Canadian Solar’s Q2 2026 revenue increased sequentially, but the company remained loss-making as gross margin fell sharply
Its US manufacturing expansion is moving ahead alongside a sizable contracted module backlog
Canadian Solar is preparing a technology path beyond HJT and TOPCon toward QBC, Space PV and tandem cells
Canadian Solar increased its Q2 2026 revenue sequentially as solar module and battery storage shipments rose, but profitability weakened sharply. The company also outlined plans to expand its US manufacturing base and move toward newer solar cell technologies.
The company reported $1.21 billion in net revenue for Q2 2026, meeting the higher end of its guidance for the quarter, up 12% from the first quarter but down 29% year-on-year (YoY). Gross margin fell to 13.9%, compared with 25.1% in Q1 and 29.8% a year earlier (see Canadian Solar Q1 2026 Revenue Reaches $1.1 Billion).
Canadian Solar’s Chief Financial Officer (CFO) Xinbo Zhu said the lower sequential margin was mainly due to the absence of an IEEPA tariff refund recorded in the previous quarter, along with normalized energy storage margins.
Its net loss for the quarter widened to $77 million, from a $32 million loss in Q1. The company had reported net income attributable to Canadian Solar of $7 million in Q2 2025.
Canadian Solar’s recognized revenue from 3.1 GW of solar module shipments during the quarter, up 25% sequentially but down 60% YoY.
On the other hand, battery energy storage shipments reached 3.7 GWh, an 82% increase from Q1 and 73% higher than a year earlier, representing $426 million in revenue. Of the storage shipments, 471 MWh were delivered to the company's own projects under execution, with the related revenue to be recognized in later quarters.
Its manufacturing business generated $1.10 billion in revenue and $131 million in gross profit, giving the segment an 11.9% gross margin, down from previous quarter’s 29.1%.
Recurrent Energy generated $117 million in revenue, with a 30.7% gross margin. The company said Recurrent Energy's quarterly performance was affected by the deferral of planned project sales into the second half of the year. Electricity revenue increased following the commercial operation of a major utility-scale solar project in Spain.
Canadian Solar officially opened the first phase of its HJT solar cell factory in Jeffersonville, Indiana, in July through CS Power Tech. Phase I has a nameplate capacity of 2.1 GW. The company expects to begin trial production at Phase II in Q1 2027. The expansion would add another 4.2 GW, taking total US solar cell capacity to 6.3 GW, making it the ‘largest’ crystalline silicon solar cell factory in North America (see Canadian Solar Opens 6 GW HJT Cell Plant In Indiana).
It is also expanding the Texas module factory from 5 GW to 10 GW, with completion expected in H2 2026. The management claims more than 13 GW of contracted US module backlog, worth more than $4.5 billion as of August 14, 2026. The backlog extends from H2 of 2026 into 2027 and beyond.
CEO Colin Parkin said US solar and storage shipments are expected to accelerate in the second half of the year, while ramp-up costs at the Jeffersonville cell facility are expected to weigh on profitability for the rest of 2026.
Canadian Solar's e-STORAGE business had a $3.5 billion contracted backlog as of June 30, 2026. It also had 34 GWh of operating projects contracted under long-term service agreements. Recurrent Energy had a global solar development pipeline of 21.7 GW and a battery storage pipeline of 84.1 GWh at the end of June.
The solar pipeline included 1.7 GW under construction and 2.2 GW in backlog, while the storage pipeline included 600 MWh under construction and 4.4 GWh in backlog.
Canadian Solar's technology roadmap extends from current HJT and TOPCon technologies toward quad back contact (QBC), space PV and tandem cells. Through 2028, it plans to improve HJT and TOPCon modules raising their efficiency from 23.2% to 24.4% while reducing silver use from 6.5 mg/W to 3 mg/W.
Shawn Qu, Executive Chairman and CTO shared that in 2028 it will target mass production of QBC technology with module efficiency of 24.8% to 25.2%, and silver use of 1-2 mg/W. It also expects Space PV shipments in 2029, while tandem shipments are targeted for the 2030s with module efficiency above 30%.
The roadmap also includes newer energy storage technologies. SolBank 3.0 is positioned for 2026-28, followed by SolBank 4.0 and a sodium-ion battery product, while the power electronics roadmap includes higher-capacity medium-voltage skids and a solid-state transformer.
For Q3, Canadian Solar expects revenue of $1.3 billion to $1.5 billion, with gross margin between 13.5% and 15.5%. Global module shipments are expected within 3.5 GW and 3.8 GW, while battery storage shipments are forecast at 3.4 GWh to 3.8 GWh. The company maintained its 2026 US shipment guidance of 6.5 GW and 7.0 GW of solar modules and 4.5 GWh to 5.5 GWh of utility-scale battery storage.
It also expects delayed Recurrent Energy project sales from Q2 to be realized in Q3.
