(Reuters) – SolarEdge Technologies (NASDAQ:) on Wednesday forecast fourth-quarter revenue below Wall Street estimates on weak demand for its solar inverters, sending the company’s shares down 22.3% in extended trade.
Growth for solar in Europe has slowed due to excess inventories and weakening demand in key markets as fossil fuel prices have scaled back from record highs reached last year.
While in the United States, higher interest rates and a metering reform in California, the country’s largest solar market, have dented demand for solar.
The company, whose market capitalization has dropped more than half this year, forecast current-quarter revenue between $300 million to $350 million, far below analysts’ estimates of $687.9 million, as per LSEG data.
SolarEdge had trimmed its third-quarter revenue expectations last month due to high inventories and a slowdown in installation which led to substantial cancellations and backlog clearing from its European distributors in the quarter.
The renewable energy firm also reported an adjusted net loss of 55 cents per share for the quarter ended Sept. 30, compared to analysts’ expectations of a profit of 89 cents per share.
“The results for the third quarter fell short of our prior expectations and are reflecting a slow market environment,” said CEO Zvi Lando.
Quarterly revenue of $725.3 million also came in below estimates of $768.38 million.
SolarEdge forecast adjusted gross margin in the range of 5% to 8% for the fourth quarter.
Peer Enphase had also forecast a weak fourth- quarter revenue.
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