• Total Revenue: $3.5 billion, up 2% sequentially, down 23% year over year.
• Gross Margin: 15.7%, up from 11.1% in the previous quarter, down from 19.3% year over year.
• Net Income: $3.2 million.
• Adjusted Net Income: $14.8 million.
• Total Operating Expenses: $539 million, down 1% sequentially, up 20% year over year.
• Cash and Cash Equivalents: $3.2 billion at the end of the third quarter.
• Total Debt: $5.23 billion at the end of the third quarter.
• Net Debt: $2.05 billion at the end of the third quarter.
• AR Turnover Days: 90 days.
• Inventory Turnover Days: 66 days.
• Module Shipments: 25.9 gigawatts in the third quarter.

• Warning! GuruFocus has detected 4 Warning Signs with JKS.

Release Date: October 30, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• JinkoSolar Holding Co Ltd (NYSE:JKS) achieved significant improvements in gross margin, reaching 15.7%, and net income of USD 3.2 million, showing sequential growth.
• The company maintained its global leading position in module shipments, with 25.9 gigawatts shipped in the third quarter, and a strong presence in the US market.
• JinkoSolar's N-type TOPCon technology continues to advance, with mass-produced efficiency improving to approximately 26.2%, reinforcing its competitive edge.
• The company is actively investing in R&D and digital transformation, enhancing its smart production capabilities and integrating advanced technologies like IoT and AI.
• JinkoSolar's commitment to ESG management is evident, with third-party ESG audits completed for most key suppliers and participation in global climate initiatives like the New York Climate Week.

Negative Points

• The imbalance between supply and demand led to continuous price declines in the end market, impacting the entire industrial chain.
• Module exports decreased sequentially in September due to seasonal demand volatility in some overseas markets.
• Total revenue decreased by 23% year over year, primarily due to a decrease in the average selling price of solar modules.
• Operating expenses increased by 20% year over year, driven by higher shipping costs and impairment of long-lived assets.
• The company faces risks related to international trade policies, such as the AD/CVD decision in the US, which could impact future shipments and pricing.

Q & A Highlights

Q: Can you confirm the volume of modules shipped into the US in Q3 and provide the expected megawatts for Q4? A: Gener Miao, Vice President for Global Sales and Marketing, stated that Q3 shipments to the US were roughly 15% to 18% of total shipments. For Q4, the number is expected to be lower due to seasonality and market turbulence, but the total for the year should meet expectations of 5% to 10% of total shipments.

Q: What is your expectation for average selling prices (ASPs) in China and Europe for Q4 relative to Q3? A: Haiyun Cao, Director, mentioned that the ASPs are expected to be moderately downward in Q4 compared to Q3 due to market trends. The blended ASP should be slightly lower in Q4 due to a lower shipment mix in the US.

Q: Can you provide an update on the Storage business and whether it will hit $100 million in revenues this year? A: Gener Miao indicated that it is still early to disclose detailed numbers for the Storage business. The company is working towards ambitious goals and will share updates when ready.

Q: What is the trend in shipping costs per unit, per watt, expected for Q4 and beyond? A: Haiyun Cao explained that logistics costs are expected to be lower starting in Q4 due to sufficient container supply and reduced political tensions impacting costs.

Q: Can you provide details on the free cash flow and CapEx numbers for the quarter? A: Haiyun Cao stated that for the full year 2024, CapEx is estimated at RMB9 billion, operating cash flow at RMB5 billion, resulting in a negative free cash flow of RMB4 billion.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.