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As we near the end of the year, two CEOs at prominent semiconductor firms are leaving, and in both cases, the chairmen of the board are replacing them as interim CEOs. What’s common in both companies is the quest for a turnaround in the rapidly evolving semiconductor market.
First, Ganesh Moorthy, president and CEO, is leaving Microchip, and chairman Steve Sanghi is taking back the charge of the top job at the Chandler, Arizona-based semiconductor firm. While the announcement states that Moorthy is retiring after his nearly three-year stint at the corner office, the fact that Sanghi is back at the helm immediately doesn’t exactly signal a smooth transition.
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Figure 1 Before joining Microchip, Moorthy was CEO of Cybercilium, the company he co-founded in Tempe, Arizona.
Sanghi, who will remain chairman, is taking charge as interim president and CEO. Moorthy joined Microchip as VP of advanced microcontrollers and automotive division in 2001, and he was appointed chief operating officer before being elevated to the CEO job in 2021. He had served at Intel for 19 years before his stints at Cybercilium and Microchip.
Microchip has been confronting an inventory stock and sales slump for some time, and its shares are down 28% in 2024. Sanghi’s statement on taking the charge as CEO clearly points toward an aim to return to growth in revenue and profitability.
Then there is the news about Wolfspeed’s CEO change, and it’s more startling and less subtle. The Wolfspeed board has ousted CEO Gregg Lowe without cause, and like Microchip, chairman of the board Thomas Werner is taking over as interim CEO before Wolfspeed finds Lowe’s replacement.
Lowe, who spearheaded Freescale’s sale to NXP in 2015 as CEO, took the helm of Cree in 2017 and transformed it from an LED lighting company to a silicon carbide (SiC) IDM. During this transformation under Lowe, the company acquired a new name: Wolfspeed. Also, during this time, Infineon made a failed attempt to acquire Wolfspeed.
However, the Durham, North Carolina-based chipmaker seems to have failed to translate its enviable position as a pure-play SiC company in this high-growth market, and that probably sums up Lowe’s ouster. It’s apparent from Werner’s statement announcing this CEO transition. “Wolfspeed is materially undervalued relative to its strategic value, and I will focus on driving the company’s priorities to explore options to unlock value.”
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Figure 2 Lowe sold off Cree’s LED lighting business and turned the sole focus on SiC under the Wolfspeed brand.
For a start, Wolfspeed has been struggling in the transition from 150-mm to 200-mm SiC wafers. It has also been facing slowing orders from the electric vehicle (EV), industrial and renewable energy markets. The company recently dropped plans to build a SiC fab in Ensdrof, Germany.
These two CEO office transitions don’t come as a surprise to the semiconductor industry watchers. And it surely won’t be the last as we are about to enter 2025. The semiconductor industry is highly competitive, and stakes are even higher when you are a vertically-integrated chip outfit.
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