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SolarEdge (SEDG) Q2 Earnings Beat Estimates, Revenues Rise

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SolarEdge Technologies, Inc.’s (SEDG - Free Report) share price declined 19.1% since its earnings release on Aug 2, 2022.  It reported second-quarter adjusted earnings of 95 cents per share. The bottom line declined by 25.8% from the prior-year quarter’s earnings of $1.28 per share.

The Zacks Consensus Estimate for the second quarter was pegged at 86 cents per share.

Barring one-time adjustments, the company posted GAAP earnings of 26 cents per share compared with 82 cents in the year-ago quarter.

Revenues

SolarEdge’s revenues of $727.8 million in the second quarter surpassed the Zacks Consensus Estimate of $726 million by almost a cent. The top line surged 52% from the year-ago quarter’s $480.1 million.

Revenues from the solar segment were $687.6 million, up 59% from $431.5 million in the prior-year quarter.

Operational Highlights

SolarEdge shipped a total of 2.52 gigawatts (GW) of inverters in the reported quarter.

The adjusted gross margin contracted by 720 basis points from the prior-year gross margin of 33.9% to 26.7%.

Adjusted operating expenses went up 35% year over year to $109.6 million.

The adjusted operating income in the quarter totaled $84.7 million, up 4% from the year-ago quarter’s $81.3 million.

Financial Performance

SolarEdge had $745.5 million of cash and cash equivalents as of Jun 30, 2022, up from $530.1 million as of Dec 31, 2021.

The cash outflow from operating activities amounted to $85.6 million during the six months ended Jun 30, 2022 against the cash inflow from operating activities of $62.8 million in the year-ago period.

Total long-term liabilities were $1,133.1 million as of Jun 30, 2022 compared with $1,065.7 million as of Dec 31, 2021.

Q3 Guidance

In the third quarter of 2022, SEDG expects revenues in the range of $810-$840 million. The Zacks Consensus Estimate for the same is pegged at $816.4 million, lower than the midpoint of the guided range.

Revenues from the solar segment in the second quarter are projected in the range of $765-$795 million.

While the company’s adjusted gross margin is estimated at 26-29%, the gross margin in the solar segment is anticipated at 27-30%.

Zacks Rank

SolarEdge currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Solar Releases

Enphase Energy, Inc. (ENPH - Free Report) reported second-quarter 2022 adjusted earnings of $1.07 per share, which improved by a solid 101.9% from the 53 cents reported in the prior-year quarter.

Enphase Energy’s second-quarter revenues of $530.2 million beat the Zacks Consensus Estimate of $507 million by 4.7%. For the third quarter of 2022, ENPH expects revenues in the range of $590-$630 million.

First Solar, Inc. (FSLR - Free Report) reported second-quarter 2022 earnings of 52 cents per share, which beat the Zacks Consensus Estimate of 30 cents by 73.3%. However, the bottom line declined from the prior-year quarter’s earnings of 77 cents per share.

First Solar’s second-quarter sales were $621 million, which beat the Zacks Consensus Estimate of $599 million by 3.7%. First Solar forecast shipments in the band of 8.9-9.4 GW in 2022.

SunPower Corporation (SPWR - Free Report) reported second-quarter 2022 adjusted earnings of 3 cents per share, which declined 57.1% from the year-ago period.

During the quarter under review, SunPower’s adjusted revenues came in at $414.1 million. SunPower had cash and cash equivalents of $206.4 million as of Jul 3, 2022.