Israeli solar energy company SolarEdge Technologies (Nasdaq: SEDG) was down 18% in premarket trading on Wall Street after providing weak guidance for the fourth quarter of 2023. The company expects revenue of $300-350 million, down 60% from the corresponding quarter of 2022. Analysts had predicted revenue of $720 million - more than double. Since the start of the year, SolarEdge's share price is down 78% and it is 83% below its peak in 2021.
SolarEdge will likely end 2023 with revenue of $2.96-3.01 billion compared with $3.1 billion in 2022 - in other words an erosion in revenue compared with double-digit growth in 2022 compared with 2021. The company's market cap has now fallen to less than $3.5 billion.
SolarEdge, which develops and markets solar inverters for photovoltaic arrays and other energy generation and storage products, had issued a profit warning for the third quarter of 2023 and its financial results were in line with that. Revenue in the third quarter was $725 million, down 13% from the corresponding quarter of 2022. GAAP net profit was $61.2 million and non-GAAP net loss was $31 million compared with a non-GAAP $54.1 million net profit in the third quarter of 2022.
SolarEdge is suffering from excess inventory at its distributors, mainly in Europe, which is its biggest market. SolarEdge CEO Zvi Lando believes that the situation will persist in the coming quarters. He said, " "The results for the third quarter fell short of our prior expectations and are reflecting a slow market environment, which has resulted in high inventory of our products in the distribution channels, in particular in Europe. While channel inventory clearing is expected to continue in coming quarters, we are optimistic about the future of the solar PV industry and are confident that our leading technology, global presence and broad product offering will enable us to continue to be a leader in this market."
Published by Globes, Israel business news - en.globes.co.il - on November 2, 2023.
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