California-headquartered Enphase Energy, which specializes in microinverters and home storage units, has announced that it is to reduce its global workforce by around 11% as the company embarks on a restructuring and cost saving initiative in the third and fourth quarters.
The firm, which endured a challenging 2015 and posted a net loss of $16.7 million in Q2, has been seeking ways to lower its overheads for many quarters, but has thus far resisted the urge to trim its workforce, instead focusing on cost-reduction drives and the launch of new products, namely its AC home battery that was recently rolled out in Australia and New Zealand.
However, the challenging price pressures inherent in the global inverter and module level power electronics (MLPE) space have evidently taken their toll on Enphase, which is now taking measures to lower its annualized operating expenses by $20 million.
Further details of the restructuring process also include the elimination of certain non-core projects, and these actions are expected to see the company incur aggregate restructuring charges of $3 million in Q3, and around $1.3 million in non-cash expenses and write-offs related to property and equipment.
All restructuring efforts are scheduled to be completed before the end of the year.
"We made these decisions as part of our efforts to increase our competitiveness in an environment where industry dynamics are constantly evolving," said Enphase Energy CEO and president, Paul Nahi. "We believe these restructuring actions will better align Enphases resources with our long-term competitive growth strategies and market opportunities. I would like to express my sincere gratitude to those employees affected [by todays announcement]."
Enphase also adjusted its Q3 and Q4 guidance on the back of the restructuring announcement. Revenue for Q3 is still projected to be within the range of $87 to $93 million as previously stated, but GAAP operating expenses are expected to increase as a result of the restructuring charges.
Revenue for Q4 is projected to be somewhere between $90 to $100 million, the company added.