First Solar Reports Mixed Q4 Results: Revenue Exceeds Expectations, EPS Falls Short

First Solar reported its financial results for the fourth quarter, highlighting a strong performance in sales while facing challenges with earnings per share (EPS). The company achieved revenue of $1.5 billion, which surpassed analyst estimates of $1.48 billion.

However, the EPS for the quarter came in at $3.65, missing the expected $4.63. This mixed performance reveals both growth in sales and ongoing difficulties in maintaining profitability.

Metric	Q4 2024	Analysts' Estimate	Q4 2023	Change (YOY)
EPS	$3.65	$4.63	$3.25	12.3%
Revenue	$1.51 billion	$1.48 billion	$1.16 billion	30%
Gross profit	$567.7 million	-	$502 million	13.1%
Net income	$393.1 million	-	$349.2 million	12.6%

This data shows a year-over-year increase in revenue while the EPS performance indicates room for improvement in cost management and responding to unforeseen expenses.

About First Solar

First Solar is recognized in the solar energy sector for its thin-film cadmium telluride (CdTe) technology. This technology is noted for its superior temperature performance and less material usage compared to traditional silicon panels. The company has a strong global presence and is focused on increasing its production capacity through strategic investments.

Recently, First Solar has emphasized enhancing its manufacturing capabilities and expanding its reach geographically. Significant developments include the opening of its facility in Alabama and the ongoing expansion of operations in Louisiana. These initiatives aim to strengthen the supply chain and respond to growing market demand.

Quarter Highlights and Ongoing Challenges

In the fourth quarter, First Solar’s sales grew significantly, reaching $1.5 billion, representing a 30% increase from the previous year, driven mainly by strong module sales. Despite this, the company's EPS fell short of what analysts had anticipated, which may suggest challenges related to managing costs and dealing with unexpected financial burdens.

The commitment to innovation was clear, as First Solar continued to invest in its CuRe production technology and ramped up research and development (R&D). These efforts support the company’s strategy of providing competitive solar solutions that align with sustainable practices. Their recycling initiatives also underscore the commitment to eco-friendly operations.

Nevertheless, First Solar is grappling with certain pressures, such as increasing competition and pricing strategies, particularly in markets like India. There are also concerns regarding how higher interest rates may impact product demand. Additionally, reliance on regulatory support, such as the Inflation Reduction Act, poses a risk to profitability should any policies change.

On the financial side, First Solar ended the year with a strong net cash balance of $1.2 billion. However, due to its aggressive expansion plans, the company expects a significant reduction in cash reserves in the coming years, projecting a balance of between $0.7 billion and $1.2 billion in 2025.

Future Outlook

Looking ahead, First Solar’s management has forecasted net sales for 2025 in the range of $5.3 billion to $5.8 billion, with anticipated EPS between $17 and $20. The company aims to sell between 18 to 20 gigawatts (GW) in 2025, propelled by its expanded production capabilities and robust market interest. This guidance includes expected benefits from the Inflation Reduction Act, contributing between $1.65 billion and $1.7 billion from production tax credits.

Investors should stay alert to First Solar’s growth in manufacturing capabilities and ongoing technological advancements. As the company maneuvers through market pressures and regulatory changes, its strategic choices will be key in maintaining profitability. The focus will likely remain on geographic expansion and taking advantage of governmental incentives to support growth.

FirstSolar, Earnings, Revenue