First Solar hits legal headwinds as shareholders file tariff-related class action

First Solar, Inc. is facing a federal securities class action lawsuit following allegations that the company misled investors regarding its ability to navigate changing U.S. tariff policies and global manufacturing constraints.

The lawsuit, filed by Pomerantz LLP in the U.S. District Court for the Eastern District of New York under docket 26-cv-03787, represents a class of investors who acquired First Solar securities between February 26, 2025, and February 24, 2026.

Multiple investor-rights firms, including Robbins Geller Rudman & Dowd LLP and Faruqi & Faruqi, LLP, have issued parallel alerts for shareholders to join the litigation ahead of an August 24, 2026, lead plaintiff deadline.

Sourcing and tariff pressures trigger disclosure claims 

The core of the legal complaints centers on how the Tempe, Arizona-based manufacturer communicated its operational resilience during a period of shifting trade regulations. According to the filings, First Solar allegedly overstated its capacity to manage the operational and financial impacts of U.S. tariff policies on its business.

Specifically, the litigation focuses on the fallout from the broad reciprocal tariffs enacted by the Trump administration in April 2025, which initially slapped 24% and 46% import duties on goods from Malaysia and Vietnam before later being adjusted down to 10%. Because First Solar manufactures a significant portion of its Series 6 modules at major hubs in Malaysia and Vietnam, these tariffs hit its international production lines head-on.

The lawsuits allege that First Solar falsely reassured investors that module prices in its core U.S. market remained stable while understating the severe financial damage of idling those Southeast Asian facilities, which reportedly dropped to around 20% capacity utilization.

The complaints claim the company downplayed the costs of underutilization alongside the complexities of shifting production to a new U.S. finishing facility in South Carolina, rendering its public statements and financial projections materially misleading.

Downgrades and earnings misses pull down stock price

The legal push follows two key market disclosures that significantly impacted First Solar’s valuation:

• January 7, 2026: Financial services firm Jefferies downgraded First Solar from Buy to Hold, noting that the company had lowered guidance, faced significant de-bookings, and experienced margin compression throughout 2025. The downgrade flagged that international facilities remained a financial pain point under active tariffs and that underutilization would limit 2026 deployment opportunities. On this news, First Solar’s stock price fell $27.67 per share, or 10.29%, to close at $241.11 per share. 
• February 24, 2026: First Solar released its fourth-quarter and full-year 2025 financial results, missing consensus earnings expectations by a wide margin and setting revenue guidance for 2026 below Wall Street estimates. The company cited customer headwinds such as permitting delays under the Trump administration. Following the announcement, Baird Research downgraded the stock to Neutral from Outperform, pointing to several question marks in the forward outlook. The next day, the stock fell an additional $33.09 per share, or 13.61%, to close at $210.12 per share on February 25, 2026.

The plaintiff firms are seeking unspecified damages under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 to recover losses incurred by investors during the year-long class period. First Solar has not yet issued a formal response to the newly filed litigation.

Moving forward, the next benchmark for the litigation will be the court’s appointment of a lead plaintiff following the August 24 deadline, which will dictate how the discovery phase shapes up against the domestic manufacturer.