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Technology Stocks : Wolf speed

WOLF 18.62

-7.9%

3:59 PM EST

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From: slacker711	3/1/2021 11:58:53 AM
	4 Recommendations Recommended By Lou Weed OldAIMGuy Sam The Ox of 10712

Some notes from Cree's Q&A at Morgan Stanley. Really happy that Cree appears to be webcasting more of their presentations. Maybe badgering IR worked :-). morganstanley.webcasts.com - Beginning of this transition. 7-10% increase in mileage with SiC (seen even higher). Supply 60%+ of world's SiC substrates. - Supplying substrates is strategic. Couldn't drive the transition to SiC on their own. Most materials sales are done through long-term agreements. Not much in the spot market. Customers are Infineon, ON, ST, and other companies that haven't been named. - Driving down the delta between SiC and silicon. Substantial cost reductions over the last 3-4 years. - Comparing transition to SiC to transition 40 years ago from Bipolar to CMOS transistors. Doesn't happen often in the industry. - Monthly review of progress of 200mm for last two years. Made decision to open factory at 200mm a few months ago. Ramping at 200mm saves customers a qualification cycle. Ramp of 200mm in 2022. Initial 200mm costs won't be there but they have line of sight to get it down by the 2024 timeframe. - New players in EV's have adopted SiC faster than traditional auto vendors. However, interest is high in SiC for new designs across the board. - Design opportunity pipeline more than $10 billion. Roughly half is automotive. Most is inverter but some is DC-DC charging. Quarter is industrial. - Current auto chipset shortage is driving more interest from vendors. - Played down the near-term results. 2021 and '22 are transition years. - Gross margins are dragged down by the "sub-scale fabs" in NC. "Hand to hand combat" with increasing yields but yields will remain "challenging" until Mohawk fab ramps. Very good success on costs on the material side of the business. Transition to Mohawk begins in 1st half of CY2022. - Starting production at 200mm in 2022. Internal and customer qualifications should be done sometime in 2022. Then ramping production.

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