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SunPower (SPWR) Q2 Loss Wider than Expected, Offers View
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SunPower Corp. reported second-quarter 2016 adjusted loss of 33 cents per share, wider than the Zacks Consensus Estimate of a loss of 31 cents by 6.5%. In the year-ago quarter, the company had reported earnings of 9 cents.
Adjustments were related to the sale of projects to 8point3 Energy Partners – a holding company formed in 2015 with First Solar (FSLR - Free Report) , sale of operating lease assets, revenues from utility and power plant projects, stock-based compensation, sale-leaseback transactions, tax effect, and other adjustment costs.
On a GAAP basis, the company incurred a loss of 51 cents per share. In the year-ago quarter, it had reported earnings of 4 cents.
Operational Results
During the quarter, SunPower generated revenues of $401.8 million, surpassing the Zacks Consensus Estimate of $341 million by 17.8%. Reported revenues also grew 6.7% from the year-ago figure of $376.7 million.
The company’s gross margin contracted 450 basis points (bps) to 13.1% from 17.6% in the prior-year quarter. Total operating expenses were up 11.9% to $116.2 million owing to higher research and development expenses (52.8%), and selling, general and administrative expenses (3.9%).
SunPower had cash and cash equivalents of $590.1 million, as of Jul 3, 2016, compared with $954.5 million as of Jan 3, 2016. Long-term debt increased to $578.2 million from $478.9 million at 2015 end.
In the second quarter, net cash outflow was $300.1 million from operating activities, compared to outflow of $212.0 million in the year-ago period.
Guidance
On a non-GAAP basis, the company expects revenues in the range of $750–$850 million for the third quarter of 2016 and $3.0–$3.2 billion for the full year. Gross margin is estimated to be 16.5–18.5% for the third quarter and 10.5–12.5% for the full year.
SunPower expects to deploy 380–420 megawatts (“MW”) in the third quarter and 1,450–1,650 MW in 2016.
A Peer Release
SolarCity Corp. , the largest U.S. rooftop solar installer, posted an adjusted loss of $2.32 per share in the second quarter of 2016, narrower than the Zacks Consensus Estimate of a loss of $2.43. However, the quarterly figure was much wider than the year-ago loss of $1.61 per share. The wider loss can be attributed to the company’s rising expenses.
Zacks Rank
Currently, SunPower has a Zacks Rank #4 (Sell).
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SunPower (SPWR) Q2 Loss Wider than Expected, Offers View
SunPower Corp. reported second-quarter 2016 adjusted loss of 33 cents per share, wider than the Zacks Consensus Estimate of a loss of 31 cents by 6.5%. In the year-ago quarter, the company had reported earnings of 9 cents.
Adjustments were related to the sale of projects to 8point3 Energy Partners – a holding company formed in 2015 with First Solar (FSLR - Free Report) , sale of operating lease assets, revenues from utility and power plant projects, stock-based compensation, sale-leaseback transactions, tax effect, and other adjustment costs.
On a GAAP basis, the company incurred a loss of 51 cents per share. In the year-ago quarter, it had reported earnings of 4 cents.
Operational Results
During the quarter, SunPower generated revenues of $401.8 million, surpassing the Zacks Consensus Estimate of $341 million by 17.8%. Reported revenues also grew 6.7% from the year-ago figure of $376.7 million.
The company’s gross margin contracted 450 basis points (bps) to 13.1% from 17.6% in the prior-year quarter. Total operating expenses were up 11.9% to $116.2 million owing to higher research and development expenses (52.8%), and selling, general and administrative expenses (3.9%).
SUNPOWER CORP-A Price, Consensus and EPS Surprise
SUNPOWER CORP-A Price, Consensus and EPS Surprise | SUNPOWER CORP-A Quote
Financial Position
SunPower had cash and cash equivalents of $590.1 million, as of Jul 3, 2016, compared with $954.5 million as of Jan 3, 2016. Long-term debt increased to $578.2 million from $478.9 million at 2015 end.
In the second quarter, net cash outflow was $300.1 million from operating activities, compared to outflow of $212.0 million in the year-ago period.
Guidance
On a non-GAAP basis, the company expects revenues in the range of $750–$850 million for the third quarter of 2016 and $3.0–$3.2 billion for the full year. Gross margin is estimated to be 16.5–18.5% for the third quarter and 10.5–12.5% for the full year.
SunPower expects to deploy 380–420 megawatts (“MW”) in the third quarter and 1,450–1,650 MW in 2016.
A Peer Release
SolarCity Corp. , the largest U.S. rooftop solar installer, posted an adjusted loss of $2.32 per share in the second quarter of 2016, narrower than the Zacks Consensus Estimate of a loss of $2.43. However, the quarterly figure was much wider than the year-ago loss of $1.61 per share. The wider loss can be attributed to the company’s rising expenses.
Zacks Rank
Currently, SunPower has a Zacks Rank #4 (Sell).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>