Leading US solar manufacturer First Solar reported its second-quarter earnings in late July, which showed revenue of only $309 million, down $258 million from the previous quarter due to expected lower system and third-party module sales.
First Solar was able to start 2018 off with a bang, with reported sales of $567 million in the first quarter and the promise of beginning production of its new Series 6 modules in April, which was bolstered by the announcement of a new solar manufacturing plant in Perrysburg, Ohio.
“Our first quarter earnings and continued bookings momentum provide a positive start to the year,” said the company’s CEO, Mark Widmar, in May.
“Our earnings for the quarter were supported by the sale of both domestic and international projects, combined with efficient management of core operating expenses. Customer demand for our Series 6 product continues to be strong as evidenced by our year-to-date net bookings of 3.3GWDC.
“We also achieved significant technology milestones this month with the start of Series 6 production in Ohio and the first commercial module shipments to systems projects. We remain focused on leveraging the advantages of our differentiated technology and applying our disciplined operating approach to achieve our near-term and long-term priorities.”
However, the second quarter was less dramatic and in fact saw revenue fall by $258 million to a total of $309 million for the quarter. Cash and marketable securities totaled $3.1 billion, driven primarily by proceeds stemming from the sale of First Solar’s interests in 8point3 Energy Partners but partially offset by ongoing capital investment in its Series 6 manufacturing capacity. First Solar also held $2.7 billion in net cash. So far this year, the company has booked a total of 4.1 gigawatts (GW) and 0.9 GW in the second quarter.
More importantly, from the company’s long-term point of view, Series 6 commercial shipments began from its Malaysia factory during the second quarter.
“We have taken another important step forward in our Series 6 transition with the first commercial shipments from our Malaysia factory,” said Mark Widmar.
“With two factories now producing Series 6 modules and a third factory on the cusp of starting production we have made significant progress during the past quarter. Customer demand for our Series 6 product continues to be solid with nearly 900 megawatts of new contracts signed since our last earnings update. With year-to-date bookings of 4.1GWDC and total contracted volume of 10.9GWDC that extends to the end of 2020, we continue to have good visibility to future demand.”
Earnings per share for the quarter were -$0.46, missing analyst expectations by $0.48 and causing the company’s shares to promptly fall off a cliff. However, in the days since the company’s announcement, its shares have essentially returned to where they started only a few days ago, held in place by the company’s long-term confidence. And while First Solar was forced to update its 2018 guidance “to reflect a narrower expected range of net sales and a decrease in gross margin due to near-term increases in Series 6 module cost per watt,” overall the company sits relatively steady to move forward.