• Total Revenue: $196.2 million for Q4 2024.
• Solar Segment Revenue: $189 million.
• US Solar Revenue: $114 million, representing 60% of solar revenues.
• European Solar Revenue: $44.8 million, representing 24% of solar revenues.
• International Solar Revenue: $30.3 million, representing 16% of solar revenues.
• Total Megawatt Shipments: 895 megawatts.
• Battery Shipments: 130-megawatt hours, primarily to Europe.
• ASP per Watt (excluding batteries): $20.8, up 2% from Q3.
• Blended ASP per kWh on PV Attached Batteries: $262, down from $317 in Q3.
• Non-Solar Business Revenue: $6.9 million.
• GAAP Gross Margin: Negative 57.2% for Q4.
• Non-GAAP Gross Margin: 39.5% for Q4.
• Non-GAAP Operating Expenses: $106.8 million for Q4.
• GAAP Net Loss: $287.4 million for Q4.
• Non-GAAP Net Loss: $202.5 million for Q4.
• Net Loss per Share: $5 for Q4.
• Non-GAAP Net Loss per Share: $3.52 for Q4.
• Free Cash Flow: $26 million for Q4.
• Cash and Equivalents: Approximately $767 million as of December 31, 2024.
• Inventory Level: $645.9 million, net of reserves.
• Q1 2025 Revenue Guidance: $195 million to $215 million.
• Q1 2025 Non-GAAP Gross Margin Guidance: 6% to 10%.
• Q1 2025 Non-GAAP Operating Expenses Guidance: $98 million to $103 million.

• Warning! GuruFocus has detected 8 Warning Signs with SEDG.

Release Date: February 19, 2025

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

Positive Points

• SolarEdge Technologies Inc (NASDAQ:SEDG) generated approximately $26 million in free cash flow in Q4 2024, exceeding forecasts.
• The company is ramping up US manufacturing, creating nearly 2,000 jobs and increasing production capacity for inverters and optimizers.
• SolarEdge Technologies Inc (NASDAQ:SEDG) is focusing on innovation with the introduction of new products like the SolarEdge ONE Controller and the Nexus residential portfolio.
• The company has strengthened its financial position by selling 45X advanced manufacturing production credits, enhancing liquidity.
• SolarEdge Technologies Inc (NASDAQ:SEDG) is implementing cost-saving measures, including headcount reductions and focusing on core projects, to improve operational efficiency.

Negative Points

• SolarEdge Technologies Inc (NASDAQ:SEDG) reported disappointing financial results in recent quarters, with a GAAP net loss of $287.4 million in Q4 2024.
• The company faced a $115 million inventory write-down due to weaker-than-expected recovery in the European market.
• There is uncertainty in the US market due to potential policy changes, impacting sales and market conditions.
• SolarEdge Technologies Inc (NASDAQ:SEDG) had to revise previously reported revenues and loans receivables, impacting financial statements.
• The European market remains challenged with macroeconomic headwinds, and the company expects a slight market decline in 2025.

Q & A Highlights

Q: What level of free cash flow should we expect in Q1, and what's the strategy for addressing debt maturity? A: Ariel Porat, CFO, stated that while they are not guiding for the second half or full year, they are confident about being cash flow positive in Q1. The strategy for debt maturity involves potentially paying it out from the balance sheet, as they have enough cash and are generating free cash flow sooner than expected.

Q: Can you explain the gap between revenue and sell-through, and when do you expect them to converge? A: Shuki Nir, CEO, explained that the gap is mainly due to channel inventory levels in Europe. They expect the sell-in and sell-out to converge by the end of the second quarter as inventory levels normalize.

Q: How should we think about the cadence of future 45X monetizations in 2025? A: Ariel Porat, CFO, mentioned that they believe they can sell the accumulated IRA tax credits in the following quarter, depending on market demand. They have successfully monetized these credits twice in Q4.

Q: What are the expectations for the European market in 2025? A: Shuki Nir, CEO, indicated that the European market is expected to slightly decline this year. However, SolarEdge aims to gain market share despite the overall market contraction.

Q: Can you provide more context on the restricted cash disclosure of $135 million? A: Ariel Porat, CFO, explained that part of the restricted cash is related to Safe Harbor agreements, while some is set aside for commercial agreements with customers and vendors.

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