Both First Solar and SunPower's third-quarter earnings call took place today at the close of the market. First Solar had pre-announced their results last week and both firms had cut their 2011 revenue guidance prior to today's calls.

First Solar

First Solar (Nasdaq: FSLR) recently saw the sudden announcement of CEO Rob Gillette leaving the firm. The CEO transition was carried out in a surprisingly (especially for the usually predictable First Solar) sloppy manner.

New CEO Mike Ahearn led off the call with some strong language, saying that inertia was holding them back and there was too much of a fixation on short-term earnings per share. Ahearn reinforced First Solar's commitment to create a product that can generate power economically in non-subsidized markets.

  • The French factory is on indefinite hold, the Vietnam factory build has been suspended
  • There's optimism with the Indian market
  • First Solar introduced an 87-watt module
  • Current cost is $0.74 per watt and expected to reach the mid $0.60s in 2012
  • Gross profit in Q3 was 37.7 percent
  • Average efficiency crept up another 0.1 percent this quarter
  • The average capacity per line reached 70 megawatts

Net sales were $1,006 million in the quarter, an increase of $473 million from the second quarter of 2011. Quarterly net sales increased from $798 million in the third quarter of 2010.

Updated Guidance

Last quarter, First Solar cut 2011 revenue guidance to $3.6 billion to $3.7 billion and expressed optimism about the second half of this year. Rob Gillette, the now-former CEO of First Solar, said in the earnings statement: “We expect stronger performance in the second half of 2011 as we build projects from our systems pipeline, develop promising new markets, execute our cost reduction roadmaps and continue to improve module efficiencies.”

But guidance for the year has now been cut to net sales of $3.0 billion to $3.3 billion.

Still, the markets seemed happy with the cost savings plans.




First Solar stock price as of 4 p.m. Eastern Time from Google Finance.




Key milestones since the second quarter of 2011:

  • Started construction of the 250-megawatt California Valley Solar Ranch, which was sold to NRG; also settled outstanding litigation related to the project
  • Launched new C7 concentrator tracking system for power plants and AC solar panels for the residential market
  • Partnered with Ford Motor Company to offer Ford Focus Electric car owners high-efficiency SunPower systems to offset the energy used in charging the vehicle

SunPower also just announced that its CFO, Dennis Arriola, will be leaving the firm in March of 2012 and that Jim Pape, President of the Residential and Commercial division, will leave later this month.

2011 Financial Outlook

For fiscal year 2011, the company expects the following GAAP results:

  • Revenue of $2.30 billion to $2.35 billion, down from a range of $2.8 billion to $2.95 billion
  • Gross margin of 9 percent to 11 percent
  • Megawatts recognized in the range of 790 megawatts to 815 megawatts.  

Markets were not as happy with SunPower's call.

SunPower stock price as of 4 p.m. Eastern Time from Google Finance.