Solaredge, a technology company that specializes in solutions for the solar energy industry, experienced another weak quarter in the first quarter, with no signs of recovery yet. Just two weeks ago, competitor Anphase announced market recovery delays, which caused Solaredge’s stock to plummet. After releasing their financial reports yesterday, Solaredge’s stock dropped by 8.5% in late trading.
The company has been struggling with declining demand for several quarters due to high inventory levels held by distributors. Despite first-quarter revenues being higher than analysts’ forecasts at $204 million, a 78% drop from the corresponding quarter, solar sector revenues fell by 33% to $190 million. Revenues from Europe accounted for 45%, while those from the USA made up 34%, and the rest came from the rest of the world.
Solaredge reported a gross loss of $26.2 million and a net loss according to GAAP rules of $157 million compared to a profit of $138 million in the corresponding quarter. The company’s cash flow from operations was negative at $217 million and cash in the treasury decreased by $124 million to $214 million in the quarter.
For the second quarter, Solaredge expects revenues of $250-280 million, an improvement over the first quarter but still a decrease compared to the corresponding quarter. The company plans to focus on new products as they prepare for future growth opportunities in preparation for the next growth cycle in their industry.
After announcing layoffs of 900 employees earlier this year, Solaredge is currently trading at around $3 billion on Nasdaq, significantly down from its peak value of $20 billion. Despite these challenges, Solaredge remains optimistic about new product launches and increased demand in the solar sector for future growth opportunities.
