The Q4 2024 revenues for Shoals were in line with its guided range. (Photo Credit: Shoals Technologies Group, Inc.)  
Business

Shoals Technologies Achieved Higher End Of Q4 2024 Revenue Guidance

US company blames project delays and competitive dynamics among factors responsible for business decline

Anu Bhambhani

  • Shoals has reported revenues of $107 million for Q4 2024 and $399.2 million for FY2024, both declining by 18% YoY 

  • Project delays and lower sales volumes were primarily responsible for the decline in revenues  

  • Backlog and awarded volume were flat on a YoY basis, but 6.5% higher than at the end of September 2024 at $634.7 million 

US-based electrical balance of system (EBOS) and battery energy storage (BESS) solutions provider Shoals Technologies Group has reported $107 million in revenues for Q4 2024, achieving the higher end of its guidance.  

This was a year-on-year (YoY) drop of 18%, while the company’s gross profit declined by 27.4% to $40.2 million. Gross profit was 37.6% as a percentage of revenue, compared to 42.5% in Q4 2023 owing to the competitive environment and higher material costs that were slightly offset by improved leverage on labor costs, according to the company. 

Shoals’ management blames the revenue drop on lower sales volumes. This was due to lower demand with solar project delays pushing projects out from 2024. It also attributes competitive dynamics, volume discounts, and customer mix in its key markets as the secondary factors.  

Its adjusted EBITDA of $26.4 million was down 32.5% over the same period while its net income of $7.8 million declined from $16.58 million on a YoY basis. 

Lower sales volumes pulled down its revenues for FY2024 also by 18% YoY to $399.2 million. Gross profit for the year was $142 million representing 35.6% of revenue, up from 34.4% due to a reduction in wire insulation shrinkback expenses recorded in 2024. It was slightly offset by an increase in raw materials and labor input costs, it added. 

Shoals started the year 2025 with close to $635 million in backlog and awarded orders. (Photo Credit: Shoals Technologies Group, Inc.)

Shoals’ backlog and awarded order volume were flat on a YoY basis, but 6.5% higher than at the end of September 2024 with $634.7 million. “The increase in backlog and awarded orders reflects continued demand for the Company’s solar products, with growth in new domestic and international markets,” stated the management.  

Guidance 

Shoals was cautious in its guidance for FY2025 as it expects to report revenues between $410 million and $450 million and adjusted EBITDA of $100 million to $115 million. For Q1 2025, it forecasts $70 million to $80 million in revenues and $10 million to $15 million in adjusted EBITDA.  

“The Company is providing an outlook for the first quarter given the headwinds in the utility scale solar market, which have resulted in certain customers changing order patterns,” it explained.  

Patent infringement 

Shoals started the year 2025 with a new patent infringement case against Voltage in the US Court of Appeals for the Federal Circuit. It has filed an appeal requesting a reversal of the ITC’s decision to overturn a prior ruling that Voltage’s LYNX trunk bus products infringe Shoals’ ’153 Patent.  

It has sought a de novo review, meaning that the court will review the interpretation without deferring to the ITC’s latest determination. The ITC has also decided to launch a new investigation into Voltage’s infringement of Shoals’ 2 newly issued ’375 and ’376 patents. These relate to an improved trunk bus lead assembly for solar energy projects. 

“This appeal and the filing of the new ITC complaint confirm Shoals’ commitment to enforce our intellectual property rights and to prevent the illegal importation of trunk bus lead assemblies that infringe these rights,” Brandon Moss, CEO of Shoals Technologies Group stated. “We will continue to protect our American jobs, facilities, production and innovation from attack by a foreign producer and importer of infringing products.”