Navitas shares drop as Wolfspeed sues over patents

Navitas Semiconductor shares tumbled about 8–9% in pre-market trading after Wolfspeed filed a patent-infringement complaint on Tuesday in the U.S. District Court for the District of Delaware. The complaint alleges Navitas’s gallium nitride (GaN) and silicon carbide (SiC) power-chip products infringe five U.S. patents.

Wolfspeed identified a broad range of Navitas products in the filing, including GaN-based FETs from the GaNFast, GaNSlim and GaNSafe families, GeneSiC MOSFETs and SiCPAK modules. The company named five U.S. patents and described its intent to protect intellectual property developed over decades of research and investment.

Navitas was trading around $13.99 pre-market, down roughly 8.2%, with some quotes showing a decline above 9%. The stock had gained about 370% over the prior year and was trading at roughly 137 times projected sales for the next 12 months before the filing.

Analysts had increased their targets on Navitas earlier this year. Needham analyst N. Quinn Bolton raised his price target to $21 from $13 and kept a Buy rating after the company reported results and guidance above expectations. Baird analyst Tristan Gerra maintained a Buy rating and raised his target to $20 from $4 in May.

The complaint will move through the federal court system in Delaware, where the parties can pursue discovery, file motions and potentially go to trial. The filing may lead to claims for damages, requests for licensing fees or injunctions; there is no court ruling at this stage.

Wolfspeed Chief Executive Robert Feurle described the company as “deeply committed” to defending its intellectual property and to protecting investments made by shareholders.