Maxeon Q1 loss widens but brand-new items, greater rates backed to bolster earnings

• Maxeon Solar Technologies saw its opening quarter loss expand by 22% year-on-year as products as well as logistics costs continue to be a thorn in the side of solar suppliers.

However the company, spun out from SunPower last year, claimed it expects the addition of brand-new product, greater average selling prices (ASPs) and also an extra optimised manufacturing framework to reinforce both its top as well as bottom lines from the second half of 2020 onwards.

Last week Maxeon reported deliveries as well as profits numbers within its forecasted variety, amounting to 379MW and also US$ 165.4 million respectively. Both numbers had actually contracted from those reported in Q4 2020 as well as Q1 2020 as well as added towards net loss of US$ 38.8 million for the reporting duration, a boost of more than 22% on the US$ 31.7 million recorded in the corresponding period last year.

Jeff Seas, chief executive at Maxeon, stated the bigger net loss was attributable to decreased profit from procedures and also higher opex costs, with greater materials and also logistics prices highlighted as being particular drags on the firm's profits.

Of specific effect on Maxeon's financial performance is an out-of-market polysilicon contract, which the firm referred to as being an "continuous drag to profitability", setting you back the firm greater than US$ 80 million each year. While Maxeon sells on some of the material it does not use in its inner production, it does so at a loss because the contract is locked in "method above market value", Seas informed analysts last Thursday. The contract is to run until December 2022.

While Maxeon was likewise able to realise greater typical market price for its items in the reporting period, this was mostly reflective of the maker handing down greater supply chain prices.

Maxeon raised its module prices throughout the opening quarter and CFO Kai Strohbecke kept in mind that the rate for its IBC line of panels had risen from US$ 0.49 c per watt to US$ 0.53 c/W, while its Performance series revenue per watt had actually increased to US$ 0.28 c versus US$ 0.25 c reported in Q4 2020.

Total ASPs reported by Maxeon were up 16% sequentially, driven both by price boosts as well as the company's more pricey IBC panels recording a higher share of total sales. Maxeon's products targeted at distributed generation markets recorded a higher share, with large-scale solar module sales adding just 16% of quarterly earnings.

Waters said that consumers were progressively approving greater rates as a result of the sustained cost pressures on supply chains, and also consequently the company anticipates to start converting its pipeline right into reservations throughout H2 and also resume large-scale sales very early following year.

Maxeon has forecasted shipments of 415-- 475MW, revenues of US$ 165-- 185 million and a loss of US$ 5-- 15 million to be recorded in Q2 2021.

A more US$ 50-- 60 million is anticipated to be invested in the present quarter to upgrade its manufacturing center in Malaysia to produce Maxeon's 5 and 6 Series products from the Maxeon 2 Series it currently produces. That number likewise includes R&D expenditure for Maxeon's upcoming 7 Series item.

The maker is also backing its newly-announced Maxeon Air item to make considerable strides in Europe. Declared last week, Maxeon Air is a light-weight, frameless solar panel designed for use in domestic and also business and commercial (C&I) applications that might or else have actually been limited by reduced tons roofing systems.

Waters said the item would be almost unique upon launch and also, therefore, Maxeon would be able to become aware greater ASPs and earnings margins compared to its various other product. Maxeon is to begin manufacturing of the Air line in France, having identified Europe as a particularly solid market for the series initially, however Maxeon stressed the line's capability to be produced at any one of its facilities reasonably flexibly, with the item loaning much of the business's current module assembly processes. Maxeon's manufacturing impact in Europe is set to lessen rather however via the closure of its facility in Toulouse, which is to set you back the business in between US$ 5-- 6 million in restructuring prices in the present quarter.

Waters included that he anticipated the prospective market for the Maxeon Air line to be 4GW in Europe alone, describing the marketplace as "underserved" by modules on the marketplace today.