By SunRun Inc. experienced a setback in extended trading as it reported fourth-quarter results that fell short of expectations, reflecting the challenges faced by the solar industry amid concerns about weakening demand.
Financial Performance
The residential solar-power installer and energy-storage provider disclosed a fourth-quarter net loss of $535.4 million, or $1.60 per share, a substantial increase from the $327.9 million loss — with a per-share profit of 29 cents — in the same quarter of the previous year. Surpassing FactSet’s forecast of 21 cents per share, the company’s fourth-quarter loss for last year disappointed investors.
Revenue also decreased to $516.6 million from $609.2 million in the prior-year quarter, missing analysts’ estimated sales of $532.7 million surveyed by FactSet.
Strategic Shifts
In an effort to navigate the challenging landscape, SunRun’s Chief Executive Mary Powell emphasized the company’s focus on selling higher-margin storage options and providing additional incentives like early renewals and expanding capacity in existing storage systems. Despite the hurdles, Powell remains optimistic about the company’s outlook for future installations.
Industry Challenges
Mounting difficulties in borrowing money due to higher interest rates have hindered SunRun’s progress in advancing solar installations. Compounded by reduced incentives for rooftop solar usage in California, a key market for solar energy, the company faces additional headwinds.
Industry-Wide Impact
The ripple effects of the industry’s challenges were also felt by SolarEdge Technologies Inc., a solar-power equipment manufacturer, which reported a significant decline in quarterly sales and projected weaker sales moving forward. The company recently announced layoffs affecting about 16% of its workforce.
In response to these industry headwinds, SunRun’s shares dropped by 10% in after-hours trading, while SolarEdge Technologies Inc. saw a 12.2% decline during regular trading hours on Wednesday.
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