Specialist
Former executive at On Semiconductor Corp
Agenda
- Wolfspeed (NYSE: WOLF) and operating overview of SiC (silicon carbide) Mosfets (metal-oxide semiconductor field-effect transistors) and GaN (gallium nitride], discussing supply-demand dynamics
- Wolfspeed's competitive positioning among alternate power device manufacturers
- CHIPS (Creating Helpful Incentives to Produce Semiconductors) Act's implications on Wolfspeed and desired outcome from new fab in Chatham County, North Carolina
- 2023 outlook
Questions
1.
How does SiC [silicon carbide] come into the highest-level implementations we see today? Can you discuss its robust growth, over 2022 especially?
2.
How have you seen the growing need for epitaxy solve some of these problems, especially in yield defects, and solidify the process of synthetically growing SiC?
3.
Could you highlight Wolfspeed’s unique offering in the alternative power space, highlighting its current operating environment?
4.
How do you predict competitive dynamics will look like in 2023 and onwards vs companies such as Infineon, Skyworks and Qorvo?
5.
How have the catalysts for the global chip shortage evolved and affected a company such as Wolfspeed? How do you see this changing over the next year or so?
6.
What was the historical turning point in SiC’s design in the pipeline – and Wolfspeed’s part in it – and the demand ramp-up overall?
7.
How is quantity and pricing negotiated with customers by Wolfspeed? Was there any sort of non-cancellable or non-returnable agreement?
8.
Wolfspeed is predicting a 10x increase in production in SiC at its Chatham Country, North Carolina raw materials factory. Do you think this is reasonable, and how do you think to the company will reach this target?
9.
What are Wolfspeed’s general plans regarding CAPEX? What will be the investment in new facilities, given that the incentives from the CHIPS [Creating Helpful Incentives to Produce Semiconductors] Act will cover the materials and cost of building as well?
10.
You noted building a new fab is very capital-intensive, yet it seems that the only thing people are really focusing on is the Advanced Manufacturing Tax Credit or building new capacity in the US. A factor overlooked is the importance of labour and education stemming from the R&D surrounding the fabs. Could you discuss that and how the CHIPS Act might spur growth in this sector?
11.
It’s safe to say that Wolfspeed’s recent Chatham plant in North Carolina is strategically positioned, given that states such as North Carolina are well-known for the micro-engineering and many doctorates within the semiconductor industry that come from there. Is there an existing relationship there, or do you think that’s a resource that the company can eventually turn to?
12.
How does Wolfspeed compare to competitors on the material side of SiC?
13.
Could you discuss Wolfspeed’s partnership with General Motors? How can this impact the auto industry and SiC’s penetration into it as a whole?
14.
Could you discuss Wolfspeed’s opportunities in non-auto? In its Q4 FY22 earnings call, CEO Gregg Lowe noted USD 100m of unfulfilled demand in non-auto.
15.
Could you discuss Wolfspeed’s positioning with its GaN [gallium nitride power] ICs [integrated circuits]. It’d be super helpful to get your comment on this.
16.
Can you speak to equipment lead times in fabs? What is your outlook for capacity and more efficiency?
17.
What is your outlook for Wolfspeed’s distribution chain into its various end markets as lead times recover? Which do you think will be the most successful when we see a recovery?
18.
Specialists in previous Interviews [see Onsemi – Automotive Penetration, New Developments & 2023 Outlook – 2 November 2022; Automotive Semiconductors – Q4 2022 Update & 2023 Outlook – 31 October 2022] have had differing opinions about the adoption of SiC into devices. It seems, at least for the next 5-10 years, silicon will still be the most dominant base material within auto chips. Do you agree with this outlook, and if not, why do you see SiC being adopted faster within the auto industry?
19.
What does Wolfspeed have to look out for regarding China-Taiwan tensions and export bans to China? Is the company really that impacted?
20.
You mentioned that adoption will eventually follow the driving of pricing down. What will primarily drive these prices down? Do you think it’s just more competition for a company such as Wolfspeed?
21.
As new players start to crowd the value chain, and there is potentially an oversupply of SiC, do you eventually see it being commoditised and have a more accepted price-to-yield ratio, though not a fixed one?
22.
What are the R&D implications for Wolfspeed? How fast do you think it’ll help, not only efficiency, but more developments in alternative wide-bandgap devices, as well as improving yield?
23.
How do you think Wolfspeed will combat fickleness in a turbulent macroeconomic environment, as many auto OEMs are known for cancelling orders and the company is heavily tied to industries such as automotives? There could be further delays along the chain.
24.
What is your 18-month outlook for Wolfspeed? What are you most excited for?
