Maxeon Reports Q1 Results Amidst Market Challenges and Strategic Adjustments
Maxeon Solar Technologies, Ltd. faced a challenging operating environment in the first quarter of 2024 due to industry pricing conditions, demand disruptions in its distributed generation (DG) business, and project delays by large-scale customers. These factors resulted in underutilized manufacturing operations, higher product costs, and lower revenue and profit than anticipated.
To address its liquidity needs, Maxeon secured additional capital from its largest shareholder, TZE. The investment includes both debt and equity components, subject to regulatory approvals. TZE will also become the controlling shareholder of Maxeon.
Strategic Initiatives and Business Developments
Despite the challenges, Maxeon executed several key strategic initiatives. The Company completed deliveries to SunPower Corporation under the Settlement Agreement and added over 100 new partners to its U.S. Dealer channel, including key installers with whom it has collaborated for over a decade. In China, Maxeon successfully introduced its 7th generation Performance Series module, which utilizes TOPCon cell technology.
Maxeon divested its stake in the Huansheng Photovoltaic (HSPV) joint venture and executed an IP license for shingling technology for HSPV’s use in utility-scale markets outside of China. The Company also entered into a new supply agreement with HSPV to support its international DG business.
Going forward, Maxeon will focus its utility-scale operations exclusively on the U.S. market, where it holds strong customer relationships and a differentiated product portfolio. The Company is cautiously optimistic about potential improvements in pricing power and demand, as well as increased bookings.
Financial Guidance and Outlook
For fiscal year 2024, Maxeon provided preliminary guidance, subject to change:
– Revenue: within a range of $1.0 billion to $1.1 billion
– Adjusted EBITDA: within a range of $70 million to $150 million
– Capital expenditures: within a range of $150 million to $200 million
Ongoing Transformation
Management emphasized the need to rebuild Maxeon’s balance sheet and transform the business to return to profitability and reduce customer concentration risk. The Company’s ongoing initiatives include enforcing intellectual property rights against competitors, refining its cost structure, and focusing on operational efficiency.
Maxeon’s first quarter 2024 financial results and management commentary are available in its Form 6-K filing on the Investor Relations section of its website. The Form 6-K and other company filings are also accessible from the Securities and Exchange Commission website.
