Enphase forecasts lower revenue as residential solar demand weakens
Enphase’s fourth-quarter revenue forecast falls below its third-quarter sales as residential solar demand remains weak. US end-customer sales were down sharply from a year earlier, while European demand also weakened. The solar equipment producer reported a narrower adjusted gross margin and little operating cash generation in the latest quarter.
Economics & Markets··Morning
US end-customer sales fall 35 per cent over a year
Enphase Energy, the solar equipment producer, announced its third-quarter results on 27 October. Its quarterly earnings and revenue missed consensus estimates.[1], [2]
Revenue reached 293.3 million dollars, compared with 291.9 million dollars in the preceding quarter. US end-customer sales rose 5 per cent from the previous quarter but remained 35 per cent below the prior-year level. Global end-customer sales grew just 1 per cent sequentially, against management’s expectation of 10 per cent growth.[1]
European demand and adjusted margin weaken
European revenue fell approximately 11 per cent from the preceding quarter. European end-customer sales declined 12 per cent, with weak demand in France. Adjusted gross margin narrowed to 45 per cent from 46.8 per cent. The company attributed the margin decline to product mix and put the impact of reciprocal tariffs at approximately 1.3 percentage points.[1]
Management forecast fourth-quarter revenue of 225 million dollars to 255 million dollars, including approximately 51.2 million dollars of advance-purchase sales under tax arrangements. Its forecast assumes a 10 per cent sequential fall in end-customer sales. During the third quarter, operating cash generation was approximately 0.1 million dollars against capital spending of 11.5 million dollars. Cash, equivalents and marketable securities totalled 931.8 million dollars at the period’s end.[1]
