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SunPower Reports Third Quarter 2022 Results

  • Added a record 23,000 customers in the third quarter, a 63% increase YoY

  • Accelerated revenue growth 67% YoY

  • Reported Net Income attributable to stockholders of $139M, Adjusted EBITDA of $33M which more than doubled Q2 results

  • Announced collaboration with General Motors to develop home energy system; General Motors named SunPower as exclusive solar provider

RICHMOND, Calif., Nov. 8, 2022 /PRNewswire/ -- SunPower Corp. (NASDAQ:SPWR), a leading solar technology and energy services provider, today announced financial results for the third quarter, ending October 2, 2022.

SunPower Logo. (PRNewsFoto/SunPower Corp.)
SunPower Logo. (PRNewsFoto/SunPower Corp.)

"In the third quarter we continued to break records for customer growth and revenue, putting us on track toward the high end of our 2022 guidance for these metrics. Our strategy is working: with our focus on providing a world-class customer experience and industry-leading products, coupled with the right financing options, we are driving strong market share gains and a significant backlog that we believe will benefit us well into 2023," said Peter Faricy, CEO of SunPower. "We also introduced new products and strategic alliances that keep SunPower at the forefront as consumer demand for better, cleaner, more reliable energy continues to grow."

THIRD QUARTER BUSINESS HIGHLIGHTS

World-class customer experience

  • Highest rated solar company: In the third quarter of 2022, SunPower held its position as the number one1 rated solar company in the U.S. CNET also named SunPower the best solar company overall in its list of best solar companies in 2022.

Best, most affordable products

  • Expanded SunVault® portfolio: In September, SunPower announced two new battery storage configurations offering increased energy density and maximized space within the battery box. Additionally this quarter, Good Housekeeping awarded SunVault a spot on its list of top home renovation products in the Biggest Energy Savers category.

Growth

  • Powering homes of the future with General Motors: In October, SunPower announced a collaboration with General Motors (NYSE:GM) to develop a new home energy system that will enable General Motors' compatible electric vehicles (EVs) to provide backup energy to an equipped home with bi-directional charging. GM also named SunPower as a preferred EV charger installation provider and its exclusive solar provider.

  • Investing in high-potential dealers: SunPower announced it made minority investments in Renova Energy and EmPower Solar in September. As the latest entrants in its Dealer Accelerator Program, SunPower will provide capital financing and business strategy support to accelerate their growth and meet the increasing homeowner demand for solar nationwide. Dealers in the program exclusively sell industry-leading SunPower® solar systems, offer SunVault battery storage and leverage SunPower Financial™ offerings.

  • Continuing to lead in new homes: SunPower's new homes business achieved a record number of installed homes in the third quarter. The Company also continues to expand its new homes business across the country: in the third quarter, the Company solidified a four-year, nationwide exclusive agreement with Dream Finders Homes (NYSE:DFH) to be its exclusive provider of solar and storage solutions. This expands upon SunPower's deal with Dream Finders Homes last quarter to build five solar-standard communities in Colorado.

Digital innovation

  • Launched new digital tools to enhance customer experience: SunPower launched a new real-time data visualization tool that enables dealers to identify device production and communication issues and panel performance trends more quickly and accurately. Doing so supports SunPower's aim to continue to improve its category-leading customer responsiveness and ensure customer's systems are performing as desired.

World-class financial solutions

  • Financial bookings increasing rapidly: SunPower Financial achieved 49% bookings attach rate in September, achieving its 2022 run-rate goal a quarter early. Net bookings of SunPower Financial products in the third quarter grew 94% YoY.

  • Strong demand for lease and Power Purchase Agreements (PPA): The company's lease and PPA net bookings have grown more than 120% YoY, following the passage of the Inflation Reduction Act.

1 Based on public solar providers in the U.S. Includes average of BBB, Yelp, ConsumerAffairs, BestCompany, Google, SolarReviews and EnergySage reviews scores as of 10/1/22

Financial Highlights

($ Millions, except percentages, residential
customers, and per-share data)

3rd Quarter 2022

2nd Quarter 2022

3rd Quarter 2021

GAAP revenue from continuing operations

$475.7

$417.8

$283.3

GAAP gross margin from continuing operations

22.2 %

19.5 %

22.0 %

GAAP net income (loss) from continuing operations

$139.4

$(42.5)

$(72.7)

GAAP net income (loss) from continuing operations
per diluted share

$0.74

$(0.24)

$(0.42)

Non-GAAP revenue from continuing operations1

$469.8

$414.1

$281.6

Non-GAAP gross margin from continuing operations1

22.8 %

21.3 %

22.4 %

Non-GAAP net income (loss) from continuing
operations1

$23.6

$5.2

$20.4

Non-GAAP net income (loss) from continuing
operations per diluted share1

$0.13

$0.03

$0.12

Adjusted EBITDA1

$32.6

$15.2

$26.3

Residential customers

486,700

463,600

390,200

Cash2

$396.5

$206.4

$260.5


The sale of our C&I Solutions business met the criteria for classification as "discontinued operations" in accordance with the guidance in ASC 205-20, Discontinued Operations, beginning the first quarter of fiscal 2022. For all periods presented, the financial results of C&I Solutions are excluded in the table above.


1Information about SunPower's use of non-GAAP financial information, including a reconciliation to U.S. GAAP, is provided under "Use of Non-GAAP Financial Measures" below.


2Includes cash and cash equivalents, excluding restricted cash

2022 Financial Outlook
SunPower affirmed prior 2022 guidance of $2,000-$2,400 Adjusted EBITDA per customer and 73,000-80,000 incremental customers, resulting in $90-$110 million Adjusted EBITDA for the year.

Earnings Conference Call Information
SunPower will discuss its third quarter 2022 financial results on Tuesday, November 8 at 8:30 a.m. Eastern Time. The conference call can be accessed live by registering at https://register.vevent.com/register/BI45f40baae7fb4eb19531e810dd5b7edb. The live audio webcast and supplemental financial information will be available on SunPower's investor website at http://investors.sunpower.com/events.cfm.

About SunPower 
SunPower (NASDAQ:SPWR) is a leading solar technology and energy services provider in North America. SunPower offers the only solar + storage solution designed and warranted by one company that gives customers control over electricity consumption and resiliency during power outages. For more information, visit www.sunpower.com.

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding: (a) expectations regarding demand and our future performance based on backlog, bookings, projected consumer demand, and pipelines in our sales channels and for our products, and our ability to meet consumer demand; (b) our plans and expectations with respect to our strategic partnerships and initiatives, including our relationship with General Motors, our agreement with Dream Finders Homes, and our dealer accelerator program, and the anticipated business and financial impacts thereof; (c) our strategic plans and areas of investment and focus, both current and future, and expectations for the results thereof, including improved customer experience, increased installation capacity, and development of new products and services; (d) our expectations regarding projected demand and growth in 2022 and beyond, our positioning for future success, and our ability to capture demand and deliver long-term value to our shareholders; (e) our expectations for industry trends and factors, and the impact thereof on our business and strategic plans; and (f) our guidance for fiscal year 2022, including Adjusted EBITDA per customer, incremental customers, and Adjusted EBITDA, and related assumptions.

These forward-looking statements are based on our current assumptions, expectations, and beliefs and involve substantial risks and uncertainties that may cause results, performance, or achievement to materially differ from those expressed or implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to: (1) regulatory changes and the availability of economic incentives promoting use of solar energy; (2) potential disruptions to our operations and supply chain that may result from epidemics or natural disasters, including impacts of the COVID-19 pandemic, and other factors; (3) competition in the solar and general energy industry, supply chain constraints, interest rates, inflation, and pricing pressures; (4) changes in public policy, including the imposition and applicability of tariffs and duties; (5) our dependence on sole- or limited-source supply relationships, including for our solar panels and other components of our products; (6) risks related to the introduction of new or enhanced products, including potential technical challenges, lead times, and our ability to match supply with demand while maintaining quality, sales, and support standards; (7) the success of our ongoing research and development efforts and our ability to commercialize new products and services, including products and services developed through strategic partnerships; (8) our liquidity, indebtedness, and ability to obtain additional financing for our projects and customers; and (9) challenges managing our acquisitions, joint ventures, and partnerships, including our ability to successfully manage acquired assets and supplier relationships. A detailed discussion of these factors and other risks that affect our business is included in filings we make with the Securities and Exchange Commission (SEC) from time to time, including our most recent reports on Form 10-K and Form 10-Q, particularly under the heading "Risk Factors." Copies of these filings are available online from the SEC or on the SEC Filings section of our Investor Relations website at investors.sunpower.com. All forward-looking statements in this press release are based on information currently available to us, and we assume no obligation to update these forward-looking statements in light of new information or future events.

©2022 SunPower Corporation. All rights reserved. SUNPOWER, SUNPOWER FINANCIAL, SUNVAULT, and the SUNPOWER logo are trademarks or registered trademarks of SunPower Corporation in the U.S.

SUNPOWER CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)



October 2, 2022


January 3, 2021

Assets




Current assets:




Cash and cash equivalents

$                    396,510


$                    123,735

Restricted cash and cash equivalents, current portion

13,204


691

Short-term investments

138,735


365,880

Accounts receivable, net

178,302


121,268

Contract assets

36,490


25,994

Inventories

228,253


214,432

Advances to suppliers

6,432


462

Prepaid expenses and other current assets

192,392


100,212

Current assets of discontinued operations


120,792

Total current assets

1,190,318


1,073,466





Restricted cash and cash equivalents, net of current portion

24,265


14,887

Property, plant and equipment, net

64,784


33,560

Operating lease right-of-use assets

38,295


31,654

Solar power systems leased, net

42,552


45,502

Goodwill

126,338


126,338

Other intangible assets, net

24,312


24,879

Other long-term assets

206,630


156,994

Long-term assets of discontinued operations


47,526

Total assets

$                 1,717,494


$                 1,554,806





Liabilities and Equity




Current liabilities:




Accounts payable

$                    194,133


$                    138,514

Accrued liabilities

142,714


101,980

Operating lease liabilities, current portion

11,179


10,753

Contract liabilities, current portion

135,497


62,285

Short-term debt

2,185


109,568

Convertible debt, current portion

424,609


     Current liabilities of discontinued operations


86,496

Total current liabilities

910,317


509,596





Long-term debt

72,567


380

Convertible debt, net of current portion


423,677

Operating lease liabilities, net of current portion

31,400


28,566

Contract liabilities, net of current portion

18,344


18,705

Other long-term liabilities

118,242


141,197

Long-term liabilities of discontinued operations


42,661

Total liabilities

1,150,870


1,164,782





Equity:




Common stock

174


173

Additional paid-in capital

2,845,845


2,714,500

Accumulated deficit

(2,073,788)


(2,122,212)

Accumulated other comprehensive income

11,097


11,168

Treasury stock, at cost

(225,703)


(215,240)

Total stockholders' equity

557,625


388,389

Noncontrolling interests in subsidiaries

8,999


1,635

Total equity

566,624


390,024

Total liabilities and equity

$                 1,717,494


$                 1,554,806

 

SUNPOWER CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)




THREE MONTHS ENDED


NINE MONTHS ENDED



October 2,
2022


July 3,
2022


October 3,
2021


October 2,
2022


October 3,
2021

Total revenues


$         475,711


$         417,772


$         283,312


$     1,243,760


$         784,199

Total cost of revenues


370,264


336,273


220,923


984,505


615,133

Gross profit


105,447


81,499


62,389


259,255


169,066

Operating expenses:











Research and development


6,784


7,405


2,615


19,199


11,497

Sales, general, and administrative


87,124


93,043


43,704


257,163


135,449

Restructuring (credits) charges


111


(494)


(230)


244


4,344

(Gain) loss on sale and impairment of
residential lease assets






(294)

(Income) expense from transition
services agreement, net


(1,059)


(494)


(468)


(1,287)


(5,211)

Total operating expenses


92,960


99,460


45,621


275,319


140,495

Operating income (loss)


12,487


(17,961)


16,768


(16,064)


28,571

Other income (expense), net:











Interest income


144


92


43


278


168

Interest expense


(4,216)


(5,964)


(5,171)


(15,224)


(18,828)

Other, net


135,368


(14,652)


(86,099)


122,160


(46,539)

Other income (expense), net


131,296


(20,524)


(91,227)


107,214


(65,199)

Income (loss) from continuing operations
before income taxes and equity in earnings
of unconsolidated investees


143,783


(38,485)


(74,459)


91,150


(36,628)

(Provision for) benefits from income taxes


(3,109)


(3,226)


2,015


5,308


3,547

Equity in earnings (losses) of
unconsolidated investees


1,958




1,958


Net income (loss) from continuing operations


142,632


(41,711)


(72,444)


98,416


(33,081)

(Loss) income from discontinued
operations before income taxes and
equity in losses of unconsolidated
investees1



(20,857)


(12,042)


(47,155)


(27,401)

Benefits from (provision for) income
taxes from discontinued operations



241


179


584


1,446

Net (loss) income from discontinued
operations, net of taxes



(20,616)


(11,863)


(46,571)


(25,955)

Net income (loss)


142,632


(62,327)


(84,307)


51,845


(59,036)

Net (income) loss from continuing
operations attributable to noncontrolling
interests


(3,225)


(785)


(263)


(3,671)


321

Net (income) loss from discontinued
operations attributable to noncontrolling
interests




194


250


1,161

Net (income) loss attributable to
noncontrolling interests