Wolfspeed’s dual trajectory: power SiC and strategic divestiture

Wolfspeed has charted a distinctive course in the GaN and SiC technology landscape. Their prowess in power SiC technology became evident through its remarkable success in sectors like automotive and industrial applications. The technology’s integration into diverse applications cemented Wolfspeed’s reputation as a leader.

The company faced challenges within its RF-related ventures due to a sluggish telecom market, geopolitical complexities, and the COVID-19 pandemic. Responding to these challenges, Wolfspeed strategically chose to divest its RF business, reallocating its resources into the flourishing Power SiC division.

Today, Yole Intelligence’s experts, Aymen Ghorbel and Poshun Chiu, deliver their analysis of Wolfspeed’s market positioning and strategy in the RF domain.

This analysis is extracted from the following products: RF GaN report and RF GaN Compound Semiconductor Market Monitor. Yole Intelligence is a Yole Group company. Discover today a snapshot of Wolfspeed’s RF activities.

The accuracy of Yole Intelligence’s RF GaN report for 2023 is striking, as it accurately foresaw Wolfspeed’s decision to divest its RF business. Originally acquired from Infineon Technologies for $345 million, the decision to sell it for $125 million reflects Wolfspeed’s strategic repositioning and prioritization of SiC power technologies. Having preserved its essential SiC wafer and GaN-on-SiC epiwafer businesses, Wolfspeed’s potential for expansion becomes even more promising, particularly considering its decision to cease supplying competitors following the sale of its device business.

However, the price of the acquisition is quite low compared to the current financial valuation of semiconductor companies: paying $125 million for a $212 million business in 2022 at the device level is quite low compared to the latest M&As in the semiconductor arena. Not all the details of the deal are available, of course, but it raises questions.

Aymen Ghorbel Technology & Market Analyst, Compound Semiconductor & Emerging Materials, Yole Intelligence
Wolfspeed is now a company focusing almost entirely on power devices, from wafers, epiwafers, and devices to modules. Indeed, Wolfspeed is the only pure player with a significant size in the power SiC industry. It will certainly pave the way for strong development in the coming quarters and years…

MACOM reshaping the future of RF GaN-on-SiC and GaN-on-Si

In the ever-evolving landscape of GaN technology, two industry giants, MACOM and Wolfspeed, have emerged as key players. Both are reshaping the trajectories of RF and SiC technologies. Each company’s strategic moves and innovative approaches have positioned them at the forefront of these rapidly advancing sectors over the last decade.

MACOM’s pioneering exploration of GaN-on-Si technology began early, despite initial challenges in achieving significant market penetration. Their early engagement laid the foundation for subsequent breakthroughs.

Since 2018, MACOM has been strategically aligned with STMicroelectronics, leveraging their joint recognition of the potential of GaN-on-Si technology. In a significant development announced in 2022 (Previous announcement in 2019), they proudly showcased the successful production of RF GaN-on-Si prototypes on 6-inch wafers. This milestone aligns with their overarching objective of introducing GaN-on-Si technology to the market, focusing on applications that span the telecom and consumer sectors.

In a significant achievement, MACOM reached a notable milestone by acquiring French OMMIC SAS at the beginning of 2023. This strategic move distinctly highlighted MACOM’s dedication to mmWave technology and its broader growth strategy. Notably, OMMIC’s expertise in GaN on Si technology is set to enhance MACOM’s portfolio, extending its capabilities to cater to the defense and aerospace sectors in both the US and Europe.

Meanwhile, in response to the robust demand from the defense sector, MACOM, a trusted defense partner, strategically shifted its focus towards GaN on SiC technology at the beginning of the 2020s. This pivotal move enabled the company to address the specific requirements of defense applications by specializing in high-power devices reaching up to 7kW.

Partnering closely with the US defense sector, MACOM’s collaboration with the Air Force Research Laboratory (AFRL) has led to remarkable technological progress on GaN on SiC. A noteworthy milestone within this collaboration is the recent transfer of the 0.14µm technology node, enabling operations at high frequencies in the K to Ka-band. This technology holds the promise of ushering in significant progress in military communication.

MACOM’s strategic acquisition of Wolfspeed’s RF business marks a pivotal moment, enhancing its capability to address established sectors like defense and aerospace while strengthening its foothold in the telecom market. By leveraging Wolfspeed’s substantial standing in the RF GaN market, MACOM further bolsters its presence and strategic positioning. This move underscores MACOM’s commitment to expanding its share in the RF GaN market and harnessing the strengths of its new assets, with a complete portfolio of both GaN-on-Si and GaN-on-SiC technologies addressing a wide frequency range.

What will come next? Should we expect other M&As? What will be the impact on the RF GaN industry?… Yole Group and its analysts invite you to follow this industry with dedicated products, articles, interviews, and events.

Stay tuned on!

About the authors

Aymen Ghorbel is a Technology and Market analyst at Yole Intelligence, part of the Yole Group, specializing in Compound Semiconductor and Emerging Materials. As a part of the Power & Wireless division, Aymen is engaged in the development of technology and market reports and is also involved in custom projects.

Aymen previously worked as an Electrical Characterization Engineer and an Innovative Product Development engineer at Soitec. He co-authored five papers in high-impact scientific journals and two patents.

Aymen obtained an engineering degree in Material Sciences in 2016 from École Polytech‘ Grenoble  (France) and an M.S. in “Technology and Innovation Management” in 2017 from Grenoble Ecole de Management (France).

This article has been developed in collaboration with Poshun Chiu, Senior Analyst, in Compound Semiconductor and Emerging Substrates activities within the Power and Wireless Division at Yole Intelligence, part of Yole Group.

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