SolarEdge turns to Q3 loss hurt by high inventory

SolarEdge's Sella 2 battery cell factory in South Korea. Image by: SolarEdge.

Israel-based photovoltaic (PV) inverters and batteries supplier SolarEdge Technologies Inc (NASDAQ:SEDG) booked a third-quarter net loss of USD 61.2 million (EUR 57.7m), reflecting the weak market conditions and high inventory levels.

In the year-ago period, SolarEdge registered a net profit of USD 24.7 million. The company explained on Wednesday that its deteriorated performance mostly stems from the increased inventory of its products in the distribution channels, in Europe in particular.

On an adjusted basis, the Israeli firm’s net loss in July-September stood at USD 31 million, against a profit of USD 157.4 million in the previous quarter. At USD 725.3 million, revenues slipped by 13% in annual terms, with revenues from the solar segment declining by 14% to USD 676.4 million.

Amounts in USD	Q3 2023	Q3 2022
Revenues	725.3m	836.7m
GAAP operating profit (loss)	(16.7m)	84.4m
GAAP gross margin	19.7%	26.5%
Total operating expenses	159.5m	137.6m
GAAP net profit (loss)	(61.2m)	24.7m
Non-GAAP net profit (loss)	(31m)	54.1m

In October, the company warned that its third-quarter earnings and revenue would be below the low end of its guidance due to unexpected order cancellations.

“While channel inventory clearing is expected to continue in coming quarters, we are optimistic about the future of the solar PV industry,” said CEO Zvi Lando.

During the reporting period, the company shipped 3.8 GW of solar inverters and 121 MWh of batteries.

(USD 1.0 = EUR 0.943)

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