaap:EmployeeStockMember2022-06-272023-03-26wolf:stockPurchase0000895419wolf:RestrictedStockAwardsAndRestrictedStockUnitsMember2022-06-260000895419wolf:RestrictedStockAwardsAndRestrictedStockUnitsMember2022-06-272023-03-260000895419wolf:RestrictedStockAwardsAndRestrictedStockUnitsMember2023-03-260000895419us-gaap:CostOfSalesMember2022-12-262023-03-260000895419us-gaap:CostOfSalesMember2021-12-272022-03-270000895419us-gaap:CostOfSalesMember2022-06-272023-03-260000895419us-gaap:CostOfSalesMember2021-06-282022-03-270000895419us-gaap:ResearchAndDevelopmentExpenseMember2022-12-262023-03-260000895419us-gaap:ResearchAndDevelopmentExpenseMember2021-12-272022-03-270000895419us-gaap:ResearchAndDevelopmentExpenseMember2022-06-272023-03-260000895419us-gaap:ResearchAndDevelopmentExpenseMember2021-06-282022-03-270000895419us-gaap:SellingGeneralAndAdministrativeExpensesMember2022-12-262023-03-260000895419us-gaap:SellingGeneralAndAdministrativeExpensesMember2021-12-272022-03-270000895419us-gaap:SellingGeneralAndAdministrativeExpensesMember2022-06-272023-03-260000895419us-gaap:SellingGeneralAndAdministrativeExpensesMember2021-06-282022-03-270000895419srt:MaximumMember2023-03-2600008954192020-03-302020-06-28wolf:endowedFacultyChair0000895419srt:MinimumMember2022-06-272023-03-260000895419srt:MaximumMember2022-06-272023-03-26
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 26, 2023
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             
Commission file number 001-40863
__________________________________________ 
WOLFSPEED, INC.
(Exact name of registrant as specified in its charter)
North Carolina 56-1572719
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
4600 Silicon Drive 
DurhamNorth Carolina27703
(Address of principal executive offices) (Zip Code)
(919) 407-5300
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.00125 par valueWOLFNew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Securities Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes No
The number of shares outstanding of the registrant’s common stock, par value $0.00125 per share, as of April 21, 2023, was 124,474,270.


Table of Contents
WOLFSPEED, INC.
FORM 10-Q
For the Quarterly Period Ended March 26, 2023
Table of Contents

2

Table of Contents
PART I - FINANCIAL INFORMATION
Item 1.    Financial Statements (Unaudited)
3

Table of Contents
WOLFSPEED, INC.
UNAUDITED CONSOLIDATED BALANCE SHEETS
in millions of U.S. Dollars, except share data in thousandsMarch 26, 2023June 26, 2022
Assets
Current assets:
Cash and cash equivalents$795.1 $449.5 
Short-term investments1,453.1 749.3 
Total cash, cash equivalents and short-term investments2,248.2 1,198.8 
Accounts receivable, net164.0 150.2 
Inventories288.9 227.0 
Income taxes receivable1.1 1.3 
Prepaid expenses34.6 32.1 
Other current assets112.0 151.4 
Current assets held for sale 1.6 
Total current assets2,848.8 1,762.4 
Property and equipment, net1,904.0 1,481.1 
Goodwill359.2 359.2 
Intangible assets, net118.0 125.4 
Long-term receivables2.7 104.7 
Deferred tax assets1.0 1.0 
Other assets221.0 83.7 
Total assets$5,454.7 $3,917.5 
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accrued expenses$522.2 $307.7 
Accrued contract liabilities41.5 37.0 
Income taxes payable9.5 11.6 
Finance lease liabilities0.5 0.5 
Other current liabilities33.5 31.7 
Total current liabilities607.2 388.5 
Long-term liabilities:
Convertible notes, net3,023.3 1,021.6 
Deferred tax liabilities3.7 3.2 
Finance lease liabilities - long-term9.3 9.6 
Other long-term liabilities104.4 55.3 
Total long-term liabilities3,140.7 1,089.7 
Commitments and contingencies
Shareholders’ equity:
Preferred stock, par value $0.01; 3,000 shares authorized at March 26, 2023 and June 26, 2022; none issued and outstanding
  
Common stock, par value $0.00125; 200,000 shares authorized at March 26, 2023 and June 26, 2022; 124,437 and 123,795 shares issued and outstanding at March 26, 2023 and June 26, 2022, respectively
0.2 0.2 
Additional paid-in-capital3,680.6 4,228.4 
Accumulated other comprehensive loss(23.1)(25.3)
Accumulated deficit(1,950.9)(1,764.0)
Total shareholders’ equity1,706.8 2,439.3 
Total liabilities and shareholders’ equity$5,454.7 $3,917.5 
The accompanying notes are an integral part of the consolidated financial statements
4

Table of Contents
WOLFSPEED, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
 
 Three months endedNine months ended
 March 26, 2023March 27, 2022March 26, 2023March 27, 2022
in millions of U.S. Dollars, except share data
Revenue, net$228.7 $188.0 $686.1 $517.7 
Cost of revenue, net160.6 124.0 471.2 347.3 
Gross profit68.1 64.0 214.9 170.4 
Operating expenses:
Research and development56.1 48.1 168.3 148.2 
Sales, general and administrative60.5 51.5 171.2 148.5 
Amortization or impairment of acquisition-related intangibles2.6 3.4 8.3 10.6 
Loss (gain) on disposal or impairment of other assets1.7 (0.6)1.9 (0.3)
Other operating expense49.1 23.9 134.1 52.3 
Operating loss(101.9)(62.3)(268.9)(188.9)
Non-operating (income) expense, net(2.9)3.8 (53.4)35.7 
Loss before income taxes(99.0)(66.1)(215.5)(224.6)
Income tax expense0.5 0.4 1.1 8.7 
Net loss($99.5)($66.5)($216.6)($233.3)
Basic and diluted loss per share($0.80)($0.54)($1.74)($1.96)
Weighted average shares - basic and diluted (in thousands)124,439 123,597 124,273 118,917 
The accompanying notes are an integral part of the consolidated financial statements
5

Table of Contents
WOLFSPEED, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
 Three months endedNine months ended
(in millions of U.S. Dollars)March 26, 2023March 27, 2022March 26, 2023March 27, 2022
Net loss($99.5)($66.5)($216.6)($233.3)
Other comprehensive loss:
Net unrealized gain (loss) on available-for-sale securities5.5 (16.3)2.2 (20.7)
Comprehensive loss (94.0)(82.8)(214.4)(254.0)
The accompanying notes are an integral part of the consolidated financial statements
6

Table of Contents
WOLFSPEED, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
Common StockAdditional Paid-in CapitalAccumulated DeficitAccumulated Other Comprehensive IncomeTotal Shareholders' Equity
(in millions of U.S. Dollars, except share data in thousands)Number of SharesPar Value
Balance at June 26, 2022123,795 $0.2 $4,228.4 ($1,764.0)($25.3)$2,439.3 
Net loss— — — (26.2)— (26.2)
Unrealized loss on available-for-sale securities— — — — (7.0)(7.0)
Comprehensive loss(33.2)
Tax withholding on vested equity awards— — (16.9)— — (16.9)
Stock-based compensation— — 23.2 — — 23.2 
Exercise of stock options and issuance of shares415 — 0.5 — — 0.5 
Adoption of ASU 2020-06— — (333.0)29.7 — (303.3)
Balance at September 25, 2022124,210 $0.2 $3,902.2 ($1,760.5)($32.3)$2,109.6 
Net loss— — — (90.9)— (90.9)
Unrealized gain on available-for-sale securities— — — — 3.7 3.7 
Comprehensive loss(87.2)
Tax withholding on vested equity awards— — (0.4)— — (0.4)
Stock-based compensation— — 21.4 — — 21.4 
Exercise of stock options and issuance of shares203 — 10.7 — — 10.7 
Capped call transactions related to the issuance of convertible notes due December 1, 2029— — (273.9)— — (273.9)
Balance at December 25, 2022124,413 $0.2 $3,660.0 ($1,851.4)($28.6)$1,780.2 
Net loss— — — (99.5)— (99.5)
Unrealized gain on available-for-sale securities— — — — 5.5 5.5 
Comprehensive loss(94.0)
Tax withholding on vested equity awards— — (0.4)— — (0.4)
Stock-based compensation— — 20.8 — — 20.8 
Exercise of stock options and issuance of shares24 — 0.2 — — 0.2 
Balance at March 26, 2023124,437 $0.2 $3,680.6 ($1,950.9)($23.1)$1,706.8 
The accompanying notes are an integral part of the consolidated financial statements
7

Table of Contents
WOLFSPEED, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
Common StockAdditional Paid-in CapitalAccumulated DeficitAccumulated Other Comprehensive IncomeTotal Shareholders' Equity
(in millions of U.S. Dollars, except share data in thousands)Number of SharesPar Value
Balance at June 27, 2021115,691 $0.1 $3,676.8 ($1,563.1)$2.7 $2,116.5 
Net loss— — — (70.1)— (70.1)
Unrealized loss on available-for-sale securities— — — — (0.8)(0.8)
Comprehensive loss(70.9)
Tax withholding on vested equity awards— — (22.5)— — (22.5)
Stock-based compensation— — 15.6 — — 15.6 
Exercise of stock options and issuance of shares495 — 0.7 — — 0.7 
Balance at September 26, 2021116,186 $0.1 $3,670.6 ($1,633.2)$1.9 $2,039.4 
Net loss— — — (96.7)— (96.7)
Unrealized loss on available-for-sale securities— — — — (3.6)(3.6)
Comprehensive loss(100.3)
Tax withholding on vested equity awards— — (2.8)— — (2.8)
Stock-based compensation— — 15.7 — — 15.7 
Exercise of stock options and issuance of shares258 — 10.7 — — 10.7 
Issuance of shares related to the extinguishment of convertible notes due September 1, 20237,126 0.1 416.1 —  416.2 
Balance at December 26, 2021123,570 $0.2 $4,110.3 ($1,729.9)($1.7)$2,378.9 
Net loss— — — (66.5)— (66.5)
Unrealized loss on available-for-sale securities— — — — (16.3)(16.3)
Comprehensive loss(82.8)
Tax withholding on vested equity awards— — (0.8)— — (0.8)
Stock-based compensation— — 15.4 — — 15.4 
Exercise of stock options and issuance of shares29 — 0.3 — — 0.3 
Issuance of convertible notes due February 15, 2028— — 187.6 — — 187.6 
Capped call transactions related to the issuance of convertible notes due February 15, 2028— — (108.2)— — (108.2)
Balance at March 27, 2022123,599 $0.2 $4,204.6 ($1,796.4)($18.0)$2,390.4 
The accompanying notes are an integral part of the consolidated financial statements
8

Table of Contents
WOLFSPEED, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
 Nine months ended
(in millions of U.S. Dollars)March 26, 2023March 27, 2022
Operating activities:
Net loss($216.6)($233.3)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization118.2 97.9 
Amortization of debt issuance costs and discount, net of non-cash capitalized interest5.2 12.9 
Loss on extinguishment of debt 24.8 
Stock-based compensation62.8 45.2 
Loss on disposal or impairment of long-lived assets, including loss on disposal portion of factory optimization and start-up costs3.7 1.0 
Amortization of (premium) discount on investments, net(1.3)4.5 
Realized gain on sale of investments (0.3)
Deferred income taxes0.5 0.7 
Changes in operating assets and liabilities:
Accounts receivable, net(13.8)(26.5)
Inventories(59.3)(61.6)
Prepaid expenses and other assets(11.1)(3.3)
Accounts payable, trade4.1 11.3 
Accrued salaries and wages and other liabilities(7.6)6.5 
Accrued contract liabilities24.5 (3.2)
Cash used in operating activities(90.7)(123.4)
Investing activities:
Purchases of property and equipment(530.2)(535.5)
Purchases of patent and licensing rights(4.7)(4.2)
Proceeds from sale of property and equipment, including insurance proceeds1.7 2.7 
Purchases of short-term investments(1,020.5)(408.2)
Proceeds from maturities of short-term investments238.4 135.5 
Proceeds from sale of short-term investments81.8 223.2 
Reimbursement of property and equipment purchases from long-term incentive agreement131.0 83.5 
Proceeds from sale of business resulting from the receipt of transaction related note receivable101.8 125.0 
Cash used in investing activities(1,000.7)(378.0)
Financing activities:
Proceeds from long-term debt borrowings 20.0 
Payments on long-term debt borrowings, including finance lease obligations(0.4)(20.4)
Proceeds from issuance of common stock11.4 11.7 
Tax withholding on vested equity awards(17.7)(26.1)
Proceeds from convertible notes1,750.0 750.0 
Payments of debt issuance costs(31.4)(17.7)
Cash paid for capped call transactions(273.9)(108.2)
Commitment fees on long-term incentive agreement(1.0)(1.0)
Cash provided by financing activities1,437.0 608.3 
Effects of foreign exchange changes on cash and cash equivalents  
Net change in cash and cash equivalents345.6 106.9 
Cash and cash equivalents, beginning of period449.5 379.0 
Cash and cash equivalents, end of period$795.1 $485.9 
The accompanying notes are an integral part of the consolidated financial statements
9

Table of Contents
WOLFSPEED, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


10

Table of Contents
Note 1 – Basis of Presentation and New Accounting Standards
Overview
Wolfspeed, Inc. (the Company) is an innovator of wide bandgap semiconductors, focused on Silicon Carbide and gallium nitride (GaN) materials and devices for power and radio-frequency (RF) applications. The Company’s product families include Silicon Carbide and GaN materials, power devices and RF devices targeted for various applications such as electric vehicles, fast charging, 5G, renewable energy and storage, and aerospace and defense.
The Company’s materials products and power devices are used in electric vehicles, motor drives, power supplies, solar and transportation applications. The Company’s materials products and RF devices are used in military communications, radar, satellite and telecommunication applications.
The majority of the Company's products are manufactured at its production facilities located in North Carolina, California and Arkansas. The Company also uses contract manufacturers for certain products and aspects of product fabrication, assembly and packaging. Additionally, the Company recently opened its Silicon Carbide device fabrication facility in New York. The Company operates research and development facilities in North Carolina, California, Arkansas, Arizona and New York.
Wolfspeed, Inc. is a North Carolina corporation established in 1987, and its headquarters are in Durham, North Carolina.
Basis of Presentation
The consolidated financial statements presented herein have been prepared by the Company and have not been audited. In the opinion of management, all normal and recurring adjustments necessary to fairly state the consolidated financial position, results of operations, comprehensive loss, shareholders' equity and cash flows at March 26, 2023, and for all periods presented, have been made. All material intercompany accounts and transactions have been eliminated. The consolidated balance sheet at June 26, 2022 has been derived from the audited financial statements as of that date.
Certain prior period amounts in the accompanying consolidated financial statements and notes have been reclassified to conform to the current year presentation. These reclassifications had no effect on previously reported net loss or shareholders’ equity.
These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) for interim information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. These financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 26, 2022 (fiscal 2022) (the 2022 Form 10-K). The results of operations for the three and nine months ended March 26, 2023 are not necessarily indicative of the operating results that may be attained for the entire fiscal year ending June 25, 2023 (fiscal 2023).
Recently Adopted Accounting Pronouncements
Convertible Debt Instruments
In August 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40). This standard simplifies the accounting for convertible instruments by eliminating the cash conversion and the beneficial conversion accounting models. This update also amends the guidance for the derivatives scope exception for contracts in an entity’s own equity. The update requires an entity to use the if-converted method for all convertible instruments in the diluted earnings per share calculation. An entity may use either a modified or full retrospective approach for adoption.
The Company adopted this standard on June 27, 2022, the first day of its 2023 fiscal year, under the modified retrospective approach. The adoption resulted in (i) a reduction of additional paid in capital by $333.0 million for the recombination of the equity conversion component of the convertible notes outstanding, which was initially separated and recorded in equity, (ii) an increase in the cumulative convertible note carrying value of $277.9 million as a result of removing previously recorded debt discounts, (iii) a decrease in property, plant and equipment for previously capitalized non-cash interest of $25.4 million and (iv) a decrease to beginning accumulated deficit as of June 27, 2022 of $29.7 million to recognize the cumulative gain on adoption. The Company did not recognize a discrete tax impact related to the opening deferred tax balances as of June 27, 2022 due to a full U.S. valuation allowance.
11

Table of Contents
Government Assistance
In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832) - Disclosures by Business Entities about Government Assistance. This standard will require entities to provide annual disclosures regarding government assistance. More specifically, the amendments in the standard improve financial reporting by requiring disclosures that increase the transparency of transactions with a government accounted for by applying a grant or contribution accounting model by analogy, including (1) the types of transactions; (2) the accounting for those transactions; and (3) the effect of those transactions on an entity's financial statements. An entity can apply the amendments prospectively or retrospectively. The Company adopted this standard on June 27, 2022 and will apply the amendments prospectively. The required disclosures will be reflected in the Company’s Annual Report on Form 10-K for the fiscal year ending June 25, 2023.
Accounting Pronouncements Pending Adoption
None.

Note 2 – Discontinued Operations
On March 1, 2021, the Company completed the sale of certain assets and subsidiaries comprising its former LED Products segment to SMART Global Holdings, Inc. (SGH) and its wholly owned subsidiary CreeLED, Inc. (CreeLED and collectively with SGH, SMART) (the LED Business Divestiture) pursuant to the terms of the Asset Purchase Agreement (the LED Purchase Agreement), dated October 18, 2020, as amended. Pursuant to the LED Purchase Agreement, (i) the Company completed the sale to SMART of (a) certain equipment, inventory, intellectual property rights, contracts, and real estate comprising the Company’s former LED Products segment, (b) all of the issued and outstanding equity interests of Cree Huizhou Solid State Lighting Company Limited (Cree Huizhou), a limited liability company organized under the laws of the People’s Republic of China and an indirect wholly owned subsidiary of the Company, and (c) the Company’s ownership interest in Cree Venture LED Company Limited., the Company’s joint venture with San’an Optoelectronics Co., Ltd. (collectively, the LED Business); and (ii) SMART assumed certain liabilities related to the LED Business. The Company retained certain assets used in and pre-closing liabilities associated with the former LED Products segment.
The purchase price for the LED Business consisted of (i) a payment of $50 million in cash, subject to customary adjustments, (ii) an unsecured promissory note issued to the Company by SGH in the amount of $125 million (the Purchase Price Note), (iii) the potential to receive an earn-out payment between $2.5 million and $125 million based on the revenue and gross profit performance of the LED Business in the first four full fiscal quarters following the closing (the Earnout Period), also payable in the form of an unsecured promissory note (the Earnout Note), and (iv) the assumption of certain liabilities. The Purchase Price Note had a maturity date of August 15, 2023, and as explained further below, was prepaid by SGH in full pursuant to its terms, along with outstanding accrued and unpaid interest as of the payment date, in the third quarter of fiscal 2022. The Earnout Note was issued by CreeLED in the fourth quarter of 2022, had a maturity date of March 27, 2025 and as explained further below, was prepaid by CreeLED in full pursuant to its terms, in connection with the forgiveness by the Company of outstanding accrued and unpaid interest as of the payment date, in the first quarter of fiscal 2023. In fiscal 2021, the Company recognized a loss on sale of the LED Business of $29.1 million. The cost of selling the LED Business was $27.4 million, which was recognized throughout fiscal 2020 and 2021.
In connection with the closing of the LED Business Divestiture, the Company and CreeLED also entered into certain ancillary and related agreements, including (i) an Intellectual Property Assignment and License Agreement, which assigned to CreeLED certain intellectual property owned by the Company and its affiliates and licensed to CreeLED certain additional intellectual property owned by the Company, (ii) a Transition Services Agreement (LED TSA), (iii) a Wafer Supply and Fabrication Services Agreement (the Wafer Supply Agreement), pursuant to which the Company will supply CreeLED with certain Silicon Carbide materials and fabrication services for up to four years, and (iv) a Real Estate License Agreement (LED RELA), which will allow CreeLED to use certain premises owned by the Company to conduct the LED Business for a period of up to 24 months after closing.
In the third quarter of fiscal 2022, the Company received an early payment for the Purchase Price Note. The principal amount of $125.0 million was paid in full, along with outstanding accrued interest as of the payment date.
In the first quarter of fiscal 2023, the Company received an early payment for the Earnout Note. The principal amount of $101.8 million was paid in full and the Company agreed to forgo payment by CreeLED of the outstanding accrued interest as of the payment date.
12

Table of Contents
For the three and nine months ended March 26, 2023, the Company recognized $0.6 million and $2.4 million in administrative fees related to the LED RELA, respectively, none of which is included in accounts receivable, net in the consolidated balance sheet as of March 26, 2023. For the three and nine months ended March 27, 2022, the Company recognized $0.9 million and $2.7 million in administrative fees related to the LED RELA, respectively. Fees related to the LED RELA were recorded as lease income, see Note 4, "Leases."
For the three and nine months ended March 26, 2023, the Company recognized $1.5 million and $5.2 million in administrative fees related to the LED TSA, respectively, of which $0.5 million is included in accounts receivable, net in the consolidated balance sheet as of March 26, 2023. For the three and nine months ended March 27, 2022, the Company recognized $2.1 million and $7.4 million in administrative fees related to the LED TSA, respectively. Fees related to the LED TSA were recorded as a reduction in expense within the line item in the consolidated statements of operations in which costs were incurred.
At the inception of the Wafer Supply Agreement, the Company recorded a supply agreement liability of $31.0 million, none of which was outstanding as of March 26, 2023.
For the three and nine months ended March 26, 2023, the Company recognized a net loss of $4.8 million and $7.3 million, respectively, in non-operating income, net related to the Wafer Supply Agreement, of which a receivable of $2.0 million is included in other assets in the consolidated balance sheet as of March 26, 2023. For the three and nine months ended March 27, 2022, the Company recognized a net loss of $0.5 million and $1.4 million, respectively, in non-operating income, net related to the Wafer Supply Agreement.

Note 3 – Revenue Recognition
The Company follows a five-step approach for recognizing revenue, consisting of the following: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, the entity satisfies a performance obligation.
Contract liabilities primarily include various rights of return and customer deposits, as well as a reserve on the Company's "ship and debit" program. Contract liabilities were $72.3 million as of March 26, 2023 and $47.8 million as of June 26, 2022. The increase was primarily due to increased customer reserve deposits and ship and debit reserves. Contract liabilities are recorded within accrued contract liabilities and other long-term liabilities on the consolidated balance sheets.
For the three and nine months ended March 26, 2023, the Company did not recognize revenue that was included in contract liabilities as of June 26, 2022.
The Company conducts business in several geographic areas. Revenue is attributed to a particular geographic region based on the shipping address for the products. Disaggregated revenue from external customers by geographic area is as follows:
 Three months endedNine months ended
 March 26, 2023March 27, 2022March 26, 2023March 27, 2022
(in millions of U.S. Dollars)Revenue% of RevenueRevenue% of RevenueRevenue% of RevenueRevenue% of Revenue
Europe$73.2 32.0 %$63.2 33.6 %$212.5 31.0 %$183.0 35.3 %
China63.7 27.9 %50.4 26.8 %181.7 26.5 %143.0 27.6 %
Asia Pacific (excluding China)51.1 22.3 %30.7 16.3 %145.0 21.1 %88.6 17.1 %
United States39.8 17.4 %42.4 22.6 %143.5 20.9 %101.1 19.5 %
Other0.9 0.4 %1.3 0.7 %3.4 0.5 %2.0 0.4 %
Total$228.7 $188.0 $686.1 $517.7 

13

Table of Contents
Note 4 – Leases
The Company primarily leases manufacturing and office spaces. The Company also has a number of bulk gas leases. Lease agreements frequently include renewal provisions and require the Company to pay real estate taxes, insurance and maintenance costs. Variable costs include lease payments that were volume or usage-driven in accordance with the use of the underlying asset, as well as non-lease components incurred with respect to actual terms rather than contractually fixed amounts.
The Company's finance lease obligations primarily relate to contract manufacturing space in Malaysia and a 49-year ground lease on the Company's Silicon Carbide device fabrication facility in New York.
Balance Sheet
Lease assets and liabilities and the corresponding balance sheet classifications are as follows (in millions of U.S. Dollars):
Operating Leases:March 26, 2023June 26, 2022
Right-of-use asset (1)
$70.0 $48.5 
Current lease liability (2)
5.7 4.6 
Non-current lease liability (3)
72.9 43.6 
Total operating lease liabilities$78.6 $48.2 
Finance Leases:
Finance lease assets (4)
$9.8 $10.3 
Current portion of finance lease liabilities0.5 0.5 
Finance lease liabilities, less current portion9.3 9.6 
Total finance lease liabilities$9.8 $10.1 
(1) Within other assets on the consolidated balance sheets.
(2) Within other current liabilities on the consolidated balance sheets.
(3) Within other long-term liabilities on the consolidated balance sheets.
(4) Within property and equipment, net on the consolidated balance sheets.

Statement of Operations
Operating lease expense was $2.7 million and $7.4 million for the three and nine months ended March 26, 2023, respectively, and $1.8 million and $6.6 million for the three and nine months ended March 27, 2022, respectively.
Short-term lease expense, variable lease expense and sublease income were immaterial for the three and nine months ended March 26, 2023 and March 27, 2022.
Finance lease amortization was $0.2 million and $0.6 million and interest expense was $0.1 million and $0.2 million for the three and nine months ended March 26, 2023, respectively. Finance lease amortization was $0.2 million and $0.9 million and interest expense was less than $0.1 million and $0.2 million for the three and nine months ended March 27, 2022, respectively.
14

Table of Contents
Cash Flows
Cash flow information consisted of the following (1):
Nine months ended
(in millions of U.S. Dollars)March 26, 2023March 27, 2022
Cash (used in) provided by operating activities:
Cash paid for operating leases($4.7)($5.8)
Cash received from tenant improvement allowance on operating lease7.4  
Cash paid for interest portion of financing leases(0.2)(0.2)
Cash used in financing activities:
Cash paid for principal portion of finance leases(0.4)(0.4)
(1) See Note 5, "Financial Statement Details," for non-cash activities related to leases.
Lease Liability Maturities
Maturities of operating and finance lease liabilities as of March 26, 2023 were as follows (in millions of U.S. Dollars):
Fiscal Year EndingOperating LeasesFinance LeasesTotal
June 25, 2023 (remainder of fiscal 2023)$1.8 $0.3 $2.1 
June 30, 202410.3 0.7 11.0 
June 29, 202511.1 0.7 11.8 
June 28, 202610.8 0.7 11.5 
June 27, 20279.5 0.4 9.9 
Thereafter81.2 14.1 95.3 
Total lease payments124.7 16.9 141.6 
Future tenant improvement allowances(14.1) (14.1)
Imputed lease interest(32.0)(7.1)(39.1)
Total lease liabilities$78.6 $9.8 $88.4 
Supplemental Disclosures
Operating LeasesFinance Leases
Weighted average remaining lease term (in months) (1)
146470
Weighted average discount rate (2)
4.62 %2.69 %
(1) Weighted average remaining lease term of finance leases excluding the 49-year ground lease is 42 months.
(2) Weighted average discount rate of finance leases excluding the 49-year ground lease is 3.55%.
Lease Income
As mentioned in Note 2, "Discontinued Operations", on March 1, 2021 and in connection with the sale of its LED Business, the Company entered into the LED RELA pursuant to which the Company leased to CreeLED approximately 58,000 square feet of the Company’s property and certain facilities in Durham, North Carolina for a total of $3.6 million per year. The lease term was 24 months and expired on February 26, 2023.
The Company recognized lease income of $0.6 million and $2.4 million for the three and nine months ended March 26, 2023, respectively. The Company recognized lease income of $0.9 million and $2.7 million for the three and nine months ended March 27, 2022, respectively.
The Company did not recognize any variable lease income for the three and nine months ended March 26, 2023 and March 27, 2022.
15

Table of Contents
Note 5 – Financial Statement Details
Accounts Receivable, net
Accounts receivable, net consisted of the following:
(in millions of U.S. Dollars)March 26, 2023June 26, 2022
Billed trade receivables$161.0 $148.0 
Unbilled contract receivables2.8 2.7 
Royalties0.9 0.7 
164.7 151.4 
Allowance for bad debts(0.7)(1.2)
Accounts receivable, net$164.0 $150.2 
    
Changes in the Company’s allowance for bad debts were as follows:
(in millions of U.S. Dollars)March 26, 2023
Balance at beginning of period$1.2 
Current period provision change(0.5)
Write-offs, net of recoveries 
Balance at end of period$0.7 
Inventories
Inventories consisted of the following:
(in millions of U.S. Dollars)March 26, 2023June 26, 2022
Raw material$87.3 $60.2 
Work-in-progress172.9 135.9 
Finished goods28.7 30.9 
Inventories$288.9 $227.0 
Other Current Assets
Other current assets consisted of the following:
(in millions of U.S. Dollars)March 26, 2023June 26, 2022
Reimbursement receivable on long-term incentive agreement$86.9 $132.5 
Accrued interest receivable12.0 5.9 
Inventory related to Wafer Supply Agreement4.0 3.9 
VAT receivables3.3 0.2 
Receivable on Wafer Supply Agreement2.0 2.7 
Other receivables1.6 2.2 
Deferred product costs0.4 2.5 
Other1.8 1.5 
Other current assets$112.0 $151.4 
16

Table of Contents
Accounts Payable and Accrued Expenses
Accounts payable and accrued expenses consisted of the following:
(in millions of U.S. Dollars)March 26, 2023June 26, 2022
Accounts payable, trade$45.3 $57.8 
Accrued salaries and wages71.4 80.6 
Accrued property and equipment306.0 132.1 
Accrued expenses and other99.5 37.2 
Accounts payable and accrued expenses$522.2 $307.7 
Other Operating Expense
Other operating expense consisted of the following:
Three months endedNine months ended
(in millions of U.S. Dollars)March 26, 2023March 27, 2022March 26, 2023March 27, 2022
Factory start-up costs44.7 21.4 120.7 41.0 
Project, transformation and transaction costs3.9 1.2 11.4 5.3 
Factory optimization restructuring (1)
 0.8  5.5 
Severance costs0.5 0.5 2.0 0.5 
Other operating expense$49.1 $23.9 $134.1 $52.3 
(1) Factory optimization restructuring costs relate to the Company's multi-year factory optimization restructuring plan, which was implemented in connection with the Company's expansion activities between fiscal 2019 and fiscal 2022. As part of the factory optimization restructuring plan, the Company incurred restructuring charges associated with the movement of equipment as well as disposals on certain long-lived assets. The factory optimization restructuring plan concluded in fiscal 2022.
Accumulated Other Comprehensive Loss, net of taxes
Accumulated other comprehensive loss, net of taxes, consisted of $23.1 million and $25.3 million of net unrealized losses on available-for-sale securities as of March 26, 2023 and June 26, 2022, respectively. Amounts for both periods include a $2.4 million loss related to tax on unrealized loss on available-for-sale securities.
Reclassifications Out of Accumulated Other Comprehensive Loss
Reclassifications out of accumulated other comprehensive loss was a loss of less than $0.1 million for both the three and nine months ended March 26, 2023 and a less than $0.1 million gain and a $0.3 million gain for the three and nine months ended March 27, 2022, respectively. Amounts were reclassified to non-operating (income) expense, net on the consolidated statements of operations.
17

Table of Contents
Non-Operating (Income) Expense, net