First Solar lowers revenue and capital expenditure target

First Solar has revised its 2024 guidance reflecting a more cautious outlook for key financial metrics such as revenue, gross margin, operating income, and capital expenditures.

This revision signals a challenging year ahead for the company, likely influenced by market pressures, operational adjustments, and potentially increased competition or cost pressures. Here is a breakdown and analysis of the changes.

First Solar has lowered its sales guidance to $4.1 billion – $4.25 billion in 2024 from the previous estimate of $4.4 billion – $4.6 billion.

First Solar is expecting gross margin of $1.95 billion – $2 billion from the earliest forecast of $2 billion –  $2.1 billion.

First Solar has also reduced its operating expenses to $445 million – $475 million from the previous guidance of $455 million – $485 million.

First Solar is expecting operating income of $1.48 billion – $1.54 billion against $1.5 billion – $1.6 billion.

First Solar has lowered its estimate of capital expenditures to $1.55 billion to $1.65 billion from $1.8 billion – $2 billion.

First Solar has lowered its estimate on volume to 14.2GW – 14.6GW from 15.6GW – 16.3GW.

First Solar has reported sales of $0.9 billion for third-quarter of 2024, a decrease of $0.1 billion from Q2. The decline was due to lower MW volume sold and a product warranty reserve charge, partially offset by termination payments from customers in the U.S. and India.

Reported earnings per diluted share were $2.91, down from $3.25 in Q2, reflecting lower sales and the impact of warranty-related expenses.

CEO Mark Widmar emphasized First Solar’s resilience amid industry and political volatility, noting a continued focus on balancing growth, profitability, and liquidity.

Baburajan Kizhakedath