Restructuring

3 Months Ended

Sep. 26, 2021

Restructuring and Related Activities [Abstract]

Restructuring

Restructuring

The Company has approved various operational plans that include restructuring costs. All restructuring costs are recorded in other operating expense on the consolidated statement of operations.

Factory Optimization Restructuring

In May 2019, the Company started a significant, multi-year factory optimization plan anchored by a state-of-the-art, automated 200mm capable Silicon Carbide and GaN fabrication facility and a large materials factory at its U.S. campus headquarters in Durham, North Carolina. As part of the plan, the Company will incur restructuring charges associated with the movement of equipment as well as disposals on certain long-lived assets.

In September 2019, the Company announced its intent to build a new Silicon Carbide device fabrication facility in Marcy, New York to complement the factory expansion underway at its U.S. campus headquarters in Durham, North Carolina. The Company has commenced the building of the New York facility and is currently evaluating the impact of this decision on future restructuring charges.

The Company expects approximately $90.0 million in restructuring charges related to the factory optimization plan to be incurred through 2024. For the three months ended September 26, 2021, the Company expensed $1.6 million of restructuring charges associated with the movement of equipment related to the factory optimization plan, of which $0.3 million is accrued for as of September 26, 2021. Additionally, the Company expensed $1.0 million of restructuring charges associated with disposals of certain long-lived assets for the three months ended September 26, 2021.

For the three months ended September 27, 2020, the Company expensed and paid $2.6 million of restructuring charges associated with the movement of equipment related to the factory optimization plan.

Corporate Restructuring

In September 2020, the Company realigned certain resources to further focus on areas vital to our growth while driving efficiencies. As a result, the Company recorded $2.8 million in severance-related costs during the three months ended September 27, 2020. The plan has concluded and all expenses were paid as of June 27, 2021.