First Solar Lowers Sales Outlook Despite Strong Q3 Earnings

Leading U.S. solar panel manufacturer First Solar has revised its annual sales forecast downward despite experiencing an increase in third-quarter profits amidst market challenges. This adjustment was announced on Tuesday, following the company reporting a 16.6% rise in net profit for the quarter ending September 30, reaching $313 million, or $2.91 per share. The increase was attributed to high prices resulting from new tariffs on imported solar panels.

The company’s shares fell by 6.9% to $185.99 in after-hours trading. First Solar lowered its full-year sales forecast for 2024 to a range of $4.10 billion to $4.25 billion, down from the previously anticipated range of $4.4 billion to $4.6 billion. This change comes as residential installations faced significant declines throughout the year, and large-scale projects encountered delays in connecting to the electrical grid due to obstacles like extended connection times and a shortage of qualified labor.

Additionally, First Solar reported a sequential decline in quarterly sales due to a decrease in megawatt volume sold. The company’s performance reflects broader challenges faced by the solar energy sector, including the impact of tariffs and operational hurdles that affect project timelines and workforce availability.

The Biden administration's decision in May to impose new tariffs on foreign-made solar modules has ultimately benefited American companies like First Solar that manufacture their products domestically. Despite the positive effect of the tariffs on First Solar's profitability, the adjustment in overall sales forecasts underscores the complexity of the solar energy market environment.