SunPower: Record Residential Bookings In Q3/2019

SunPower Exceeds Revenue Guidance, Claims Record Residential & New Home Bookings With Over 40,000 New Homes Backlog In California & Realigns Energy Services Business For Residential/Small Commercial Dealer Channels
07:25 AM (Beijing Time) - 04. November 2019
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With a strong third quarter—thanks to a residential segment uptick—SunPower looks well-positioned to exit 2019. (Source: SunPower Corp)

Key Takeaways

  • In Q3/2019, SunPower reported record residential and new homes bookings; in California it has over 40,000 new homes backlog
  • NGT production plans to produce 100 MW and install 250 MW nameplate capacity within 2019 remain on track
  • Management expected to announce the funding source for its NGT technology expansion sometime in Q4/2019
  • Full year 2019 deployment guidance has been revised upwards to 2.1 GW to 2.3 GW as against the previous guidance of 2.05 GW to 2.25 GW, excluding 200 MW of safe harbour capacity

SunPower Corp., the US based vertically integrated module manufacturer striving to develop into an energy services company catering to the distributed generation (DG) segment, exceeded its own revenue guidance for the third quarter of 2019. It reported GAAP revenues a little over its guidance at $476 million, yet its net loss for the quarter was $15 million, compared to a net income of $121.5 million in Q2/2019 (see SunPower Returns To Profitability In Q2/2019).

However, what’s noteworthy from SunPower’s Q3/2019 results is the record residential and new homes bookings it claims to have secured during the period with strong traction in California ahead of the state’s mandate of all new homes built here from 2020 onward to have solar panels. And with the recent blackouts by utility Pacific Gas and Electric (PG&E), people wanting solar panels want energy storage too.

SunPower said in Q3/2019, 80 new home communities used SunPower panels, and it has now a backlog of over new 40,000 homes which Norman Taffe, the company’s Executive Vice President, North America Residential, claimed is almost 100% California in a call with analysts. SunPower also launched its Equinox storage solution for the residential market which it plans to start shipping in Q1/2020. This, it said, can operate even during power outages.

Transitioning from its IBC back contact 5-inch cell size to its 6-inch Next Generation Technology (NGT), SunPower’s search for a partner to fund its expansion plants for NGT seems to have found a headway and the management plans to announce details in Q4/2019. However, its nameplate manufacturing capacity plans for NGT remain on track to achieve 250 MW by the end of 2019 and produce 100 MW of its Maxeon-5 technology this year (see Production Expansion On SunPower’s Mind In 2019).

“We continue to believe NGT is a key enabler of margin expansion on the SPT side of the business given the value the DG market puts on higher efficiency panels. The strategy to pivot to DG is pacing well and we are optimistic about SunPower’s growing backlog,” said Jeffrey Osborne with the analyst firm Cowen.

Beginning Q4/2019, SunPower has decided to realign its SunPower Energy Services (SPES) business by combining residential and small commercial dealer channels.

Guidance

For the fourth quarter of 2019, SunPower has guided for a wide range of expected GAAP revenue between $520 million and $720 million with 11% to 12% gross margin, but net loss of $28 million to $8 million while the company hopes to deploy 445 MW to 645 MW during the ongoing quarter.

For the entire year 2019, SunPower’s guidance is largely unchanged except for the deployments that it sees now to hover between 2.1 GW to 2.3 GW as against the previous guidance of 2.05 GW to 2.25 GW. This does not include 200 MW it has safe harboured with Hannon under the US federal Investment Tax Credit (ITC) (see SunPower To Preserve 200 MW Solar In JV).

Anu Bhambhani

Anu Bhambhani is the Senior News Editor of TaiyangNews

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Anu Bhambhani