Enphase Energy Inc, a leading provider of energy management solutions, reported a beat in its Q1 earnings but a below-expectations forecast for Q2 revenue, leading to a 9% drop in its shares during extended trading on Tuesday.
Enphase Energy estimates Q2 revenue to be within $700 million to $750 million, which is below analysts’ expected $773 million, according to Refinitiv data. The forecast is the result of a slowdown in battery shipments of 102.4 megawatt hours during the quarter, which fell by 16% compared to last year. However, IQ8 Microinverters, which are used to convert solar power into usable AC power, made up about 65% of all Enphase’s microinverter shipments during the first quarter, which saw a significant increase of 71% from the same quarter last year.
Increase in U.S. Imports of Solar Panels after Months of Gridlock
According to a Reuters report in March, U.S. imports of solar panels have picked up after months of gridlock stemming from the implementation of a new law banning goods made with forced labor. This is a positive development for Enphase Energy, which is well-positioned to take advantage of the increasing demand for solar energy solutions.
Enphase Energy’s Q1 Earnings Beat Expectations
Enphase Energy’s Q1 earnings stood at $1.37 per share, beating the average analysts’ estimate of $1.20 per share. Revenue rose by 65% to $726 million from $441 million a year earlier, primarily due to higher sales in Europe. The company had previously estimated Q1 revenue to be in the range of $700 million to $740 million.
Enphase Energy’s Expansion Plans
The Fremont, California-based company plans to expand its operations further by shipping its microinverters from Romania, starting from Q2 of this year. This move is expected to increase the company’s market share and revenue growth in Europe.
Enphase Energy’s Q1 earnings beat expectations, and the company remains well-positioned to take advantage of the increasing demand for solar energy solutions. However, the Q2 revenue forecast was below expectations due to a slowdown in battery shipments, which will need to be addressed to maintain future growth.