SolarEdge Earned $52.8 Million Net Income In Q4/2019

SolarEdge Continues Good Run Improving Net Income In Q4/2019 & 2019; Says Company Dealing Well With Impacts Of Coronavirus; Guides For Q1/2020 Revenues Between $425 Million To $440 Million
11:28 AM (Beijing Time) - 21. February 2020
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For SolarEdge, the last quarter of 2019 was a successful one as it reported GAAP net income growing to $52.8 million and a higher gross margin on QoQ and YoY basis. (Source: SolarEdge Technologies, Inc.)

Key Takeaways

  • During Q4/2019, SolarEdge said its business achieved revenues of $418.2 million with solar business division bringing in $389 million
  • Full year 2019 revenues grew 52% annually to $1.43 billion with gross margin of 33.6% which dropped from 34.1% last year
  • Continued production at low rates in China during Chinese New Year holidays and increase in capacity at Hungary and Vietnam is helping the company deal with the delays stemming from coronavirus impact
  • Management has guided for expected solar business revenues of up to $415 million to add up to a total of $425 million to $440 million revenue guidance for Q1/2020

Solar PV inverter manufacturer SolarEdge Technologies, Inc. exited 2019 emerging stronger than ever. It reported a GAAP net income of $52.8 million in Q4/2019, growing over $12.9 million earned a year back and $41.6 million during last quarter (see SolarEdge Reports Strong Quarter In Q3/2019).

Of the total revenues of $418.2 million during the reporting quarter, the Israeli company’s solar business division brought in $389 million with GAAP gross margin for solar being 37.3% from 1.6 GW AC of inverters shipped. Most shipments went to North America followed by Europe. As for power optimizers, it shipped 4.5 million.     

Demand for commercial products  

A leader in the residential space in the US market, as per Wood Mackenzie Power & Renewables, SolarEdge shared its Q4/2019 shipments had ‘strong momentum in commercial shipments’ and it expects 20% to 30% of further growth in this segment during Q1/2020 as it pointed towards a 1 GW commercial products deal with Enfindus earlier this month (see SolarEdge Bags European Solar Deal For 1 GW Capacity). 

2019

A successful Q4 led to annual revenues in 2019 to be reported at $1.43 billion, growing 52% annually at a gross margin of 33.6% which was slightly down from 34.1% last year. GAAP net income for the full year went up 14% YoY to $146.5 million.

Withstanding Coronavirus impact so far

With a strong inventory that was built in Q4/2019 and dispatched to distribution centers before the deadly coronavirus outbreak in anticipation of the Chinese New Year holidays, SolarEdge said it has been able to withstand the impact on its delivery schedule. At the same time, the company continued manufacturing at its Chinese location at reduced rates during the new year holidays and with the extension of the holidays due to coronavirus, the manufacturing lines kept working. The company also increased capacity at its Hungary and Vietnam lines to meet demand.

Guidance

During Q1/2020, SolarEdge expects to earn revenues worth $425 million to $440 million with a gross margin of 32% to 34%. The solar segment is expected to contribute the largest share by far, ranging between $405 million to $415 million and bringing in a gross margin of $33% to 35%.

While the management did not share guidance for full financial year 2020, during its analyst day in November 2019 it had said that it expects annual solar revenues in 2020 to grow 15% to 20% with GAAP gross margins of 35% to 37%, even as the eventual strategy is to bring down the solar inverter share to balance the ratio of all its business divisions (see SolarEdge To Double Capacity By 2020 Year End).

In a separate statement, SolarEdge said the company’s acting CEO Zvi Lando will now be company’s permanent CEO and has been inducted into the Board of Directors.

Anu Bhambhani

Anu Bhambhani is the Senior News Editor of TaiyangNews

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Anu Bhambhani