SunPower Corp., the second-largest U.S. solar manufacturer, reported higher-than-expected profit in the first quarter as surging demand for rooftop systems helped the company double its gross margins.
Margins increased to 23.5 percent from 9.3 percent a year earlier, San Jose, California-based SunPower said yesterday in a statement. The increase was due in part to the company’s efforts in the residential and commercial markets, where smaller systems generate higher returns.
That gives SunPower a more diverse sales model than competitors including Yingli Green Energy Holding Co. and Trina Solar Ltd., which both notified investors this month that first-quarter shipments will fall short of the companies’ forecasts.
“In our distributed generation business we posted another great quarter,” Chief Executive Officer Tom Werner said on a conference call yesterday. Demand is outpacing supply, and the company deployed 108 megawatts of panels for residential projects in the quarter. Factories were running at full utilization.
“They’re firing on all cylinders really, with rooftop strong not just in the U.S., but globally,” Ben Kallo an analyst with Robert W. Baird & Co. in San Francisco, said in an interview.
Net income was $65 million, or 42 cents a share, compared with a loss of $54.7 million, or 46 cents a share, a year earlier. Excluding gains from a terminated contract and other adjustments, earnings of 49 cents a share beat the 32-cent average of 15 analysts’ estimates compiled by Bloomberg.
Sales rose to $692.4 million from $635.4 million a year earlier.
The company expects to recognize 275 megawatts to 300 megawatts in the current quarter, leading to earnings of 15 cents to 35 cents a share.
First Solar Inc. is the largest U.S. solar manufacturer.