End of year turmoil: this inverter leader cuts jobs, 1 module plant defaults!
Recently, the U.S. solar industry is also uneasy, following Maxeon Solar layoffs 20%, there are two solar power company after another business problems.
In the latest development, U.S. microinverter distributor Enphase Energy announced that it will downsize about 10% of its global workforce, including about 350 contractors and employees, in an effort to reduce corporate costs and bring its corporate and employee cost structure more closely in line with "current market standards".
In addition, Enphase Energy will also terminate operations at its contracted manufacturing sites in Timisoara, Estonia, and Wisconsin, USA, in anticipation of adjusting the size of other contracted sites. The company will focus on manufacturing microinverters in the U.S., with two existing contract manufacturing partners located in South Carolina and Texas.
In a letter to the company's employees, Badri Kothandaraman, CEO and President of Enphase Energy, said, "The solar power sales market has experienced a lot of turbulence and uncertainty around the world over the past 12 months. In the U.S., low interest rates have resulted in a continued decline in customer demand, and further uncertainty has arisen from the NEM 3.0 transition development in California. Before the year 2023, everyone saw great improvements abroad. At that time requirements slowed and APRs caused inventory levels to continue to rise."
The company's regrouping program is planned for the first half of 2024. Enphase Energy (ENPH.US) is the world's No. 1 producer of microinverters, according to the data, and the company was founded in 2006 with corporate headquarters in Fremont, California.
SunPower Destroys Contract, Causing Concerns
SunPower, a local solar power company in the US, has announced that it has reneged on a bank credit agreement, raising anxiety about its ability to operate in the long term.
In a control document, SunPower indicated that after the company failed to submit its third quarter financial report on time, the company that lent money to SunPower's projects has the right to demand immediate repayment of 65.3 million dollars or take other precautions because of the breach of the bank credit agreement.
Significant Doubts About SunPower's Ability to Operate in the Long Term
SunPower has indicated that because of this control document, the company cannot borrow from the remaining $53.7 million in energy revolving commitments, but that the company has been granted a temporary waiver through January 19, 2024, to do so.
However, the company indicated that "everyone signed the amendment and waiver letter to temporarily deal with the existing breach of contract challenges, and even so, it is predicted that we will not be able to comply with some of the liability contracts, which would have led to further breaches of contract under the original liability arrangements."
SunPower is still seeking additional waivers and evaluating various equity financing alternatives. The company emphasized that "it is difficult to guarantee that such equity financing will be available." If the company has difficulty obtaining new sources of funding, then SunPower's ability to continue operations will be highly questionable.
In addition to the latest default, SunPower lowered its sales guidance for fiscal 2023 in November because of the delay in revenue guidance caused by lower customer demand and its extended cycle. The company lowered its net loss estimate for the year to $165-175 million. On top of that, SunPower also lowered its forecast for household customers this year to more 80,000 from more 90,000 originally.
SunPower reported a net loss of $32 million in the third quarter of 2023, compared to a net income of $138.4 million in the third quarter of 2022 and a net loss of $30.3 million in the second quarter of 2023.
Earlier, solar power producer Maxeon Solar Technologies (which split from household solar power company SunPower in 2020 to assume its manufacturing business processes) announced that it will downsize about 22% of its global workforce. The company identified the phasing out of Maxeon6 IBC components and other business adjustments.