The DOD offers chipmaker Wolfspeed, which filed for bankruptcy in 2025, a conditional loan of up to $1.5B in exchange for warrants for up to 7.5% of the company (Lynn Doan/Bloomberg)

The Defense Department’s conditional $1.5 billion loan to bankrupt chipmaker Wolfspeed signals that U.S. policymakers are still willing to back strategically important semiconductor capacity, even as the company remains financially distressed. For CIOs and technology leaders, this is another reminder that chip supply chains can become geopolitical and operational risks, making supplier concentration, lead times, and continuity planning core business issues rather than just procurement concerns.