Shares of silicon carbide (SiC) chipmaker Wolfspeed (NYSE: WOLF) enjoyed a small relief rally after its latest earnings report. The company is in the midst of ramping up a big new factory in support of next-gen power semiconductors for applications like electric vehicles (EVs).

However, while progress is a positive sign, Wolfspeed still has much to prove in the next couple of years -- and could burn through ample amounts of cash while it does so. Investors should remain cautious with this chip stock.

Recent media reports have highlighted weakening growth for the EV market. Blame higher interest rates. Currently, EVs are more expensive than traditional cars, and with financing costs up substantially this year, some consumers are on hold with a new car purchase.

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Source Fool.com