Beleaguered SunPower Corp. (NASDAQ: SPWR) announced a series of cost-cutting measures on Wednesday, including workforce reductions, residential installation location closures, and the discontinuation of direct sales. These measures are part of a broader business restructuring drive aimed at simplifying operations and focusing on more sustainable and profitable areas within the solar industry. The company’s shares have declined nearly 60% year-to-date. SunPower’s workforce reduction will see approximately 1,000 employees let go in the coming days and weeks, resulting in an estimated $28 million in severance pay and early termination charges. The move follows a Bloomberg report on Tuesday that SunPower was planning to revise years of financial statements due to misclassification of sales commissions and other costs. These misclassifications are expected to reduce the last two years of income by $15 million to $25 million. This is not the first time SunPower has revised its earnings; in 2023, earnings were delayed due to a revision. In January, SunPower announced a restructuring of its operations to enhance cost-effectiveness. Despite SunPower’s challenges, the solar industry in the U.S. is expected to benefit from the Biden administration’s Inflation Reduction Act (IRA), which provides incentives for clean energy development and could create opportunities for domestic solar companies. The IRA is also attracting interest from European solar companies seeking alternatives to cheap Chinese-made solar panels.
SunPower Slashes Workforce, Cuts Locations, and Halts Direct Sales in Business Restructuring Drive
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