U.S.-based solar module manufacturer First Solar reported net sales of $1.23 billion in the third quarter (Q3) of 2026, a 22.8% year-over-year (YoY) decline from $1.59 billion. Revenue missed analysts’ expectations by $57.62 million.

The decline was primarily due to lower volumes of modules sold to third-party customers compared to the corresponding quarter of 2025.

First Solar’s adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) increased 10.8% YoY to $744 million from $671.46 million. The adjusted EBITDA margin rose to 60% from 42%.

The company’s net profit increased 25.2% YoY to $571.06 million from $455.94 million.

Diluted earnings per share (EPS) increased to $5.30 from $4.24 in the corresponding quarter of the previous year, exceeding analysts’ expectations by $0.63.

9M Results

In the first nine months (9M) of 2026, First Solar reported net sales of $3.33 billion, a 5.8% YoY decline from $3.54 billion.

Net profit increased 33.1% YoY to $1.34 billion from $1.01 billion.

Diluted EPS rose to $12.45 from $9.37 in the corresponding period of the previous year.

Adjusted EBITDA increased 18.4% YoY to $1.91 billion from $1.61 billion. The adjusted EBITDA margin increased to 57% from 46%.

India Operations

First Solar reduced its forecast for domestic module sales from its India manufacturing facility by approximately 700 MW for 2026.

Alexander Bradley, Chief Financial Officer, said the company had initially assumed that production at its India facility would be adjusted to match domestic demand at acceptable selling prices, given the market’s short contracting cycle.

The company expects finished module production at its India facility to range between 2.2 GW and 2.6 GW in 2027.

First Solar plans to begin converting its India manufacturing facility to copper replacement (CuRe) technology in the first quarter of 2027, marking the first Series 7 CuRe conversion across its manufacturing network.

Mark Widmar, CEO, said the company would use the India conversion to refine its technology deployment process before implementing similar upgrades across its U.S. Series 7 manufacturing facilities.

During subsequent U.S. conversions, First Solar plans to redirect front-end production from India to supply its U.S. finishing operations, subject to favorable trade conditions.

The arrangement is expected to support U.S. manufacturing throughput while preserving partial domestic content and Section 45X tax credit eligibility during the transition.

Bradley said the company expects to increase exports from India to the U.S. in 2027 to improve the facility’s margin potential, subject to favorable policy and trade conditions.

Manufacturing Expansion

First Solar commenced production at the first phase of its South Carolina Series 6 finishing facility during Q3 2026.

Widmar said the second phase is expected to commence commercial operations by mid-2027, following a one-quarter delay to incorporate CuRe technology at launch.

The company expects the two phases to produce between 2.2 GW and 2.5 GW of modules in 2027.

First Solar’s Ohio pilot line, designed to manufacture Series 6-sized perovskite modules, remains on schedule to achieve operational readiness during the first half of 2027.

The company also entered into a licensing agreement with CubicPV, complementing its existing intellectual property arrangement with Oxford PV to support perovskite technology development.

Bradley said First Solar increased its expected perovskite-related expenditure for 2026 to approximately $120 million from the earlier forecast of $100 million.

He attributed higher core operating expenses partly to increased legal expenditure associated with defending the company’s tunnel oxide passivated contact (TOPCon) intellectual property and additional investment in perovskite research.

Module Bookings and Backlog

First Solar ended the third quarter with a contracted module sales backlog of 44 GW, representing approximately $13.5 billion in contracted value, excluding technology-related price adjustments. Deliveries extend through 2030.

Bradley said the company secured approximately 1.4 GW of additional U.S. gross bookings since its previous earnings call at an average selling price of approximately $0.36/W, including applicable technology adjustments.

Widmar said First Solar’s U.S. bookings during 2026 had reached approximately 4.9 GW at average selling prices of $0.35/W to $0.36/W.

The company also has approximately 4 GW of additional potential module volumes under previously signed contracts that are excluded from its current backlog.

Bradley said customers must decide whether to exercise approximately half of this volume within five months, with decisions on the remaining capacity extending through 2027 and 2028.

U.S. Solar Demand and Trade Policy

Widmar said the Section 232 proclamation issued in August 2026 represented a significant change in the U.S. solar manufacturing landscape.

He expects the trade measures to support domestic manufacturing and strengthen First Solar’s competitive position.

By 2027, nearly 80% of First Solar’s global module manufacturing footprint is expected to be located in the U.S.

Widmar said demand for utility-scale solar remains supported by artificial intelligence infrastructure, electrification, and the expansion of domestic manufacturing, which are increasing electricity consumption.

However, inflation, changing tariffs, and higher system costs are affecting project economics. Rising battery prices are also creating challenges for projects under construction and those participating in power purchase agreement bidding.

He said uncertainty surrounding final foreign entity of concern guidance, Section 232 tariffs, minimum import prices, and measures against stockpiling imported modules had complicated procurement decisions.

First Solar expects to decide the future of its Malaysia manufacturing facility during the first half of 2027.

Widmar said the company would either operate the facility at full or near-full annual capacity of 1.8 GW or shut down production, depending on demand, tariffs, and commercial conditions.

He said neither outcome was expected to materially affect the company’s normalized earnings profile.

Widmar also said First Solar had increased its pricing expectations for new contracts and agreements that were in the early stages of negotiation following the Section 232 announcement.

Guidance

First Solar lowered its 2026 net sales guidance to $4.6 billion to $4.9 billion from the previous forecast of $4.9 billion to $5.2 billion.

Expected module sales volumes were reduced to between 16 GW and 17 GW from the earlier guidance of 17 GW to 18.2 GW.

Bradley attributed the revision to lower expected India domestic sales, international Series 6 module sales, and U.S. finishing volumes.

Adjusted EBITDA is now forecast between $2.55 billion and $2.75 billion, compared with the earlier estimate of $2.6 billion to $2.8 billion.

For the fourth quarter, First Solar expects module sales of 4.3 GW to 5.3 GW, including 3.4 GW to 4.3 GW from its U.S. manufacturing operations.

Adjusted EBITDA for Q4 is forecast between $643 million and $843 million.

First Solar reported net sales of $1.06 billion in the second quarter of 2026, a 3.7% YoY decline from $1.1 billion.