All right. Thanks, thanks everyone for being patient as we got all mic'd up here. This next session is gonna be pretty interesting. We're gonna be talking about a clean tech area that may be not as front and center for a lot of you folks and has become kind of a key theme within the electric vehicle and charging as well as solar space just in the recent past. You know, we have the pleasure of hosting really the industry pioneers and leaders in the space, Wolfspeed. I almost called you guys Cree. We have Elif Balkas, Vice President of Research and Development in the materials segment, as well as to her left, Head of Investor Relations, Tyler Grych, joining us on the stage.
Really we're just gonna have a pretty open-ended discussion around silicon carbide technology, what Wolfspeed is doing, and sort of, you know, one of the de facto sort of trends sla-slash ways that we think could be an opportunity to leverage into the EV ecosystem and theme. Thank you both for joining us. Elif, I've never had the pleasure of hosting you at one of these conferences. Clearly, you know, clean tech is becoming a key part of the Wolf end market opportunity.
I just wanted to kind a talk to, the evolution you've seen in the company, you've been there for quite a while, as well as the industry as you've kind of shifted to become a more de facto materials and device leader, in the EV supply chain, amongst others in the clean tech space.
Thank you, Brian. Thank you. It's first time for me to attend this conference. I'm really excited to talking to you, and it's great opportunity for me as well. I'm coming from a very much the technology background pretty much all of my life that I work with the wide bandgap materials, gallium nitride and silicon carbide. I've been with Wolfspeed for a little over 15 years now, working primarily on the silicon carbide technologies all the way coming from the crystal growth side of things, and then having the substrates ready for the, with the good epitaxy and the device applications.
During the time that I've been at Wolfspeed, and at the time Cree, we've worked very heavy on the material side of things as the silicon carbide technologies has been the core for us. Also that the working with the different applications that started with this amazing material that what can give us in terms of the applications that we work with the LEDs and then the power electronics and the RF electronics. The evolution of things that then of course it is all like has different challenges when you look at it from the silicon carbide substrates and the crystals. It's been an amazing journey for us that the building on our 30-plus years of technology and then the maturation.
Then more so within the last, I would say 5 to 10 years, as we demonstrate the technologies with the MOSFETs and the power electronics and the movement in the market and electrification of things is very exciting for us.
Great. Maybe we'll start off by talking about that amazing material you mentioned.
SiC, silicon carbide, I'll probably use it pretty synonymously throughout the conversation. Why is SiC better than silicon? Why is Wolf the leader in that space?
Yeah. That's a, that's a question we study a lot.
Silicon carbide is a fascinating material. The differentiation at the materials level I think is coming from the intrinsic property of the how large is the bandgap. When we talk about the solid state physics that basically what actually manages and drives the electrons' movement in the material. You can with that material you can create really strong power switches, and then those devices, it opens up so many opportunities. Compared to silicon that a couple of EV of the larger bandgap, it gives you opportunity for higher voltage, higher power densities, much larger efficiencies compared to silicon.
At the same time, silicon carbide is so unique when you look at the similar material systems, you see sometimes the good electrical properties, but the others are not as good. In the silicon carbide, you see all properties specific to the power electronics that you see really good electrical performance, but really good thermal performance. When you think about it in the system level that you get a much larger power density, but you also have a great heat dissipation. You can run the devices at a higher temperature, and then you have the ability to remove the heat much efficiently. You don't, at the system level, you don't need too much of the supporting circuits to manage the whole thing. It creates a great opportunity actually for us.
Sure. I mean, it might not be a simple answer.
Wolf's leadership, Tyler, you look like you wanna jump in here a little bit too. Why has it been the case that you've established such a big lead versus the rest of the industry when we look at, you know, your capacity growth, your revenue targets? Clearly you're much more ahead of peers. What's put you in that position?
I say few things and then
Yeah, sure.
maybe you can jump in, Tyler. When we look at the history of the company, our founders, some of them are still very active, that they are, they have the material science background, and they studied silicon carbide and saw that this is like amazing material that the potential.
Yeah.
We came from that end of it, that it helped us also like the building the very strong technology foundation. If you think about this was 35 years ago, we have like we stay as a very like the core technology company that when you look at our talent base, that we're very hungry and excited about it, the opportunities can be created with the material itself. Over the years that of course that we were the first ones to demonstrate and penetrated the market for the light-emitting diodes. After that, showing the potential with the Schottky diodes, but also the release of the MOSFET, it's actually showing the whole industry that what can be achieved.
Of course, in parallel on the RF side of things with the GaN on silicon carbide, and then the potential there in terms of the wireless and the radar applications, that it's just all in all that we're very rich in terms of the technology background, and so we kind a like the building it over the history as well. To me that for us to take the lead, there's no other, you know, the option for me.
Now that we show the potential and then when we match it with the market readiness and the demand readiness, then it's only the, you know, the putting the right pieces together with our manufacturing excellence, with our, you know, the marketing teams, and then with our, you know, the applications teams and working with our customers. It's inevitable, I see this. What do you think, Tyler?
Well, I wanted to give a shout-out to Brian...
and the rest of the research team. If you haven't had a chance to digest some of the work that they've done on silicon carbide, it's very impressive. We agree with a lot of your assumptions. Just think of it this way. The Goldman team concluded for every dollar of silicon carbide that goes into the electric vehicle, there's a three and a half to $7 savings in the overall design. Wiring harnesses get smaller. You need less cooling, okay? You factor that in that with a silicon carbide-based solution, your range is gonna increase anywhere from 5 to 10%. Your charging time is gonna be less.
What you heard Elif talking about, what Brian is talking about is we're seeing automotive players say, "Hey, listen, range and charge time are the two things that a consumer really thinks about before they purchase an electric vehicle." This is where silicon carbide has made some incredible inroads. If you like EVs and you're looking for a de-risking strategy, silicon carbide is a really strong way to play.
The technology sounds great, but it also what we've heard consistently is it's pretty difficult and hence why you probably have the lead you do. I guess, what makes the technology so tough? We get this question all the time. Why can't others, especially if you look at the activity levels in Asia, a lot of folks would like to
enter into this market because it's such a big TAM and EVs are, you know-
a huge growth opportunity. Is there a way to think about how Wolfspeed is ahead of everyone, whether it's yield, it's performance, just sort of a quantifiable measure or some sort of, a performance metric that gives you confidence that you are consistently gonna be in the lead there?
When it comes to performance metrics that internally we have a lot, Brian. I think for the external world our method of delivery and the consistency is the biggest, I would say, metric that we have a, I think that we have a pretty good reputation there in the market. When we talk about the difficulty of silicon carbide, We talk about it's fascinating material, but it's also that, it's a hard material. It's also very brittle, and then That hardness, it makes it very difficult to process. When we take a step back, the silicon carbide material itself that for the power electronics and the electronics in general, that we wanna make it very pure. Pure of all the other elements.
We wanna have a single, pure silicon and carbon, then combine it into a single crystal so we can build devices on them. We need a certain crystalline structure, silicon carbide is very fascinating, I call it, because it gives you the more than 200 possibilities. The method to grow crystals of silicon carbide, you take your pure sources and you put it in a what we call crucible, then you heat it up to transport the source to the seed. That transport mechanism doesn't begin until you heat the whole system up to about 2,000 degrees.
If you take in, you know, the regular person that just to understand, comprehend what it means, that it's. I always give the example that it's actually halfway to the temperature of the surface of the sun. That's a very high temperature. It's bright white at that temperature. You can't even look at it. If you think about for a minute that what it takes to what type of system does it take? Where do you put that much of, you know, the heat? Also, how do you control? When you measure, how do you control the? Do you have the right temperature? Do you have the right pressure? Did everything go well? That's very challenging. It puts a lot of, like, challenges to the infrastructure itself.
it's actually that we also call it, like it's pretty much a black box because you can't open a port to look inside. You put everything to your best, and then you hope for the literally for the best. we've done this for 30-plus years, and of course at every time, we collect a lot of data, we learn a little bit, and then we, you know, document that data. since we're in the actually the energy conference that I'll use an analogy that, you know, in the data science field which we study a lot, that the data is oil. it's our actually the energy that we rely on, that our past experience, that what we learned, that accumulated data.
We rely on a lot of the data science to kind of like to dial everything together. That 30 years, 30-plus years of commercial, you know, the accumulation, that it gives us a pretty good confidence.
Yeah.
I will say that it's very challenging and things go wrong. That's coming from the, number one, the temperature. Number two is the how sensitive the material. It gives you like 200 different possibilities even though you put everything, you know, pretty, you know, close to perfect. You can manage it. I mean, we can manage it through our, you know, accumulated knowledge and the database and the talent base. It becomes our, you know, that turns into our advantage. That is our strength.
Thank you.
Sure.
Brian, if I could just add on to what Elif was talking about, I think what's good for everyone to also know is that we make 60% of the world's supply of silicon carbide today. The next 2 closest competitors is Coherent at about 15% of the market, and then the next closest competitor is about ROHM at around 10%. So you've got 3 people or 3 entities that are making about 85% of the world's supply, and then everybody else is kind of low to mid.
That's right.
single digits. We fundamentally believe that over time, more people are gonna gain or more companies are gonna gain an ability to make material, but it's gonna be more evolutionary versus revolutionary. We think about a moat, you know, that gives us a competitive advantage on materials, but at the same time, we're penetrating more of the device market. We supply materials to device manufacturers at the same time that we're competing with them for sockets, you know, for wins. Like I said, I think it's very difficult to do. We're very good at what we do, but we also are paying very close attention to what competitors are doing.
I'm glad you brought that up, and it's a good segue into a discussion around kind of the competitive landscape. Just to level set everyone, you're the leader in the material space, but those materials, you're vertically integrated. You're also producing devices/you know, chips that basically are going into the electric vehicles, the Jaguar Land Rover, the Mercedes-Benz of the world. You've got a peer group, which you mentioned a couple of them in the material space. My question to you on that would be, beyond the incumbents, what's your view on kind of new entrants? Again, I mentioned there's a lot of activity happening in China in particular. We'd love to you know, hear your view on that.
Who are your peers on the other side of the house? you know, some of them are your customers as well, as you mentioned, but the chip guys, who are your peers there? Kind of to round up the conversation, do you see, in the future business models like yourselves emerging, where they're vertically integrated companies doing both the upstream as well as the chip side, and so it looks very much like a Wolf model? you know, why or why not? Why wouldn't that be the case?
Right. Right. Yeah.
You wanna start and then
You go ahead, and I'll talk about the competitive side of things actually. That.
Yeah. I'd say this. I think, you know, to frame the market, then I'll let Elif talk more about the competitive landscape. You know, we work, we have strong relationships with STMicroelectronics and Infineon Technologies and onsemi on the wafer side or on the material side of the business. Then we are also competing with them on the device side. You might say to yourself, "Why do that?" I go back to Brian's first question to Elif about we're making a market for silicon carbide, and we're still very early stage. Electric vehicles are really driving the lion's share of penetration over the next decade, but industrial and energy and things like solar are gonna benefit from all that.
That's where we feel today it's important for us to make an ample supply of wafers for, you know, other device players at the same time that we're building a, you know, a strong portfolio of devices. Maybe you wanna talk a little bit more about the competitive landscape.
Competitive side of things and yes. Thank you, actually, Tyler, to add to that. That's actually that, coming from our foundation and the how we try to transition the industry from silicon also to silicon carbide. One of the things that we've done always is not new, that supporting our peers in the device level with our materials, with the idea of like expanding the market for silicon carbide. When you look at it a little bit even higher levels, not even silicon to silicon carbide, that in terms of the how limited we are with the renewable energy and then also the sustainability and then the environmental reasons that the electrification of things is important.
With that, at Wolfspeed that we're more about the supporting, the serving to the market. I think that we have a really good relationship with our customers. We have our full commitments to protecting their processes and their needs from us, and then keeping a good firewall in terms of our vertical integration. Creating that market, of course, it helps us. It, it actually touches us in terms of the environmental and the sustainability reasons. As the market that we see that there's so much potential that is normal to expect the competitors, we're not surprised with that. We actually that when we talk about in the technical threshold and the conferences that with our peers that we say that we're in this all together.
We wanna see silicon carbide successful, and then there's plenty of room, and actually we will be very much like catch up game for the next decade or maybe two. We expect, of course, the competitors in the field to get stronger. Our motivation on our side is keep pushing on what we build in terms of the technology foundation, look for the better ways to serve our customers in the field, get, you know, to increase our, you know, the amp per, at the end of the dollars, and then the quality and the reliability of our devices. At the same time, of course, that to maintain our edge in terms of the competitive edge. Brian, you also asked about China as well.
Of course that we monitor, and then we see the movements there too. There are a couple of the companies in the silicon carbide field that we see good material, but then coming from it's between the 100mm diameter to more so recently to 150mm. As a technologist, the way I see it is more of a time catch, and then because as you see and as we talk about more in the public that we are more into the ramping the 200mm and all that with the quality and better quality and better yields. I think the summary is that there will be competition, is expected, it's normal. There will be room for, like, a lot.
Yeah.
For us it how well we serve the market and with our competitive and technology edge.
Maybe one last question on technology.
I'll shift gears to another topic.
Sure
you know, since we're on the topic of technology, you know, China does sound like they're a step behind. The wafer sizes are behind. We hear yields are low. You are hearing about certain innovations like wafer slicing.
Sure
you know, Soitec out in Europe. There's one of your peers/customers, onsemi, which is doing something after an acquisition of some GT Advanced, which is growing crystal. Are there innovative silicon carbide technologies that kind a keep you up at night or view, you know, view as more of a competitive threat?
Which ones would you be more focused on?
Right. Yes. As I mentioned that as Wolfspeed, we're very heavy on the technology. When we look at our talent base that they actually, they love the technology, thrive on it. I mentioned that we're very hungry, it's a lifelong dedication, now we see that it's okay. We're at the edge, it's happening, we can convertible the market and serve to that market actually. That same culture comes with a lot of paranoia as well, that when you say, Brian, that there are a lot of things keeping me, you know, awake, like with at night.
Within our body of research and development, we try a lot of the things just to relate to what's happening externally, and then we test and have a good understanding of, you know, what's happening in the field. I personally, as a part of my job that I go and explore and then study those. With the examples that you're mentioning about the slicing, or I see that it's all about getting to the. Yes, the number one is performance, but then performance, the scale and the economies of things, it's all about that. How do we bring the cost, overall cost, the bill of materials at the end of the day down, and then all the technology influences to that. I see it that way.
At the end of the day, all those technologies should yield to well-performing devices and reliable devices. Yeah.
Fair enough. Let's shift gears a bit to, you know, the scale-up that's happening at Wolf. There's, you know, clearly a lot going on. You've got the large, you know, wafer facility up in upstate New York, Mohawk Valley, and then recently you announced a new materials plant in Siler City in North Carolina. Maybe, you know, starting with Mohawk, what's the latest on the ramp-up there? Are you know, into customer quals? What's the expectation for calendar 2023? If we think about milestones moving through the year, sort of, you know, H1, midyear, H2, what should we be expecting in terms of updates out of Mohawk?
You wanna.
I'll take that.
Yeah, please.
Sure. Yeah, Mohawk Valley, as Brian points out, we are ramping the world's largest silicon carbide device fab, and we're doing that on 200mm wafers. We make devices today out of Durham on 150, and this facility will be making them off of 200. As Brian points out, we're in the process of ramping. We're doing both in internal qual, and we're gonna move to customer qual. The intent is Our fiscal year runs from July through June. In the March quarter, you know, there could be, you know, a small amount of revenue, and then we ramp a little bit more in the June quarter. The back half we expect to start running commercial devices or customer devices through the facility.
We're being cautious on that only because this is kind of the first time anyone has ever ramped a facility of this size.
and scale. You know, we wanna, you know, do it carefully, and the team has really done a really good job. At the Investor Day back in October. We talked about yields on 200mm at Mohawk Valley, and we were really encouraged. We felt that way only because we also had a pilot line that we received as part of the deal to open the device fab in New York. We've been running, you know, test material on that pilot line for some time, and it was actually yielding better than our 150mm commercial line in Durham. We're encouraged, but, you know, we're taking a cautious approach to that ramp.
Then on the new materials, you know, the Siler City facility coming online in, I think you mentioned 2024. It sounds like given the scale of that facility, you're gonna need more device capacity beyond what you've built in Mohawk. What's the latest thinking there timing-wise, location-wise? I'll get to the funding question later because that's always fun. Maybe just timing and location-wise, if there's any updates on the strategy.
We're getting close on the next fab is probably the best way to talk about it. What we're doing is we're looking very closely at There's the U.S. CHIPS Act, of course, that could provide in Europe. You know, as we think about, you know, first of all, geographic diversity comes into that consideration set. Customer input factors into that consideration set. Potential customer funding. You know, we announced a convert deal back in November that BorgWarner invested $500 million into that convert deal. As Brian mentions, you know, there are options on funding, and I would say the, you know, the device fab announcement hopefully shortly. On the Siler City announcement, you know, it's a massive facility.
Elif can tell you a little bit more about its capability, but once again, that facility is for 2 purposes, to help us fill out Mohawk Valley with the wafer needs there, and then potentially start to satisfy the first phase of production at this next fab.
There was also a recent wafer agreement e-expansion announcement you made recently. Will that capacity be coming from the new Siler City fab, or would that be a mix of the existing plan and the new one? Then I know you didn't identify the customer that you extended the deal for, but is it possible that this was the unnamed customer you did the deal for? I think in 2018 there was an $85 million deal. Any kind of term or scope details you're able to share on that recently announced deal?
Yeah. Brian, it's a question we've gotten a lot lately. Yes, that wafer expansion deal was with ROHM, and it was an expansion of an agreement that we announced back in October of 2018 but did not name them. You know, they've been a great customer for a significant amount of time. I can't speak directly to the terms of the deal with ROHM, but just in general, for those in the room, you know, a wafer supply deal, you should probably think about they're about a half decade in length. You know, and there's an upfront payment, you know, tied to that. You know, it helps us better plan for capacity. You know, ROHM has extended their agreement with us.
STMicroelectronics has also extended their agreement, a couple of times. You know, I think Back to Elif's point from earlier, I think, you know, our wafer customers are certainly working on their own internal capabilities, but they're also looking to supplement because the market and the demand is steepening a lot faster than we all thought.
I'm sure another investor question you've been getting a lot, Tyler, is around, you know, Durham. You know, we talked about the new facilities, but Durham, the existing legacy one, you had the manufacturing issue here recently, with the boule process tweak. Can you update us as to what the status of that is? Are you behind all the issues? Is it, kind of, you know, the implications for margins, I suppose, as well as you go forward from that?
I'd say this, you know, we constantly have innovation going on. You know, that's part of Elif's role and her team's role. This larger boule issue that we talked about on the last call, you know, we've probably seen the trough and. You know, from a productivity standpoint, it takes you time to. We talked about it's probably a quarter or 2 before we operating cadence in that regard. The good news is we've identified the issue and we've, you know, got a work-through in place, but it takes you time to catch up. That's why we kind of gave you the guide that we did for the quarter, you know, we'll update you. We've got a call at the end of this month, and we'll provide additional details.
That's kind of how we're thinking about it from this, from this point.
Let's talk about the outlook a bit, demand picture. You know, this is a start of the year conference, so everyone wants to know what's 23 gonna look like. For you guys it's less relevant because your pipeline, your backlog fill is very, you know, 24 and beyond. Clearly there's increasing concerns around just the macro environment, but also as it relates to consumer spending and discretionary and high price ticket items, which EVs kind of fall into that bucket. And we've seen, you know, EV leaders like Tesla have, you know, their issues in terms of selling and pricing. What gives you confidence? You've got these really robust targets for fiscal 24, fiscal 26, fiscal 27. You've got these design wins that are very large over the past few quarters.
In the context of all that's happening in the economic environment, like, what gives you the confidence that those, you know, those volumes can hold up, that the design-ins will actually translate into the revenue trajectory you've laid out thus far?
Yeah. I'd say this, Brian. I think, you know, we've announced, cumulatively over the last three years approximately $14.8 billion of design-ins. You should probably think, you know, 60 to 70% of that is for automotive. There's this increasingly, you know, growing trend on the automotive side because, you know, when we talk with OEMs and Tier 1, you know, we're seeing the end of the ICE Age. You know, the internal combustion engine is going away. Electrification of the powertrain is happening. I'd say this: I think, you know, short term, Brian, yeah, I think we've gotta pay very close attention. We're ramping facilities at the same time that, you know, we're going through a tighter economic period.
I think that, you know, there over the short term, there's definitely gonna be puts and takes, especially as we're ramping a new fab and starting construction on a brand-new materials factory. I think on the longer term outlook, we know that, you know, there will continue to be penetration of electric vehicles, and I think you're gonna reach an inflection point where the internal combustion engine car, because of the fixed cost tied to it, will become more expensive than an electric vehicle. Where we sit, the long-term outlook looks really strong. I think what we, you know, what we did back in October with the capital plan was kind of start to outline, you know, we see a demand curve for silicon carbide, but the supply coming to market is gonna be short and probably until the end of the decade.
We feel that, you know, putting in more materials capacity, putting in more device capacity, and the trends that we've seen through our design-ins give us kind the confidence in the longer-term outlook.
You do have, you know, the design-ins, and then you've announced a number of actual production wins with the likes of Jaguar and Land Rover, Mercedes-Benz, BorgWarner. The list goes on. So you have visibility under those contracts from what I understand in terms of clearly pricing, which you're fixing. Then I guess the question we get sometimes is volumes can move around. How do you sort of risk adjust these out-year targets when, you know, you're signing all these contracts but they won't kick in for several more years? I would assume to some degree there's variability on what the production runs will look like based on how well that product sells or doesn't. So are you risk adjusting?
kind a give us your framework for how those numbers are coming to fruition maybe?
Yeah. On the design-in number, think about that. That's a customer commitment of intent to use our products in their solution. We've got some things internally that we've looked at historical conversion rates so that the number that we give to the street is something that's been kind of adjusted, as you suggested, Brian, based on historical conversion trends. Will all of that convertible into revenue? There will certainly be some leakage. I think, you know, where we sit today is, you know, we're not trying to pick winners and losers. We're working with the OEMs directly. We're working with the Tier 1. We kind a know that, you know, there will be some that are very successful or on their forecasts, and we know that some will be adjusted.
I go back to the remark that I just made previously. We're supply constrained, and we're trying to add capacity, as so is the rest of the market. I think that, you know, we feel that, you know, we're covered in some regards, but we also understand that, you know, penetration rates and things could move depending upon economic conditions. That's where we're just paying very close attention to how much capacity we're bringing online. For example, the Siler City facility, we're standing up a four-wall facility, but we're gonna be modular in terms of the capacity that we install in there, so we have the ability to dial it up and down based on need.
Elif, maybe I'll bring you back into the conversation.
When Wolfspeed wins a device socket versus a peer, what?
are the major items that are driving that? The reverse of that, if you do lose a socket, what do you think ended up, you know, outside of the customer making the wrong decision?
Right.
what happened in that, procurement, process
to have you not be in that socket?
Right. Right. Thank you, Brian, for that. First of all, we have very high confidence on what our technology can achieve at the, you know, the device design and the performance leading, actually coming from the crystal quality of things. How we usually approach is that we wanna partner with the customers and the partners that who are actually we will be the primary source in the supply to them. That's how we approach usually. It works for them very well and as well as for us so that when we get into a mutual, you know, the partnership style, that it gives us the indication of what they expect, and also that we are able to then give them the assurance from our limited capacity.
That usually drives. I wanna add a little bit more color to that too. The way we also approach is that the, we let our, in the automotive field especially, that they're our customers or the partners there to, draw from our technical expertise, whether it's the, you know, the quality of the material or the process and what to expect and the defects in the epi device design, all the way leading up to the system-level expertise. We have that type of a, style and approach. We are in it for the, to be the primary supplier of the, for our customers. That basically drives our the winning or not winning taking those sockets.
Then maybe a follow-up on that. We get this asked all the time, on Tesla.
Yeah.
All right? Because they're the proxy for the EV space. You know, peers like STMicro, ON, they've made noise about being winners in particular models when it comes to silicon carbide penetration at that OEM.
We haven't heard anything out of Wolfspeed officially, so, you know, the perception is that you haven't been designed into anything on the Tesla fleet. What's your response to that?
I'd say this, Brian. Gregg Lowe, our CEO, has talked about this, that we are not bidding on any secondary opportunities. The only things that we're pursuing are primary supplier relationships in the automotive space. That's not because of arrogance. That's because of thoughtful planning. You know, capacity constraints are a big discussion, internally for us. What we wanna do is we wanna be front and center with that customer, understand what that forecast looks like. That's why we're sticking to just being primary suppliers to the OEM or the Tier 1 because we think it's just a better way to kind a have a dialogue with the customer.
If I may add to that of course at the device level, but we still support that when it comes back to converting the market to the BEV. We support ON and we support STMicroelectronics through our long-term agreements when it comes to the materials part of things to enable that.
That's a fair point.
Yeah.
We just have a few minutes left in the session, so I couldn't let you leave the stage, Tyler, without talking a little bit about financing.
I waited till the end. You did the $1.3 billion convertible recently. You upsized that. That was, you know, over $1.5 billion. I think that alleviated a decent amount of investor angst around the financing picture here, to your own admission, I think there's still some more capital needed.
this new device facility that sounds like you're pretty close on. Maybe just level set us as to, as we think about the next, you know, three, six, 12 months, I don't know what time, timeframe you're looking at, what's next up on financing, and then the next big sort of CapEx commitment you'll be having to make?
Yeah, no, thanks, Brian. It's a good question, and certainly appreciate, you know, the interest in it because, you know, it's a lotta capital to do raising in a tight market. As Brian pointed out, you know, we did a deal that secured $1.75 billion in a convert, and now we're looking at things in terms of various buckets like strategic financing. We still have government funding. As I mentioned earlier, you know, there's the US CHIPS Act and the IPCEI process going on in Europe that we think that we can benefit from. We're also, you know, looking. There's continued discussions with customers. Access to, you know, capacity is an important consideration, so there are potential customer funding deals.
Then I think that, you know, there are things like Department of Energy loans. As Brian points out, that, there's a, that's a longer fuse on that. You know, that takes about 12 months. We're gonna be looking at ways that we can kind of fund this final, you know, what I'll call initial phase of capital. As we think about, you know, the longer term outlook, you know, Mohawk Valley, you know, when that reaches full revenue potential at $2 billion, it'll throw off about $1.2 billion of cash. The, you know, that next, that H2 of funding will kind of be from operating cash flow and other sources.
We feel like that there are opportunities to tap the market for this H1 in those various buckets, and we intend to try and get that between now and the middle part of this year.
All right. That's great. I wanna thank the both of you, Elif and Tyler, for joining us up here on stage. I appreciate all the discussion and insight and thank you to the audience for keeping with us. Appreciate it. I think we're up for lunch next.
Thanks, Brian.
Thank you, Brian.