US solar panel manufacturer SunPower revealed a strong Q3 despite a lack of revenue growth and a net loss.
These may sound like contradictory statements, but SunPower is currently in the midst of moving towards a different financial model that focuses more on retaining assets rather than selling them — subsequently impacting the quarterly revenues and overall net income/loss.
Specifically, SunPower is gearing up to drop a number of projects down to its new yieldco, 8point3 Energy Parnters. According to SunPower president and CEO Tom Werner, SunPower has already handed over the 135 MW Quinty solar project — which is on track to be recognized as non-GAAP revenue in the fourth quarter. In addition, SunPower completed work on the 8 MW Riverside Public Utilities project as well as the 12 MW Roc du Doun power plant in France, and 40 MW worth of projects developed for Apple in China.
SunPower was also awarded a 20 MW project for Sulphur Springs Valley Electric Cooperative in Arizona, which is scheduled for delivery in 2016.
In the third quarter, SunPower recorded GAAP revenue of $380.2 million — steady with the $381 million they took in during Q2’15, but well below the third quarter of 2014, which under their old model of selling rather than holding assets, the company took in $662.7 million. The company also recorded a net loss of $56.3 million for the quarter, well down on the $6.5 million net income from Q2’15, and obviously even further down on Q3’14’s $32 million.
“Our strong quarterly results reflect the continued success of our customer first, complete solution strategy as we executed well on our project commitments and exceeded our key financial targets for the quarter,” said Tom Werner. “Operationally, we met our cell and balance of systems cost targets and shipments of our industry leading technology now exceed one million cells per day. With Fab 4 scheduled for large volume production next year, we believe we will have the capacity to meet customer demand for our high efficiency, high quality solutions.”
SunPower also provided GAAP guidance for the following fourth quarter of revenue between $300 million and $350 million, a gross margin of between 5% and 6%, and a total of between 275 MW and 305 MW deployed for the quarter.
For the fiscal year 2015 SunPower is expecting GAAP revenue of between $1.50 billion and $1.55 billion and a gross margin of between 15% and 16%.
“The solid execution of our downstream strategy enabled us to post strong financial results for the quarter, including generating $54 million in EBITDA,” added Chuck Boynton, SunPower CFO. “In relation to working capital, we increased inventory in the third quarter in preparation to meet our significant 2016 backlog while adding assets to our holdco asset base. With solid industry fundamentals, a diversified end channel strategy, new product introductions, and further commitment to our manufacturing cost reduction roadmaps, we are well positioned for profitable growth in 2016.”