First Solar Second-Quarter Profit Drops as Module Prices Decline
First Solar Inc. (FSLR), the world’s biggest maker of thin-film solar modules, said second-quarter profit fell more than analysts expected as panel prices slumped. The shares sank 5.3 percent in after-hours trading.
Net income fell to $61.1 million, or 70 cents a share, from $159 million, or $1.84 a share, a year earlier, the Tempe, Arizona-based company said in a statement today. First Solar was expected to earn 91 cents, the average of 26 analysts’ estimates compiled by Bloomberg. Sales fell 9.4 percent to $532.8 million.
Global prices for solar modules have dropped to about $1.40 a watt in June from more than $2 at the end of last year, and may fall to $1.10 for some suppliers, according to Bloomberg New Energy Finance. First Solar also can’t include module sales to its own construction projects until they are sold to third parties.
“This was a really weak quarter as they faced significant pricing pressure,” John Hardy, an analyst at Gleacher & Co. in New York who has a “buy” rating on the shares, said in an interview. “Their lower guidance isn’t good, but it shows their second half should be much better.”
For the year, First Solar reduced its sales guidance to $3.6 billion to $3.7 billion from $3.7 billion to $3.8 billion and per-share profit to a range of $9.00 to $9.50 from $9.25 to $9.75. Analysts had expected net income of $9.23 a share on sales of $3.76 billion.
First Solar fell $5.74, or 5.3 percent, to $102.20 at 4:09 p.m. in after-hours trading on the Nasdaq Stock Market, extending a 6.3 percent drop today in regular U.S. trading.
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