SunPower (SPWRA) just turned in a solid quarter blowing away analysts’ expectations on revenue and net income, while missing on gross margins.
It reported GAAP EPS of $.26 versus street estimates of $.14 on revenues of $298 million, compared to street estimates of $263 million.
Compared to the first quarter, revenue and profit were way up. On a year over year basis, they were both down.
The revenue growth was driven by componets sales, which grew to $188.9 million compared to $107.7 million from the year prior.
“Our manufacturing costs are competitive today and we are ahead of plan to achieve our cost reduction goals,” said Tom Werner, SunPower’s CEO.
Gross margins were 19.6% versus expectations of 23.4%. If you exclude amortization of intangible assets, non-cash interest expenses and stock based compensation, the company turned in a gross margin of 22.6%, closer to analyst expectations.
Margins appear to be squeezed by competitors slashing prices. According to the release, “Gross margin for the second quarter was negatively impacted by approximately $12 million from lower factory utilization due to the company’s planned transition to a demand driven manufacturing strategy, which successfully focused on reducing inventory levels.” In other words, SunPower was trying to unload panels.
SunPower’s updated guidance is in line with analyst expecations. The company sees $1.35 billion to $1.7 billion in revenue for the year, and an EPS of $1.15 to $1.60.
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