Enphase Energy Reports Financial Results for the Second Quarter of 2019
July 30, 2019 at 4:05 PM EDT
Download PDF
FREMONT, Calif., July 30, 2019 (GLOBE NEWSWIRE) -- Enphase Energy, Inc. (NASDAQ:ENPH), a global energy technology company and the world’s leading supplier of solar microinverters, announced today financial results for the second quarter of 2019, which included the summary below from its President and CEO, Badri Kothandaraman.
Highlights for the second quarter of 2019 included:
Revenue of $134.1 million; IQ 7 shipments at 98% of all microinverters
Cash flows from operating activities of $14.8 million; ending cash balance of $206.0 million
GAAP gross margin of 33.8%; non-GAAP gross margin of 34.1%
GAAP operating expenses of $27.9 million; non-GAAP operating expenses of $22.5 million
GAAP operating income of $17.4 million; non-GAAP operating income of $23.2 million
GAAP net income of $10.6 million; non-GAAP net income of $23.2 million
GAAP diluted EPS of $0.08; non-GAAP diluted EPS of $0.18
Our revenue and earnings for the second quarter are given below, compared with those of the prior quarter and the year ago quarter:
(In thousands, except per share data and percentages)
GAAP Non-GAAP
Q2 2019 Q1 2019 Q2 2018 Q2 2019 Q1 2019 Q2 2018
Revenue $ 134,094 $ 100,150 $ 75,896 $ 134,094 $ 100,150 $ 75,896
Gross margin 33.8 % 33.3 % 29.9 % 34.1 % 33.5 % 30.5 %
Operating income (loss) $ 17,447 $ 7,134 $ (558 ) $ 23,227 $ 11,282 $ 4,133
Net income (loss) $ 10,618 $ 2,765 $ (3,738 ) $ 23,173 $ 9,528 $ 1,550
Basic EPS $ 0.09 $ 0.03 $ (0.04 ) $ 0.20 $ 0.09 $ 0.02
Diluted EPS $ 0.08 $ 0.02 $ (0.04 ) $ 0.18 $ 0.08 $ 0.01
Our second quarter revenue was $134.1 million, an increase of 34% sequentially and an increase of 77% year-over year. We shipped approximately 416 megawatts DC, or 1,283,680 microinverters. We continued to see strong demand across the board from our customers. While demand continued to outstrip available supply, we were able to increase capacity to better support our customers. As stated before, we are on track to have a supply of approximately two million microinverters in the fourth quarter of 2019.
Our non-GAAP gross margin was 34.1%, an increase of 60 basis points from 33.5% in the first quarter of 2019. The non-GAAP gross margin was negatively impacted by approximately 330 basis points due to expedite fees related to component shortages, compared to approximately 280 basis points in the prior quarter. The expedite fees were in the form of air shipments that we chose to make in order to service our customers. Non-GAAP operating expenses were $22.5 million, compared to $22.3 million in the prior quarter.
We exited the second quarter with $206.0 million in cash and generated $14.8 million in cash flows from operations. The second quarter cash balance included net proceeds of approximately $115.5 million on June 5, 2019 associated with the issuance of $132.0 million aggregate principal amount of convertible senior notes due 2024 and the repurchase of $60.0 million aggregate principal amount of convertible notes due 2023 in exchange for shares of Enphase Energy common stock and separate cash payments. Inventory was $20.1 million in the second quarter, compared to $13.0 million in the first quarter of 2019 and $17.5 million in the second quarter of 2018.
BUSINESS HIGHLIGHTS
On June 10, 2019, Enphase Energy announced that more than 500 solar installation companies in the U.S. have benefitted from significantly reduced solar design complexity and logistics by adopting Enphase Energized™ AC Modules (ACMs). Enphase Energized AC Modules, first released in October 2017, are factory-assembled, tested and sold by Enphase ACM partners, including SunPower, Panasonic and Solaria. Enphase Energized AC Modules are built by strategic module partners who integrate Enphase microinverters with PV modules on the manufacturing line. ACMs are tested for performance, reliability, and quality right on the manufacturing line and allow solar installers to offer premium solutions to homeowners.
On June 17, 2019, Enphase Energy announced that it renewed its low-income solar partnership with GRID Alternatives, a national leader in making renewable energy technology and job training accessible to underserved communities. Through the donation of microinverters, Enphase will help GRID Alternatives meet its goal of installing more than 10 megawatts of solar power in 2019, helping families and affordable housing providers save millions of dollars in energy costs and providing hands-on solar installation training to over 4,000 individuals.
On July 1, 2019, Enphase Energy announced the first shipment of seventh-generation Enphase IQ™ microinverters produced in Mexico as part of its expanded manufacturing agreement with Flex. As previously announced, Enphase plans to sell products produced in Mexico into the U.S. market to mitigate tariffs, increase global capacity and improve customer delivery times.
THIRD QUARTER 2019 FINANCIAL OUTLOOK
For the third quarter of 2019, Enphase Energy estimates both GAAP and non-GAAP financial results as follows:
Revenue to be within a range of $170 million to $180 million, including a range of $6 million to $10 million for ITC safe harbor
GAAP and non-GAAP gross margin to be within a range of 33% to 36%
GAAP operating expenses to be within a range of $28.5 million to $30.5 million, including a total of approximately $5.0 million estimated for stock-based compensation expenses and acquisition related expenses and amortization
Non-GAAP operating expenses to be within a range of $23.5 million to $25.5 million, excluding a total of approximately $5.0 million estimated for stock-based compensation expenses and acquisition related expenses and amortization
Follow Enphase Online
Read the Enphase blog.
Follow @Enphase on Twitter.
Visit us on Facebook and LinkedIn.
Watch Enphase videos on YouTube.
Use of Non-GAAP Financial Measures
The Company has presented certain non-GAAP financial measures in this press release. To view a description of non-GAAP financial measures used and the non-GAAP reconciliation schedule for the periods presented, click here.
Conference Call Information
Enphase Energy will host a conference call for analysts and investors to discuss its second quarter 2019 results and third quarter 2019 business outlook today at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time). The call is open to the public by dialing (877) 644-1284; participant passcode 1397564. A live webcast of the conference call will also be accessible from the “Investor Relations” section of the Company's website at investor.enphase.com. Following the webcast, an archived version will be available on the website for one year. In addition, an audio replay of the conference call will be available by calling (855) 859-2056; participant passcode 1397564, beginning approximately one hour after the call.
Forward-Looking Statements
This press release contains forward-looking statements, including statements related to Enphase Energy’s expected future financial performance; the capabilities and performance of our technology and products, including the anticipated market adoption of current and future products; the reduction in design complexity and logistics, and the potential for savings in energy costs; performance in operations, including reducing cycle times, mitigating tariff risks, product availability and component supply management, and product quality and reliability. These forward-looking statements are based on the Company’s current expectations and inherently involve significant risks and uncertainties. Enphase Energy’s actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of certain risks and uncertainties including those risks described in more detail in the Company’s most recent Annual Report on Form 10-K and other documents on file with the SEC and available on the SEC’s website at www.sec.gov. Enphase Energy 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, except as required by law.
A copy of this press release can be found on the investor relations page of Enphase Energy’s website at investor.enphase.com.
About Enphase Energy, Inc.
Enphase Energy, a global energy technology company, delivers smart, easy-to-use solutions that connect solar generation, storage and management on one intelligent platform. The Company
AI
