Spectrum-splitting is a beneficial technique to increase the efficiency and reduce the cost of photovoltaic (PV) systems. This method divides the incident solar spectrum into spectral components that are spatially separated and directed to PV cells with matching spectral responsivity characteristics. This approach eliminates problems associated with current and lattice matching that must be maintained in tandem multi-junction systems. In this paper, a two-junction holographic spectrum-splitting photovoltaic system is demonstrated with a folded PV geometry. The system is designed to use both direct and diffuse solar irradiation. It consists of holographic elements, a wedge-shaped optical guide, and PV substrates with back reflectors. The holographic elements and back reflectors spatially separate the incident solar spectrum and project spectral components onto matching PV cell types. In addition, the wedge-shaped optical guide traps diffuse illumination inside the system to increase absorption. In this paper, the wedge spectrum splitting system is analyzed using tabulated data for InGaP2/GaAs cells with direct illumination combined with experimental data for reflection volume holograms. A system efficiency of 31.42% is obtained with experimental reflection hologram data. This efficiency is a 21.42% improvement over a similar system that uses one PV cell with the highest efficiency (GaAs). Simulation results show large acceptance angle for both in-plane and out-of plane directions. Simulation of the output power of the system with different configurations at different times of the year are also presented.