SolarEdge returns to revenue growth in Q1 FY 2017


SolarEdge, the Israel-headquartered manufacturer of power optimizers and solar inverters, has managed to stem a slight contraction in revenue recorded in the final quarter of its fiscal year 2016 and post increased revenue for the quarter ended September 30.

The company follows a unique financial year that ends June 30, meaning this latest quarterly update is in fact its Q1 FY 2017 performance. In isolation, SolarEdge’s revenue of $128.5 million for the quarter looks strong, but in order to understand the firm’s performance that figure must be put into context.

Contrasted against the same period last year it is a sizable improvement on the $115 million in revenue registered in Q1 FY 2016, and was also up 3% on Q4 FY 2016, which saw revenue reach $124.8 million.

In fact, this sequential increase has bucked a minor blip in SolarEdge’s revenue recorded in that last quarter of 0.4% against Q3 FY 2016, and looks to have arrested the downward turn with which the company ended the last financial year.

Inverter shipments for this latest quarter reached 466 MW (AC), which is an increase on the 427 MW shipped in Q4 FY 2016, and there were also sequential increases in operating income ($18.2 million in this most recent quarter as compared to $17.9 million in the previous quarter) and GAAP gross margin, which grew 31.4% sequentially (29.1% year-on-year) to reach 32.6%.

Net income of $15.6 million was, however, down on the previous quarter’s $17.3 million due to tighter price pressures in the inverter industry, but that figure was still up year-on-year, besting the $14.4 million recorded in Q1 FY 2016.

SolarEdge was also able to increase its cash and cash equivalents strongly, ending the quarter with a total of $206.7 million compared to $186-6 million on June 30 2016.

"The solar market is facing challenging times," said SolarEdge CEO, chairman and founder Guy Sella. "Despite this, our financial parameters continue to be strong and we are confident in our strategy. We are focused on maintaining and growing our market share by adjusting our plans to the changing environment and continuing to invest in R&D for new innovative products and diligent cost reduction, while improving efficiency and increasing geographic diversification."

This caution was evident in the firm’s guidance for the quarter ended December 31 2016, which projects SolarEdge to register revenues within the $110 million to $120 million range.