Canadian Solar Beats Q4/2023 Solar Module Shipment Guidance

• Canadian Solar's Q4/2023 revenues declined sequentially and annually to $1.7 billion, but it exceeded module shipment guidance 
• Full-year revenues were a record $7.6 billion, according to the management, along with total module shipments of 30.7 GW 
• It guides for full-year 2024 module shipments to range between 42 GW and 47 GW, but expects seasonality in Q1 

Canada-headquartered solar PV manufacturer Canadian Solar exceeded its shipment guidance for Q4/2023, even though its revenues suffered 8% QoQ and 14% YoY decline thanks to the decline in module ASPs, along with a drop in shipment volume and lower project sales. Impact to $1.7 billion revenues was offset by higher battery energy storage solutions sales. 

Gross profit decreased 31% QoQ and 39% YoY to $213 million. Lower module ASPs and an inventory write-down, partially offset by lower manufacturing costs and higher storage sales led to a gross margin of 12.5%. It declined from 16.7% in the previous quarter. 

Its total solar module shipments of 8.2 GW during the reporting quarter increased 26% YoY, but dropped 2% QoQ. China, the US, Brazil, Spain and Pakistan were the top 5 destinations for its modules. 

Full-year 2023 solar module shipments of 30.7 GW by its subsidiary CSI Solar represented a 45% annual increase. The full-year net income was a record $274 million, it adds, along with a record $7.6 billion in revenues. 

CSI Solar President Yan Zhuang said the company managed this shipment growth despite challenging market conditions. "As the market undergoes further normalization and consolidation, we see vertical integration, advanced technology, and a robust go-to-market strategy as key to competitive edge. We maintain our strategic long-term investments across vertical integration, TOPCon and other N-type technologies, and our U.S. manufacturing capabilities," added Zhuang.  

At the end of 2023, the company had a total solar development pipeline of 27.3 GW, and 55 GWh for battery energy storage. The solar development pipeline, managed by Recurrent Energy, is spread globally with the largest chunk of 9.9 GW in the EMEA, followed by 6.4 GW in North America and 5.1 GW in Latin America, among other regions. 

The management says it has revised its nameplate solar manufacturing capacity expansion targets to reach 50.4 GW, 50 GW, 55.7 GW and 61 GW for ingots, wafer, cell and modules, respectively, by December 2024. Previously, it guided for 55 GW for wafers and 60 GW for cells. Target expansion for ingots and modules remains unchanged. This is the company's 2nd revision for its wafer and cell expansion plans as it initially expected to grow to 60 GW and 70 GW, respectively (see CSIQ's Q3/2023 Revenues Drop With Lower ASPs). 

Guidance 

For full-year 2024, Canadian Solar expects to report an annual growth of around 37% to 53% for its total module shipments. These will range from 42 GW to 47 GW, along with 6.0 GWh to 6.5 GWh of battery energy storage shipments. Total revenues for the year will be between $8.5 billion and $9.5 billion. 

Anticipating 'seasonally softer' Q1/2024, the management guides for revenues of $1.2 billion to $1.4 billion, and gross margin of 17% to 19%. Total module shipments are forecast to range within 6.1 GW to 6.4 GW, while it targets to ship close to 1 GWh for battery storage. 

Canadian Solar Chairman and CEO Dr. Shawn Qu added, "Our optimism toward global market prospects endures, as we project accelerated growth momentum in the latter part of the year. This positive outlook is driven by the clearance of channel inventory in distributed generation markets and burgeoning demand unleashed by emerging markets."