SolarEdge Posts Narrower Losses But Disappointing Forecast Sends Stock Down
Translated & summarized from Calcalist by baba
Israeli company SolarEdge reported reduced losses but a disappointing financial forecast for late 2026 caused its stock to fall 10%. The company's third-quarter revenue was $326 million with an $8 million loss, an improvement from the previous year. However, its year-end forecast missed analyst expectations, and it recently laid off 50 employees in Israel as part of a strategic shift and cost-cutting measures.
The story in 5 lines · by baba
- SolarEdge's stock fell 10% on a disappointing 2026 forecast, despite reduced quarterly losses.
- The company reported a $8 million loss in Q3, an improvement from $50 million in Q3 2025.
- SolarEdge's year-end revenue forecast of $245-275 million missed analyst expectations.
- The company recently laid off approximately 50 employees in Israel to cut costs.
- SolarEdge is shifting focus to commercial solar systems, energy software, and data center power conversion.
Despite a positive outlook for renewable energy companies following the US midterm election results, Israeli firm SolarEdge is facing a stock decline. The company's shares dropped approximately 10% in pre-market trading in the US due to a disappointing forecast for the final quarter of 2026. However, the company's recently released quarterly financial reports indicate an improvement in results and a reduction in losses.
SolarEdge, which manufactures components for solar energy systems, reported third-quarter revenues of about $326 million, a 4% decrease. The adjusted gross profit margin rose to 34.7%. The company incurred a loss of approximately $8 million for the quarter, a significant improvement from the $50 million loss in the third quarter of 2025. For the first nine months of the year, SolarEdge lost $96.5 million, compared to a loss of $273 million in the same period last year.
The forecast for the end of the year is concerning, with projected revenues between $245 million and $275 million, falling short of analyst expectations. The adjusted gross profit margin is expected to be between 17% and 21%, a sharp decrease from the 34.7% achieved in the third quarter.
In an effort to cut high operating costs, SolarEdge began another round of layoffs last week, affecting about 50 employees in Israel. The company's crisis began post-pandemic when European and US distributors accumulated large inventories of solar system components, such as inverters and optimizers, and halted orders due to lower-than-expected demand. SolarEdge's revenues plummeted, and in 2024, the company recorded a net loss of $1.8 billion, which included an inventory write-down.
SolarEdge has since shifted its strategy, closing some operations, including its South Korean subsidiary Kokam, which produced battery cells. The company is now focusing on components for large commercial solar systems and energy management software. It has also entered the market for power conversion systems for data centers, designed to feed AI chip racks. While the company has seen revenue increases and significantly reduced losses in the past year, its recovery from the crisis remains slow, and layoffs continue.
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