Source: Content from Semiconductor Industry Observation

According to the latest news from Bloomberg, Microchip Technology Inc. CEO Ganesh Moorthy will step down after three years in office, and Chairman Steve Sanghi will return to the position.

Microchip said in a statement that Moorthy will celebrate his 65th birthday at the end of this month and retire on Monday. He has been with the company for 23 years and served as chief operating officer. Sanghi will continue to serve as chairman and immediately serve as interim CEO and president.

Microchip has fallen into a severe sales slump and is expected to see revenue plummet 40% this year. Sanghi is a company veteran who served as CEO before Moorthy took over in 2021 and vowed to help the company get back on track.

"I look forward to serving as CEO and president again, leading Microchip through this industry downturn, restoring the company to revenue and earnings growth, and increasing shareholder value," he said in the statement.

The company, which makes chips for cars, consumer devices and other products, is one of the worst performers in the Philadelphia Stock Exchange Semiconductor Index this year. In 2024, the company's stock price fell 28%.

The Chandler, Arizona-based chipmaker also suffered a cyberattack earlier this year that slowed its operations. At the same time, the company is expected to receive funding from the 2022 American Chips and Science Act, which aims to support the domestic chip industry.

Meanwhile, Microchip, another major US chip manufacturer, also lost its CEO on the same day.

Wolfspeed fires CEO after stock price plummets

Durham-based semiconductor chipmaker Wolfspeed will replace its CEO and president, Gregg Lowe, the company's board announced Monday, ending a seven-year tenure that has seen Wolfspeed transition, expand and, more recently, struggle in key technology areas.

"The board has always been committed to driving long-term value," Wolfspeed Chairman Thomas Werner said in a statement. "At this inflection point in Wolfspeed's story, the board unanimously agreed that this is the right time for a leadership transition."

Lowe will leave the company this month. He was one of the highest-paid executives in the Triangle, with total compensation of $11.4 million this year and $12.47 million in 2023, according to company financial filings. Werner will serve as executive chairman until a new CEO is found.

Shares of Wolfspeed rose 6% Monday morning on news of the leadership change.

Lowe was named CEO in 2017 when Wolfspeed was operating under its original name, Cree. He oversaw the company's shift from making LED lights to specializing in a unique semiconductor material called silicon carbide. The material is more efficient than traditional silicon and can be cut into chips to power devices such as electric vehicles, defense equipment and energy storage devices. In the past five years, Wolfspeed has sold its non-silicon carbide units and worked to build large silicon carbide factories in New York and North Carolina.

The company's press release said the board "agreed" to Lowe's departure and included a statement from Lowe.

"Over the past seven years, we have built Wolfspeed into the only pure-play vertically integrated silicon carbide operator in the country to capitalize on the structural and secular demand for next-generation semiconductor technologies," Lowe said in a statement Monday. "While there is still work to do, I have every confidence that Wolfspeed will execute on its strategic priorities and expand its silicon carbide leadership in the years ahead."

Analysts say Wolfspeed has made mistakes in its transition to silicon carbide, including multiple missed production deadlines, which have frustrated investors. The company's stock has plummeted over the past two years, from more than $100 per share to less than $10. As Wolfspeed's stock price has fallen, prominent activist investor Jana Partners has increased its stake.

During a recent earnings call, Lowe noted that the company has been hit by weak demand for electric vehicles.

This summer, Wolfspeed announced it would close an equipment plant at its main campus near Research Triangle Park due to liquidity issues. Starting in August, the chipmaker began reducing its 5,000-person global workforce by 20% through attrition, voluntary buyouts and layoffs. The company said most of those cuts affected employees in North Carolina.

Wolfspeed has also had success over the past 12 months. In March, the company completed construction on a multibillion-dollar materials plant near Siler City. Last month, the company signed a nonbinding agreement to receive a $750 million grant through the federal CHIPS and Science Act.

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