SolarEdge Technologies, Inc. (Nasdaq: SEDG), a global leader in
smart energy technology, today announced its financial results for
the second quarter ended June 30, 2022.
Second Quarter 2022 Highlights
- Record revenues of $727.8 million
- Record revenues from solar segment of $687.6 million
- GAAP gross margin of 25.1%
- Non-GAAP gross margin of 26.7%
- Gross margin from solar segment of 28.1%
- GAAP net income of $15.1 million
- Non-GAAP net income of $56.7 million
- GAAP net diluted earnings per share (“EPS”) of $0.26
- Non-GAAP net diluted EPS of $0.95
- 2.52 Gigawatts (AC) of inverters shipped
“The growing demand for energy in general and clean energy in
particular continued to drive top line growth this quarter
resulting in record revenues in Europe and the United States,” said
Zvi Lando, Chief Executive Officer of SolarEdge. “While we continue
to face growing supply chain challenges, some related to our rapid
growth in an environment of component shortages, and macro-economic
trends as a result of our global footprint, we continue to support
our customers while building the infrastructure for sustainable
growth.”
Second Quarter 2022 Summary
The Company reported record revenues of $727.8 million, up 11%
from $655.1 million in the prior quarter and up 52% from $480.1
million in the same quarter last year.
Revenues from the solar segment were record $687.6 million, up
13% from $608.0 million in the prior quarter and up 59% from $431.5
million in the same quarter last year.
GAAP gross margin was 25.1%, down from 27.3% in the prior
quarter and down from 32.5% in the same quarter last year.
Non-GAAP gross margin was 26.7%, down from 28.4% in the prior
quarter and down from 33.9% in the same quarter last year.
Gross margin from the solar segment was 28.1%, down from 30.2%
in the prior quarter and down from 37.4% in the same quarter last
year.
GAAP operating expenses were $146.6 million, up 14% from $128.1
million in the prior quarter and up 46% from $100.6 million in the
same quarter last year.
Non-GAAP operating expenses were $109.6 million, up 11% from
$98.9 million in the prior quarter and up 35% from $81.5 million in
the same quarter last year.
GAAP operating income was $36.0 million, down 29% from $50.9
million in the prior quarter and down 35% from $55.6 million in the
same quarter last year.
Non-GAAP operating income was $84.7 million, down 3% from $87.2
million in the prior quarter and up 4% from $81.3 million in the
same quarter last year.
GAAP net income was $15.1 million, down 54% from $33.1 million
in the prior quarter and down 67% from $45.1 million in the same
quarter last year.
Non-GAAP net income was $56.7 million, down 18% from $68.8
million in the prior quarter and down 22% from $72.5 million in the
same quarter last year.
GAAP net diluted EPS was $0.26, down from $0.60 in the prior
quarter and down from $0.82 in the same quarter last year.
Non-GAAP net diluted EPS was $0.95, down from $1.20 in the prior
quarter and down from $1.28 in the same quarter last year.
Cash flow generated from operating activities was $77.4 million,
compared with $163.0 million used in operating activities in the
prior quarter and $38.7 million generated from operating activities
in the same quarter last year.
As of June 30, 2022, cash, cash equivalents, bank deposits,
restricted bank deposits and marketable securities totaled $973.3
million, net of debt, compared to $979.0 million on March 31,
2022.
Outlook for the Third Quarter 2022
The Company also provides guidance for the third quarter ending
September 30, 2022 as follows:
- Revenues to be within the range of $810 million to $840
million
- Non-GAAP gross margin expected to be within the range of 26% to
29%
- Non-GAAP operating profit to be within the range of $90 million
to $110 million
- Revenues from solar segment to be within the range of $765
million to $795 million
- Gross margin from solar segment expected to be within the range
of 27% to 30%
Conference Call
The Company will host a conference call to discuss these results
at 4:30 p.m. ET on Tuesday, August 2, 2022. The call will be
available, live, to interested parties by dialing 888-394-8218. For
international callers, please dial +1 313-209-6544. The Conference
ID number is 2902967. 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.
Use of Non-GAAP Financial Measures
The Company has presented certain non-GAAP financial measures in
this release, such as non-GAAP net income, non-GAAP net diluted
EPS, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP
operating income and non-GAAP gross margin from sale of solar
products. 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 Company uses these non-GAAP financial measures to analyze
its operating performance and future prospects, develop internal
budgets and financial goals, and to facilitate period-to-period
comparisons. The Company believes that these non-GAAP financial
measures reflect an additional way of viewing aspects of its
operations that, when viewed with its GAAP results, provide a more
complete understanding of factors and trends affecting its
business.
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: 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, 2021, filed on February 22, 2022
and our 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 August 2, 2022. The Company
undertakes no duty or obligation to update any forward-looking
statements contained in this release as a result of new
information, future events or changes in its expectations.
SOLAREDGE TECHNOLOGIES
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME (Unaudited)
(in thousands, except per
share data)
Three Months Ended
June 30,
Six Months Ended
June 30,
2022
2021
2022
2021
Revenues
$
727,774
$
480,057
$
1,382,854
$
885,546
Cost of revenues
545,132
323,865
1,021,254
589,280
Gross profit
182,642
156,192
361,600
296,266
Operating expenses:
Research and development
74,847
52,664
141,196
99,641
Sales and marketing
38,975
29,458
74,291
56,369
General and administrative
28,121
19,370
54,550
39,219
Other operating expenses (income), net
4,687
(859
)
4,687
1,350
Total
operating expenses
146,630
100,633
274,724
196,579
Operating income
36,012
55,559
86,876
99,687
Financial expense, net
(14,311
)
(1,743
)
(19,760
)
(7,840
)
Income before income taxes
21,701
53,816
67,116
91,847
Income taxes
6,617
8,724
18,909
16,679
Net income
$
15,084
$
45,092
$
48,207
$
75,168
SOLAREDGE TECHNOLOGIES
INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS (Unaudited)
(in thousands, except per
share data)
June 30,
2022
December 31,
2021
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
$
745,534
$
530,089
Marketable securities
150,259
167,728
Trade receivables, net of allowances of
$3,805 and $2,626, respectively
669,100
456,339
Inventories, net
470,272
380,143
Prepaid expenses and other current
assets
248,643
176,992
Total current
assets
2,283,808
1,711,291
LONG-TERM ASSETS:
Marketable securities
709,571
482,228
Deferred tax assets, net
33,400
27,572
Property, plant and equipment, net
489,109
410,379
Operating lease right-of-use assets,
net
58,375
47,137
Intangible assets, net
50,372
58,861
Goodwill
116,173
129,629
Other long-term assets
31,970
33,856
Total
long-term assets
1,488,970
1,189,662
Total
assets
$
3,772,778
2,900,953
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Trade payables, net
$
253,399
$
252,068
Employees and payroll accruals
68,154
74,465
Warranty obligations
91,761
71,480
Deferred revenues and customers
advances
30,460
17,789
Accrued expenses and other current
liabilities
168,400
109,379
Total current
liabilities
612,174
525,181
LONG-TERM LIABILITIES:
Convertible senior notes, net
622,991
621,535
Warranty obligations
232,415
193,680
Deferred revenues
170,235
151,556
Finance lease liabilities
46,680
40,508
Operating lease liabilities
42,849
38,912
Other long-term liabilities
17,902
19,542
Total
long-term liabilities
1,133,072
1,065,733
COMMITMENTS AND CONTINGENT LIABILITIES
STOCKHOLDERS’ EQUITY:
Common stock of $0.0001 par value -
Authorized: 125,000,000 shares as of June 30, 2022 and December 31,
2021; issued and outstanding: 55,633,090 and 52,815,395 shares as
of June 30, 2022 and December 31, 2021, respectively
6
5
Additional paid-in capital
1,418,881
687,295
Accumulated other comprehensive loss
(89,620
)
(27,319
)
Retained earnings
698,265
650,058
Total
stockholders’ equity
2,027,532
1,310,039
Total
liabilities and stockholders’ equity
$
3,772,778
$
2,900,953
SOLAREDGE TECHNOLOGIES
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (Unaudited)
(in thousands, except per
share data)
Six Months Ended
June 30,
2022
2021
Cash flows from
operating activities:
Net income
$
48,207
$
75,168
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
Depreciation of property, plant and
equipment
18,861
14,008
Amortization of intangible assets
5,277
4,871
Amortization of debt discount and debt
issuance costs
1,456
1,450
Amortization of premium and accretion of
discount on available-for-sale marketable securities, net
5,376
3,558
Impairment of goodwill and intangible
assets
4,008
—
Stock-based compensation expenses
71,181
47,205
Deferred income taxes, net
(1,092
)
(3,931
)
Loss from sale and disposal of assets
296
2,051
Exchange rate fluctuations and other
items, net
24,666
12,983
Changes in assets and liabilities:
Inventories, net
(93,348
)
13,229
Prepaid expenses and other assets
(79,215
)
(20,356
)
Trade receivables, net
(235,316
)
(128,564
)
Trade payables, net
(7,339
)
(20,120
)
Employees and payroll accruals
5,202
9,734
Warranty obligations
59,588
27,298
Deferred revenues and customers
advances
32,277
4,524
Other liabilities, net
54,341
19,660
Net cash provided by (used in) operating
activities
(85,574
)
62,768
Cash flows from
investing activities:
Proceed from sales and maturities of
available-for-sale marketable securities
126,287
103,763
Purchase of property, plant and
equipment
(91,884
)
(65,267
)
Investment in available-for-sale
marketable securities
(362,119
)
(422,470
)
Withdrawal from bank deposits, net
—
46,534
Other investing activities
1,783
1,442
Net cash used in investing activities
$
(325,933
)
$
(335,998
)
Cash flows from
financing activities:
Proceeds from secondary public offering,
net of issuance costs
$
650,526
$
—
Repayment of bank loans
—
(16,385
)
Proceeds from exercise of stock-based
awards
1,642
5,472
Tax withholding in connection with
stock-based awards, net
(2,318
)
(9,668
)
Other financing activities
(1,444
)
(625
)
Net cash provided by (used in) financing
activities
648,406
(21,206
)
Increase (decrease) in cash and cash
equivalents
236,899
(294,436
)
Cash and cash equivalents at the beginning
of the period
530,089
827,146
Effect of exchange rate differences on
cash and cash equivalents
(21,454
)
(8,598
)
Cash and cash equivalents at the end of
the period
$
745,534
$
524,112
SOLAREDGE TECHNOLOGIES
INC.
RECONCILIATION OF NON-GAAP
FINANCIAL MEASURES (Unaudited)
(in thousands, except per share
data and percentages)
Reconciliation of GAAP to
Non-GAAP
Three months ended
Six Months Ended
June 30,
2022
March 31,
2022
June 30,
2021
June 30,
2022
June 30,
2021
Gross profit (GAAP)
182,642
178,958
156,192
361,600
296,266
Revenues from finance component
(146)
(135)
(99)
(281)
(185)
Stock-based compensation
5,285
5,062
4,291
10,347
10,081
Disposal of assets related to Critical
Power
4,314
—
—
4,314
—
Amortization and depreciation of acquired
assets
2,185
2,219
2,401
4,404
4,713
Gross profit (Non-GAAP)
194,280
186,104
162,785
380,384
310,875
Gross margin (GAAP)
25.1%
27.3%
32.5%
26.1%
33.5%
Revenues from finance component
0.0%
0.0%
0.0%
0.0%
0.0%
Stock-based compensation
0.7%
0.8%
0.9%
0.7%
1.1%
Disposal of assets related to Critical
Power
0.6%
—%
—%
0.3%
—%
Amortization and depreciation of acquired
assets
0.3%
0.3%
0.5%
0.3%
0.5%
Gross margin (Non-GAAP)
26.7%
28.4%
33.9%
27.5%
35.1%
Operating expenses (GAAP)
146,630
128,094
100,633
274,724
196,579
Stock-based compensation - R&D
(16,819)
(14,985)
(9,805)
(31,804)
(18,603)
Stock-based compensation - S&M
(7,047)
(6,701)
(5,780)
(13,748)
(11,215)
Stock-based compensation - G&A
(7,923)
(7,359)
(4,176)
(15,282)
(7,306)
Amortization and depreciation of acquired
assets - R&D
(300)
(303)
(9)
(603)
(21)
Amortization and depreciation of acquired
assets - S&M
(226)
(236)
(236)
(462)
(473)
Amortization and depreciation of acquired
assets - G&A
(5)
(6)
(7)
(11)
(15)
Gain (loss) from assets sales and
disposal
(8)
410
—
402
62
Other operating income (expenses)
(4,687)
—
859
(4,687)
(1,350)
Operating expenses (Non-GAAP)
109,615
98,914
81,479
208,529
157,658
Operating income (GAAP)
36,012
50,864
55,559
86,876
99,687
Revenues from finance component
(146)
(135)
(99)
(281)
(185)
Disposal of assets related to Critical
Power
4,314
—
—
4,314
—
Stock-based compensation
37,074
34,107
24,052
71,181
47,205
Amortization and depreciation of acquired
assets
2,716
2,764
2,653
5,480
5,222
Loss (gain) from assets sales and
disposal
8
(410)
—
(402)
(62)
Other operating (income) expenses
4,687
—
(859)
4,687
1,350
Operating income (Non-GAAP)
84,665
87,190
81,306
171,855
153,217
SOLAREDGE TECHNOLOGIES
INC.
RECONCILIATION OF NON-GAAP
FINANCIAL MEASURES (Unaudited)
(in thousands, except per share
data and percentages)
Reconciliation of GAAP to
non-GAAP
Three months ended
Six Months Ended
June 30,
2022
March 31,
2022
June 30,
2021
June 30,
2022
June 30,
2021
Financial income (expense), net
(GAAP)
(14,311)
(5,449)
(1,743)
(19,760)
(7,840)
Notes due 2025
728
728
726
1,456
1,450
Non cash interest
1,699
1,609
1,439
3,308
2,775
Currency fluctuation related to lease
standard
(9,028)
(1,792)
1,300
(10,820)
(989)
Financial income (expense), net
(non-GAAP)
(20,912)
(4,904)
1,722
(25,816)
(4,604)
Income tax benefit (expense)
(GAAP)
(6,617)
(12,292)
(8,724)
(18,909)
(16,679)
Deferred taxes
(389)
(1,201)
(1,789)
(1,590)
(3,930)
Income tax benefit (expense)
(Non-GAAP)
(7,006)
(13,493)
(10,513)
(20,499)
(20,609)
Net income (GAAP)
15,084
33,123
45,092
48,207
75,168
Revenues from finance component
(146)
(135)
(99)
(281)
(185)
Disposal of assets related to Critical
Power
4,314
—
—
4,314
—
Stock-based compensation
37,074
34,107
24,052
71,181
47,205
Amortization and depreciation of acquired
assets
2,716
2,764
2,653
5,480
5,222
Loss (gain) from assets sales and
disposal
8
(410)
—
(402)
(62)
Other operating (income) expenses
4,687
—
(859)
4,687
1,350
Notes due 2025
728
728
726
1,456
1,450
Non cash interest
1,699
1,609
1,439
3,308
2,775
Currency fluctuation related to lease
standard
(9,028)
(1,792)
1,300
(10,820)
(989)
Deferred taxes
(389)
(1,201)
(1,789)
(1,590)
(3,930)
Net income (Non-GAAP)
56,747
68,793
72,515
125,540
128,004
SOLAREDGE TECHNOLOGIES
INC.
RECONCILIATION OF NON-GAAP
FINANCIAL MEASURES (Unaudited)
(in thousands, except per share
data and percentages)
Reconciliation of GAAP to
non-GAAP
Three months ended
Six Months Ended
June 30,
2022
March 31,
2022
June 30,
2021
June 30,
2022
June 30,
2021
Net basic earnings per share
(GAAP)
0.27
0.62
0.87
0.89
1.45
Revenues from finance component
0.00
0.00
(0.01)
(0.01)
(0.01)
Disposal of assets related to Critical
Power
0.08
—
—
0.08
—
Stock-based compensation
0.67
0.64
0.47
1.31
0.91
Amortization and depreciation of acquired
assets
0.04
0.05
0.05
0.10
0.10
Loss (gain) from assets sales and
disposal
0.00
0.00
—
0.00
0.00
Other operating (income) expenses
0.09
—
(0.02)
0.08
0.03
Notes due 2025
0.01
0.01
0.01
0.03
0.03
Non cash interest
0.03
0.03
0.03
0.06
0.05
Currency fluctuation related to lease
standard
(0.16)
(0.03)
0.03
(0.20)
(0.02)
Deferred taxes
(0.01)
(0.03)
(0.04)
(0.03)
(0.07)
Net basic earnings per share
(Non-GAAP)
1.02
1.29
1.39
2.31
2.47
Net diluted earnings per share
(GAAP)
0.26
0.60
0.82
0.86
1.36
Revenues from finance component
0.00
0.00
(0.01)
(0.01)
0.00
Disposal of assets related to Critical
Power
0.08
—
—
0.08
—
Stock-based compensation
0.62
0.58
0.42
1.20
0.81
Amortization and depreciation of acquired
assets
0.04
0.05
0.04
0.10
0.09
Loss (gain) from assets sales and
disposal
0.00
(0.01)
—
(0.01)
0.00
Other operating (income) expenses
0.08
—
(0.01)
0.08
0.03
Notes due 2025
0.00
0.01
0.00
0.01
0.00
Non cash interest
0.03
0.02
0.03
0.05
0.05
Currency fluctuation related to lease
standard
(0.15)
(0.03)
0.02
(0.18)
(0.01)
Deferred taxes
(0.01)
(0.02)
(0.03)
(0.03)
(0.07)
Net diluted earnings per share
(Non-GAAP)
0.95
1.20
1.28
2.15
2.26
Number of shares used in computing net
diluted earnings per share (GAAP)
58,564,734
56,315,193
55,930,562
57,446,416
55,965,369
Stock-based compensation
904,781
927,219
780,309
916,000
773,248
Number of shares used in computing net
diluted earnings per share (Non-GAAP)
59,469,515
57,242,412
56,710,871
58,362,416
56,738,617
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220802005981/en/
Investor Contacts SolarEdge Technologies, Inc. Ronen
Faier, Chief Financial Officer +1 510-498-3263
investors@solaredge.com
Sapphire Investor Relations, LLC Erica Mannion or Michael Funari
+1 617-542-6180 investors@solaredge.com
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SolarEdge Technologies (NASDAQ:SEDG)
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From Jul 2023 to Jul 2024