SolarEdge Technologies, Inc. (Nasdaq: SEDG), a global leader in
smart energy technology, today provided selected preliminary
unaudited financial results for the third quarter ended September
30, 2023.
“During the second part of the third quarter of 2023, we
experienced substantial unexpected cancellations and pushouts of
existing backlog from our European distributors,” said Zvi Lando,
Chief Executive Officer of SolarEdge. “We attribute these
cancellations and pushouts to higher than expected inventory in the
channels and slower than expected installation rates. In
particular, installation rates for the third quarter were much
slower at the end of the summer and in September where
traditionally there is a rise in installation rates.”
As a result, third quarter revenue, gross margin and operating
income will be below the low end of the prior guidance range.
Additionally, the Company anticipates significantly lower revenues
in the fourth quarter of 2023 as the inventory destocking process
continues.
“The adjusted guidance is unrelated to the tragic events that
have unfolded in Israel. While there has been some impact on daily
routines at our headquarters, our offices and facilities are open
worldwide, including in Israel, and we are manufacturing and
providing customer support without interruption,” added Lando.
Third quarter revenue is now expected to be in the range of $720
million to $730 million, compared to the previous expectation of
$880 million to $920 million.
GAAP gross margin is now expected to be within the range of 19%
to 20%.
Non-GAAP gross margin* is now expected to be within the range of
20.1% to 21.1%, compared to the previous expectation of 28% to
31%.
GAAP operating loss is now expected to be within the range of $9
million to $28 million.
Non-GAAP operating income* is now expected to be within
the range of $12 million to $31 million, compared to the previous
expectation of $115 million to $135 million.
* Non-GAAP financial measure. See “Non-GAAP Financial Measures”
for additional information on non-GAAP financial measures and a
reconciliation to the most comparable GAAP measures.
Conference Call
The Company will host a conference call to discuss its results
for the third quarter ended September 30, 2023 at 4:30 p.m. ET on
Wednesday, November 1, 2023. The call will be available, live, to
interested parties by dialing 800-343-4136. For international
callers, please dial +1 203-518-9843. The Conference ID is SEDG.
To avoid a delay in connecting to the call, please dial in 10
minutes prior to the start time. A live webcast will also be
available in the Investors Relations section of the Company’s
website at: http://investors.solaredge.com
A replay of the webcast will be available in the Investor
Relations section of the Company’s web site approximately two hours
after the conclusion of the call and will remain available for
approximately 30 calendar days.
About SolarEdge
SolarEdge is a global leader in smart energy technology. By
leveraging world-class engineering capabilities and with a
relentless focus on innovation, SolarEdge creates smart energy
solutions that power our lives and drive future progress. SolarEdge
developed an intelligent inverter solution that changed the way
power is harvested and managed in photovoltaic (PV) systems. The
SolarEdge DC optimized inverter seeks to maximize power generation
while lowering the cost of energy produced by the PV system.
Continuing to advance smart energy, SolarEdge addresses a broad
range of energy market segments through its PV, storage, EV
charging, batteries, electric vehicle powertrains, and grid
services solutions. SolarEdge is online at www.solaredge.com
Cautions Regarding Preliminary Estimates
The foregoing preliminary financial information reflects
management’s current views with respect to the Company’s financial
results. Such preliminary financial information is subject to the
finalization and closing of the accounting books and records of the
Company, which have yet to be fully performed, and should not be
viewed as a substitute for full quarterly financial statements
prepared in accordance with applicable accounting standards. In the
course of preparing and finalizing the Company’s financial
statements for the third quarter ended September 30, 2023, these
preliminary estimates will be subject to change and the Company may
identify items that will require it to make adjustments to such
estimates. For these or other reasons, these preliminary financial
estimates may not ultimately be indicative of the Company’s results
for the third quarter ended September 30, 2023 and actual results
may differ materially from those described above. No independent
registered public accounting firm has reviewed, examined or
performed any procedures with respect to, nor have they expressed
any form of assurance on, these preliminary estimated results.
Use of Non-GAAP Financial Measures
The Company has presented certain non-GAAP financial measures in
this release, such as non-GAAP gross margin and non-GAAP operating
income. Generally, a non-GAAP financial measure is a numerical
measure of a company's performance, financial position, or cash
flows that either exclude or include amounts that are not normally
excluded or included in the most directly comparable measure
calculated and presented in accordance with generally accepted
accounting principles in the United States, or GAAP. Reconciliation
of each non-GAAP financial measure to the most directly comparable
GAAP financial measure can be found in the accompanying tables to
this release. These non-GAAP financial measures do not reflect a
comprehensive system of accounting, differ from GAAP measures with
the same captions and may differ from non-GAAP financial measures
with the same or similar captions that are used by other companies.
As such, these non-GAAP measures should be considered as a
supplement to, and not as a substitute for, or superior to,
financial measures calculated in accordance with GAAP.
The Non-GAAP measures are presented in this press release
because we believe that they provide investors with a means of
evaluating and understanding how the Company’s management evaluates
the company’s operating performance. The non-GAAP financial
measures in this earnings release may differ from similarly titled
measures used by other companies. See “Reconciliation of GAAP to Non-GAAP Financial Measures”
below for reconciliation of relevant GAAP to non-GAAP measures
presented in this release.
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995
This release contains forward looking statements which are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements
include information, among other things, concerning: expectations
as to revenues and inventory in the third and fourth quarters of
2023, our possible or assumed future results of operations; future
demands for solar energy solutions; business strategies; technology
developments; financing and investment plans; dividend policy;
competitive position; industry and regulatory environment; general
economic conditions; potential growth opportunities; and the
effects of competition. These forward-looking statements are often
characterized by the use of words such as “anticipate,” “believe,”
“could,” “seek,” “estimate,” “expect,” “intend,” “may,” “plan,”
“potential,” “predict,” “project,” “should,” “will,” “would” or
similar expressions and the negative or plural of those terms and
other like terminology.
Forward-looking statements are only predictions based on our
current expectations and our projections about future events. These
forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause our actual results,
levels of activity, performance or achievements to be materially
different from those expressed or implied by the forward-looking
statements. Given these factors, you should not place undue
reliance on these forward-looking statements. These factors
include, but are not limited to, the matters discussed in the
section entitled “Risk Factors” of our Annual Report on Form 10-K
for the year ended December 31, 2022, filed on February 22, 2023
and our subsequent quarterly reports filed on Form 10-Q, Current
Reports on Form 8-K and other reports filed with the SEC. All
information set forth in this release is as of October 19, 2023.
The Company undertakes no duty or obligation to update any
forward-looking statements contained in this release, whether as a
result of new information, future events or changes in its
expectations or otherwise, except as may be required by applicable
law, regulation or other competent legal authority.
Reconciliation of GAAP
to Non-GAAP Financial Measures
The following table presents a reconciliation of GAAP gross
margin to non-GAAP gross margin and reconciliation of GAAP
operating income (loss) to non-GAAP operating income (loss) for the
three months ended September 30, 2023.
Reconciliation of GAAP to
non-GAAP Financial Measures
Q3 FY23 Preliminary
Results
Low
High
GAAP gross margin
19.0%
20.0%
Add:
Stock-based compensation expense
0.8%
Acquisition costs and other costs
0.3%
Non-GAAP gross margin
20.1%
21.1%
GAAP operating income (loss) ($
millions)
$(28)
$(9)
Add:
Stock-based compensation expense
$37
Acquisition cost and other costs
$3
Non-GAAP operating income
$12
$31
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231019170033/en/
Investor Contacts SolarEdge Technologies, Inc. JB Lowe,
Head of Investor Relations investors@solaredge.com
Sapphire Investor Relations, LLC Erica Mannion or Michael Funari
investors@solaredge.com
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