SolarEdge, an Israel-based solar inverter manufacturer, recorded a net loss of $162.4 million in the fourth quarter (Q4) of 2023, an 880% year-over-year (YoY) drop from the net profit of $20.8 million, primarily due to the higher interest rates and lower power prices causing an inventory buildup slowing down the shipments.

The company’s revenues were down by 65% to $316 million in Q4 from $890.7 million during the same quarter last year.

Revenues from the solar segment were $282.4 million, down 66% YoY from $837 million.

“This quarter, we shipped 2.2 million power optimizers and 74,000 inverters. This quarter, we also shipped 133 megawatt hours of batteries,” said Zvi Lando, Chief Executive Officer of SolarEdge.

“As reflected in our fourth quarter results and in the first quarter guidance released today, we continue to face challenges from general market dynamics as well as the inventory levels of our products in the channels due to the abrupt slowdown in demand in the second half of 2023. That said, we under-shipped end market demand by approximately $200 million during the fourth quarter,” said Lando.

Full-year 2023

SolarEdge recorded a net income of $34.3 million for 2023, a 63% YoY drop from $93.8 million.

The company recorded a revenue of $3 billion from January to December, a 4% YoY decrease from $3.1 billion.

Revenues from the solar segment were $2.8 billion, down 4% from $2.9 billion in the prior year.

The company shipped 12.6 GW of inverters and 744 MWh of batteries during the year compared to 10.5 GW of inverters and 889 MWh of batteries shipped last year.

“Despite the challenges we faced in the second half of 2023, we concluded the year with $3 billion in revenue, just below 2022 levels,” said Zvi Lando, Chief Executive Officer of SolarEdge.

“The first half of 2023 included record installations and expectations for continued growth, with a shift in the second half of the year to a weaker market due to higher interest rates and lower power prices, which resulted in an inventory buildup that slowed our shipments,” said Lando.

Lando attributed the challenges faced in the latter half of 2023 to higher interest rates and weaker market conditions, resulting in an inventory buildup that affected shipments. He also highlighted the inventory surplus across Europe due to increased product availability and declining demand.

In January, SolarEdge announced a restructuring initiative to trim operating expenses and adapt its cost structure to current market conditions. As part of this plan, around 16% of the company’s global workforce, totaling approximately 900 employees, were to be affected. Approximately 500 of these job cuts came from SolarEdge’s diverse manufacturing sites.

SolarEdge recorded a net loss of $61.2 million in the third quarter of 2023, a 348% year-over-year drop from the net profit of $24.7 million. The drop in net income was attributed to the considerable drop in demand, especially from the company’s primary markets in Europe, and the high inventory of products in the channels.

Tags: SolarEdge, Financial Results, Loss, Inverters