First Solar Beats EPS but Misses Revenue; Shares Edge Higher After Hours

Earnings Summary

First Solar delivered a solid top‑line growth story, with net sales up 24% year‑over‑year to $1.04 billion, driven by higher module volumes and record sales in India. Net income surged 65% to $347 million, translating to GAAP EPS of $3.22, a $0.14 beat over the $3.08 consensus. Adjusted EBITDA rose to $520 million, comfortably above the top end of the company’s preview range. The only blemish was a modest revenue miss; analysts had penciled in $1.05 billion, leaving the company about $10 million short.

Guidance & Outlook

Management reaffirmed its 2026 outlook, projecting full‑year net sales between $4.9 billion and $5.2 billion, gross profit of $2.4‑$2.6 billion, and Adjusted EBITDA of $2.6‑$2.8 billion. Capital expenditures are expected to stay in the $0.8‑$1.0 billion range, while the net cash balance should sit between $1.7 billion and $2.3 billion. The guidance assumes Section 45X tax credits of $2.10‑$2.19 billion and under‑utilization costs of $115‑$155 million, underscoring the company’s reliance on U.S. policy incentives.

Conference Call Highlights

CEO Mark Widmar highlighted “record first‑quarter revenue, record sales in India, meaningful margin expansion, and Adjusted EBITDA above the top end of our preview range.” He emphasized the competitive edge provided by the company’s thin‑film technology and its domestic manufacturing footprint, which insulates First Solar from Chinese crystalline‑silicon supply‑chain disruptions. However, the call also flagged ongoing tariff and policy uncertainty, noting that any shift in the Inflation Reduction Act or trade remedies could pressure margins.

Market Reaction & Analyst Take

The after‑hours market responded positively, with the stock climbing $1.06 to $202.95, a 0.53% gain. Analysts at Bloomberg and Jefferies praised the EPS beat and the reaffirmed guidance, but warned that the slight revenue miss and softer full‑year outlook could cap upside. A Bloomberg note highlighted “tariff and policy uncertainty” as a headwind, while Simply Wall St observed that “softer guidance may change the case for the stock,” suggesting a cautious stance despite the earnings beat. Overall, the consensus remains neutral‑to‑buy, with price targets nudged modestly higher to reflect the strong cash position and growth outlook.

Sector Context

First Solar’s results come as the U.S. utility‑scale solar pipeline expands, buoyed by the Inflation Reduction Act’s tax credits and a surge in domestic project financing. The company’s focus on thin‑film PV technology differentiates it from crystalline‑silicon peers, offering higher temperature performance and lower balance‑of‑system costs. With a 47.9 GW backlog as of March 31, First Solar is well‑positioned to capture a growing share of the renewable‑energy transition, provided policy support remains stable.

Looking ahead, investors will watch the Q2 results for module‑sale volumes (3.4‑4.0 GW) and the impact of Section 45X tax credits, which are expected to range between $330 million and $400 million. Any shift in U.S. trade policy or tax‑credit structures could materially affect the company’s margin trajectory and cash generation.