China-headquartered solar cell and module manufacturer JinkoSolar saw a 44% decline in its first quarter (Q1) profit as decreasing module prices hurt the company’s margins. Adjusted net income, excluding certain non-cash expenses, fell from RMB 836.4 million ($115.8 million) last year to RMB 470.3 million ($65.1 million) in 2024.

The company’s gross margin fell to 11.9% in Q1 from 17.3% in the same period last year.

Module prices have been steadily falling since last year owing to China’s industrial overcapacity. While this has been advantageous for developers, it has put significant pressure on module manufacturers, reflected in their recent poor financial performances.

“Module prices continued to fall in the first quarter,” said CEO Xiande Li in a statement, adding that the company expects the profitability of its integrated solar companies to come under pressure in the short term.

Quarterly revenue also saw a marginal 1.2% fall, from RMB 23.33 billion ($3.23 billion) to RMB 23.04 billion ($3.19 billion).

Lower revenue and profits were despite total solar module shipments rising 53.3% from the prior year. The company shipped nearly 20 GW of modules in Q1, from 13.22 GW in the same period the previous year.

The increase was driven by higher demand from foreign markets at a time when manufacturers in the U.S. and Europe were complaining of cheap Chinese solar modules flooding their markets.

Jinko’s module exports increased over 20% year-over-year, with over 70% of modules being shipped to overseas markets in the first quarter.

“We expect more shipments, particularly in the U.S., as well as in the European market,” said CFO Charlie Cao during a post-earnings conference call with analysts, adding that he believes the pricing of modules is “already reaching rock-bottom.”

Commenting on the trade tensions, particularly with the U.S., CMO Gener Miao said that trade tariffs and current geopolitical issues are “definitely a big challenge” and have contributed to an increase in costs.

“But as a company side, we have no choice but to try our best to adapt towards the market or what the government wants. So that’s why we are working very hard with our lawyers, with our customers, trying to find out the best solutions in the U.S. market,” he added.

N-type modules accounted for nearly 80% of JinkoSolar’s total module shipment. Meanwhile, nearly 50% of module shipments to North America were N-type.

The company said it is accelerating the phasing out of its P-type capacity and expects N-type modules to exceed 90% of total capacity by the end of 2024.

It reported a 73% jump in net profit in the previous quarter owing to higher shipments.