Navitas Semiconductor Loses Half Its Value as Dilution Fears Overwhelm GaN Growth Story

The world’s largest cloud providers are expected to spend nearly $800 billion on AI infrastructure this year, yet one key supplier of energy-efficient power chips has seen its stock get cut in half over the past month. Navitas Semiconductor, a developer of gallium nitride (GaN) and silicon carbide (SiC) power semiconductors, has watched its shares tumble from a May high of €29.20 to as low as €12.80 on Tuesday before closing at €13.50. That leaves the stock down roughly 54% to 56% from its peak — a rout that has erased the bulk of its earlier 2026 rally.

The selling has been relentless: the stock lost 36.9% over the past 30 days and 14% in the last week alone. With an annualized 30-day volatility of 119.6%, Navitas trades more like a binary bet on the future of power efficiency than an established semiconductor name. Its market capitalization stands at €3.09 billion, and the shares are now 27.3% below their 50-day moving average of €18.57. The 14-day relative strength index of 36.3 suggests the stock is approaching oversold territory, but so far that signal has failed to attract buyers.

The catalyst for the sell-off stems from a June agreement that allows Navitas to issue up to $500 million in new shares through banks including Morgan Stanley. The company itself warned that the move would immediately dilute existing shareholders. The mere prospect of further equity sales has crimped sentiment, especially in a stock that already trades with a price-to-sales multiple that commands a premium for future growth. Adding to the unease, board chairman Ranbir Singh abruptly resigned in early June, compounding the sense of management instability.

Should investors sell immediately? Or is it worth buying Navitas Semiconductor Corporation?

Behind the volatility lies a fundamental tension between Navitas’s long-term technological promise and the market’s demand for proof. The industry is pivoting from traditional silicon to wide-bandgap materials like GaN and SiC, which offer superior efficiency for AI data centers and electric vehicles. Navitas is positioning itself as a leader, partnering with NVIDIA MGX and recently introducing new isolated through-hole packages for SiC MOSFETs. Analysts project the GaN power semiconductor market will grow from $2 billion in 2024 to $9.5 billion by 2035. Yet JPMorgan recently warned that the chip sector’s outperformance since late 2025 may have peaked, as large tech firms increasingly develop their own chip solutions. Navitas, while focused on a niche that should benefit from AI’s power demands, is being priced with a hefty execution risk.

That skepticism is reflected in analyst price targets. The consensus target for Navitas stands at €12.67 — a level 6.1% below the current share price. It is unusual for analyst targets to sit below the market price, and it signals that institutional investors see limited upside until the company delivers tangible margin expansion. For now, the stock is caught between its technological lead in GaN and a market that wants to see those advantages turn into sustainable profitability.

The next major inflection point comes at the end of July. Navitas will report second-quarter earnings on July 27, 2026, with CEO Chris Allexandre and CFO Tonya Stevens leading the call. The company generated $8.6 million in Q1 revenue, beating its own forecast, and has guided for around $10 million in Q2. But investors will be watching the AI segment closely: only hard revenue growth in that area can justify the stock’s risk premium and offset the dilution overhang. Until those numbers arrive, Navitas remains a high-volatility bet on the energy efficiency of AI infrastructure — a story the market clearly wants to believe, but only on stronger evidence.