As the maker of the highest-efficiency crystalline silicon PV modules available on the market, SunPower has a lot of positive things to say about its business. Q4 was no exception, with the company reporting a whopping $1.02 billion in revenue, 2 1/2 times greater than a year ago, on top of strong progress in both the residential and commercial markets.
But despite this and the sale of around 400 MW of utility-scale projects, there was one unavoidable number: the company’s net loss of $275 million.
Much of this loss stems from restructuring, which includes SunPower’s decision late last year to close its cell and module production in the Philippines and shift production to Mexico, along with with two rounds of massive layoffs announced in August and December. All told restructuring charges totaled $176 million during Q4, but but the need for these layoffs and the simple fact of $100 million in quarterly losses not related to restructuring points to a deeper problem.
SunPower simply hasn’t been profitable for a long time, and has reported losses on a GAAP basis for at least the last six quarters. Over the full year 2016 the company brought in $2.56 billion in revenue, but reported a -18% operating margin and an operating loss of $462 million.
Despite this hemorrhaging of red ink, SunPower managed an operating cash flow of $485 million in Q4, which it used to pay off a similar amount of debt and thus de-leverage its balance sheet.
And in terms of operational results, SunPower continues to report success. The company’s complete solutions are also gaining traction, its Equinox solution representing 2/3 of new residential orders during Q4, and its Helix solution making up over 90% of commercial bookings.
In terms of technical progress, SunPower is likewise strong. The company’s Fab 4 is producing cells with an average efficiency of 25%, above what was previously considered the limit for this kind of crystalline silicon technology, and SunPower expects its lower-cost P-series production to above 400 MW by the end of 2017.
SunPower says that it is putting an “intense” focus on module and balance of system cost reduction programs, as the company faces pressures due to crushing low global module prices as well as low power contract prices. SunPower claims an 850 MW portfolio in Latin America, which has seen the world’s lowest contracted prices for solar to date.
The company predicts a “challenging” 2017. In the first quarter SunPower expects to bring in $315 to $365 million, with losses of $150-175 million. Over the full year the company expects revenue to fall to $1.8-$2.3 billion, and while it did not provide a GAAP net income prediction, it predicts a positive cash flow.
SunPower expects its financials to improve in 2018. The company has the active backing of majority shareholder Total, and points to its positive cash flow and liquidity as key metrics for the “near term”.
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