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Restructuring | 6 Months Ended
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Dec. 29, 2024
Restructuring and Related Activities [Abstract] |
Restructuring | Restructuring During the first quarter of fiscal 2025, the Company initiated a headcount reduction and facility closure and consolidation plan intended to optimize its cost structure as the Company accelerates its transition from 150mm to 200mm silicon carbide devices (the 2025 Restructuring Plan). The actions taken under the 2025 Restructuring Plan will ultimately result in the closure of the Company's 150mm device fabrication facility in Durham, North Carolina as well as a realignment of related activities across the geographic regions in which the Company operates. The Company also recently initiated plans to consolidate its manufacturing footprint for epitaxy products by winding down operations at its facility in Farmer's Branch, Texas during fiscal 2025. The Company is taking steps to optimize the allocation of resources across various functional groups. The Company expects these actions will result in a total headcount reduction of approximately 20% over the next three to nine months. In the second quarter of fiscal 2025, the Company implemented an early exit program for a limited number of eligible employees based on their age and years of service. The costs that will be incurred as a result of the 2025 Restructuring Plan include severance and employee benefit costs, voluntary termination benefits, and other exit costs that qualify as exit and disposal costs under U.S. GAAP. The severance costs incurred during the first quarter of fiscal 2025 were provided under an ongoing benefit arrangement and were therefore recorded once they were both probable and reasonably estimable in accordance with the provisions of ASC 712-10, “Nonretirement Postemployment Benefits”. Additionally, the Company has incurred, and over the next 9 months will continue to incur, additional facility closure-related costs related to these activities, including asset-related charges and fixed manufacturing costs that will be eliminated as a result of this plan and other incremental costs to exit facilities. Including these additional facility closure-related costs, the Company expects to incur approximately $400 million to $450 million of total costs, including approximately $60 million of involuntary and voluntary severance costs, $125 million of other closure-related cash costs, and approximately $250 million of asset-related charges and other non-cash costs. The Company expects to realize approximately $200 million of annualized cost savings upon completion of these initiatives. A summary of the charges recognized in the consolidated statements of operations through the second quarter of fiscal 2025 resulting from these restructuring activities is shown below:
| Three months ended |  | Six months ended
(in millions of U.S. Dollars) | December 29, 2024 |  | December 29, 2024
Accelerated depreciation | $11.7 |  |  | $23.4 |
Other closure-related costs | 19.7 |  |  | 42.3 |
Total cost of revenue, net | $31.4 |  |  | $65.7 |
Impairments on abandoned assets(1) | $124.5 |  |  | $124.5 |
Severance(2) | $15.0 |  |  | $51.5 |
Accelerated depreciation | 5.7 |  |  | 12.8 |
Other closure-related costs | 11.5 |  |  | 20.7 |
Total other operating expense | $32.2 |  |  | $85.0 |
Total | $188.1 |  |  | $275.2 |
(1)Presented in loss on disposal or impairment of other assets (2)Employee severance and benefit costs include the early exit program payments A summary of the balance sheet activity related to these restructuring activities recognized in accounts payable and accrued expenses in the unaudited consolidated balance sheet as of December 29, 2024 follows:
(in millions of U.S. Dollars) | As of June 30, 2024 |  | Charges | Usage | December 29, 2024
Employee severance and benefit costs(1) | $— |  |  | $51.5 |  | ($23.4) |  | $28.1 |
Contract termination liability | — |  |  | 1.1 |  | — |  | 1.1 |
Total | $— |  |  | $52.6 |  | ($23.4) |  | $29.2 |
(1)Employee severance and benefit costs includes the early exit program activity

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- Definition The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 5.P.4.e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479823/420-10-S99-2 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (b)(2) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482017/420-10-50-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482017/420-10-50-1 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/420/tableOfContent Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482017/420-10-50-1 + Details
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