NEW YORK — Wolfspeed Inc. shares rocketed more than 23% in early trading Wednesday, climbing to $66.35 as a bullish research note spotlighting the silicon carbide specialist as a prime AI infrastructure play triggered heavy buying and accelerated a short squeeze in the heavily shorted name.

The North Carolina-based company, a leader in silicon carbide semiconductors critical for electric vehicles, renewable energy and high-power AI data center applications, has been on a tear since emerging from Chapter 11 bankruptcy last fall with a dramatically cleaned-up balance sheet. Wednesday’s surge extended a seven-session winning streak and pushed the stock to fresh post-restructuring highs.

Analysts at Citrini Research published a note late Tuesday positioning Wolfspeed as one of the clearest “laggard catch-up” opportunities in the semiconductor sector. The report highlighted the company’s fully U.S.-based supply chain, restructured factories optimized for high-efficiency power semiconductors, and accelerating revenue from AI-related demand as key differentiators.

Silicon carbide chips excel at handling high voltages and temperatures with greater efficiency than traditional silicon, making them essential for power-hungry AI servers, data center infrastructure and next-generation EVs. Wolfspeed’s technology addresses exactly the bottlenecks facing hyperscalers racing to deploy massive GPU clusters.

Short interest has remained elevated, with recent data showing more than 57% of the float sold short in some measurements, creating fertile ground for a squeeze. As the stock climbed on the Citrini catalyst, forced covering amplified the move, with volume spiking dramatically in pre-market and early sessions.

The rally builds on positive momentum from Wolfspeed’s fiscal third-quarter results released May 5. Although the company reported a revenue miss and continued negative gross margins due to factory underutilization, investors focused on forward-looking signals: AI sales up 30%, debt reduction progress, cash reserves near $1.2 billion and strategic refinancing that slashed interest expenses.

Post-bankruptcy leadership changes have also boosted confidence. CEO Robert Feurle and a refreshed executive team have emphasized operational execution, capacity expansion and monetizing tax credits. The company recently received nearly $700 million in IRS refunds under advanced manufacturing investment credits, further strengthening liquidity.

Wolfspeed’s long-term thesis centers on the structural shift toward wide-bandgap semiconductors. Global demand for silicon carbide is projected to grow rapidly as AI energy consumption soars and electrification accelerates. The company’s Mohawk Valley and other U.S. fabs position it to capture domestic content advantages amid supply chain security concerns.

Challenges remain significant. Wolfspeed continues operating with negative margins amid ramp-up costs and underutilized capacity. Competition in the silicon carbide space is intensifying from larger players, and execution on production scaling will determine whether the current enthusiasm translates into sustainable profitability.

Analysts maintain a range of views. Some see substantial upside if AI tailwinds materialize and margins improve, while others caution about volatility and the stock’s history of dramatic swings. Price targets vary widely, reflecting the high-risk, high-reward nature of the restructured entity.

The broader semiconductor sector has shown selective strength amid AI optimism, but Wolfspeed’s move stands out for its magnitude. Year-to-date, the stock has rebounded dramatically from post-bankruptcy lows, though it remains well below pre-restructuring levels when factoring in massive dilution for legacy shareholders.

Technical traders noted the breakout above recent resistance with expanding volume. Support levels sit near $50-$53 from prior closes, while momentum indicators suggest potential for further upside if buying persists. However, profit-taking or short covering exhaustion could lead to sharp pullbacks given the stock’s volatility.

For investors, Wolfspeed represents a speculative bet on the intersection of AI power demands and domestic semiconductor manufacturing. The company’s ability to convert hype into consistent revenue growth and positive margins will be tested in coming quarters. Upcoming capacity milestones and potential new customer wins could sustain momentum.

Market watchers will closely monitor whether today’s surge holds through the session or fades as a classic short-squeeze event. With high short interest and fresh AI narrative fuel, Wolfspeed remains one of the more volatile names in the semiconductor space heading into the second half of 2026.