- SolarEdge has unveiled plans to set up a US manufacturing fab in the US within 2023
- Its Q3/2022 revenues improved 59% annually led by strong demand for solar in Europe
- The company forecasts Q4/2022 revenues to range between $855 million to $885 million, with solar contributing $810 million to $840 million
Another thumbs up to US President Joe Biden administration’s Inflation Reduction Act (IRA) with yet another solar company announcing plans to enter US manufacturing within 2023 – and this time it is Israel headquartered solar PV inverter supplier SolarEdge Technologies.
During a call with analysts to discuss its Q3/2022 financials, SolarEdge said it is actively planning a manufacturing facility in the US and is in discussion to select a suitable site. It is open to both contract manufacturing as well as a self-owned fab. The management, however, did not reveal any specific annual capacity for such a plan.
Meanwhile, it reported a healthy Q3/2022 as its production lines recovered from COVID-related events and new manufacturing lines were put in place. “This quarter we increased production and were able to ship more units while increasing our operational efficiency and returning to a growth trajectory for our gross margins,” said SolarEdge CEO Zvi Lando. “We believe that the continued increase in manufacturing capacity in our existing manufacturing lines combined with our plans to establish a manufacturing footprint in the US will allow us to capitalize on the strong demand we are experiencing globally.”
SolarEdge’s revenues for the reporting quarter went up 59% annually to $836.7 million, led by the solar segment bringing in $788.6 million and reflecting an annual increase of 65%, thanks to growing demand in Europe. GAAP gross margin declined over the same period to 26.5%, and for the solar segment it was 28.3%.
While operating expenses went up 30% YoY to $137.6 million, operating income improved 27% to $84.4 million. Nonetheless, its net income of $24.7 million dropped from $53.0 million in Q3/2021 (see SolarEdge Releases Q3/2021 Financial Results).
Financial analyst Jeffrey Osborne of Cowen commented, “Strong operational performance, prior price increases and reduced expedited shipping costs within the quarter more than offset FX headwinds during the quarter, as the company experienced record revenues in Europe and the RoW.”
SolarEdge shipped more than 2.7 GW inverters and optimizers along with 321 MWh of residential batteries.
Philip Shen of Roth Capital Partners believes as the company’s Mexico facility ramps up, it is likely to free up capacity in China and Vietnam to serve Europe.
Guidance
SolarEdge has guided for its Q4/2022 revenues to range between $855 million to $885 million, led by its solar segment that’s to contribute $810 million to $840 million. Non-GAAP gross margin for the quarter will range within 27% to 30%, with that for solar segment between 28% and 31%.
