Canadian Solar exceeded Q1 shipment guidance for both solar modules and battery storage
Its gross margin increased to 25.1%, helped by tariff refund benefits and US manufacturing operations, while narrowing net loss
The company expects higher storage volumes in Q2 while reiterating annual guidance
Canadian Solar reported Q1 2026 revenue of $1.1 billion, reaching the high end of its guidance range, while solar module and energy storage shipments both exceeded company expectations. While it met the upper end of its guidance, net revenues dropped 11% sequentially and 10% annually due to lower module sales, partially offset by higher battery energy storage system (BESS) sales.
The company also announced a leadership transition, appointing Colin Parkin as Chief Executive Officer (CEO) effective May 14, 2026, while Founder Shawn Qu transitioned to Executive Chairman and Chief Technology Officer (CTO). This is a promotion for Parkin, who was appointed the company’s President in January 2026 (see Canadian Solar Names Colin Parkin As President).
“The first half of the year reflects prevailing market challenges, with solar margins remaining under pressure. In our energy storage business, margins are normalizing, and we remain partially exposed to fluctuations in lithium carbonate pricing,” said Parkin. “These factors, combined with a broader backdrop of policy uncertainty and geopolitical volatility, continue to impact both customers' long-term planning and our own operational execution.”
In Q1 2026, it shipped 2.5 GW of solar modules, above its guidance of 2.2 GW to 2.4 GW, but this represented a 42% quarter-on-quarter (QoQ) and 64% year-on-year (YoY) drop.
BESS shipments reached 2.1 GWh, surpassing the forecast range of 1.7 GWh to 1.9 GWh, while representing 5% QoQ and 142% YoY increase.
Gross margin rose to 25.1%, supported by a $93 million tariff refund benefit. Nevertheless, Canadian Solar reported a net loss of $32 million, which it narrowed from $86 million in the previous quarter and $34 million in Q1 2025 (see Canadian Solar Misses FY 2025 Guidance; Pushes US HJT Expansion).
The manufacturer shared that trial production at its heterojunction (HJT) solar cell factory in Jeffersonville, Indiana, began in April this year with 2.1 GW nameplate capacity under Phase I. Phase II will add 4.2 GW, with trial production scheduled for the beginning of 2027. With its completion, Canadian Solar’s total US solar cell nameplate capacity will expand to 6.3 GW, increasing the production capacity from the originally announced 5 GW.
The company is also expanding its Mesquite, Texas, solar module facility to 10 GW nameplate capacity by H2 2026, up from its current operational capacity of 5 GW.
For Q2 2026, Canadian Solar expects revenue of $1.0 billion to $1.2 billion, module shipments of 3.1 GW to 3.3 GW, and battery storage shipments of 2.8 GWh to 3.2 GWh. For full-year 2026, it reiterates module shipment guidance of 6.5 GW to 7.0 GW, and BESS shipment outlook for the US market of 4.5 GWh to 5.5 GWh.
Parkin added, “We anticipate stronger storage volumes and the benefits from the ramp-up of our U.S. domestic solar cell manufacturing to be weighted toward the second half, while our project development business continues to execute on its rebalancing strategy.”