SolarEdge is closing down its energy storage division to focus solely on the core solar business
It will sell energy storage assets, including manufacturing facilities for battery cells and packs
The management expects to report close to $7.5 million with full run rate quarterly operating expenses savings by H2 2025
Israel-headquartered leading solar inverter and energy storage systems company SolarEdge Technologies is shuttering its energy storage business division in a strategic move, as it trains lens on its core solar business. The decision will impact around 500 company employees or 12% of its global workforce, most of them in South Korea.
SolarEdge’s Interim CEO Ronen Faier says the decision was carefully thought out after factoring in its portfolio of businesses and product lines, industry trends, and the competitive environment.
“The measures also represent continued execution of two of our main priorities: financial stability through cost reduction, return to cash flow positivity and profitability; and focus on our core business lines of solar, PV-attached storage and energy management capabilities,” he added.
Having started with DC power optimizer products, SolarEdge ventured into PV inverter manufacturing and later the energy storage business in 2015. Its energy storage portfolio comprises battery cells, modules, racks and containerized systems. In 2022, the company started its South Korean factory for residential solar-attached batteries with lithium-ion technology (see SolarEdge Gets Its Own Lithium-Ion Battery Fab).
Workforce reduction is expected to lead to approximately $7.5 million with a full run rate in quarterly operating expenses savings by H2 2025, according to the management.
It plans to now sell energy storage division assets, including its manufacturing facilities for battery cells and packs, but the management added that this will not impact its solar business sale of batteries for the residential and commercial and industrial (C&I) markets.
SolarEdge has been facing a rough patch for the past few quarters owing to a drop in electricity prices in Europe bringing down demand for residential solar, and high inventory levels due to cheaper Chinese alternatives in the market. In Q3 2024, it registered a GAAP net loss of $1.21 billion (see SolarEdge Reports $1.21 Billion GAAP Net Loss For Q3 2024).
The company has also been facing growing competition from microinverter manufacturer Enphase Energy and Tesla’s Powerwall 3. Donald Trump’s win in the US Presidential elections brought uncertainty to the US market as several solar companies saw their stocks tumble, including SolarEdge (see Fate Of US Solar PV Industry Under Donald Trump 2.0).
Its decision to exit the energy storage business and focus on solar was met with pleasure by the market as the company stocks went up by over 2% soon after the announcement.