Solaredge exceeded analysts' forecasts: Earned $ 69 million in the first quarter of 2022

The Solaredge company significantly exceeded analysts' forecasts, as well as the forecasts it provided to the market regarding its revenues in the first quarter of 2022, under the auspices of a surge in energy prices in the wake of the Ukraine war. However, the company missed earnings per share forecasts, due to the component crisis and the jump in transportation costs. Solaredge released a second-quarter revenue forecast for 2022 that was higher than market forecasts, and its stock responded with a 2% increase in late trading.
Solaredge, managed by Zvi Landau, earned $ 33 million, which is 60 cents a share in the first quarter of 2022 based on US GAAP. Solaredge earned $ 69 million, which is $ 1.20 per share in the first quarter of 2022 based on Non GAAP, that is, after deducting expenses related to the allocation of options to managers and employees and the reduction of intangible assets, is 7 cents per share lower than the average of analysts' forecasts.
Solaredge develops and manufactures direct current converters produced by solar panels for alternating current of the power grid, and also manufactures systems for extracting power from solar panels; Systems for remote monitoring of solar panel performance; Uninterruptible power supplies; Propulsion systems for electric vehicles and lithium-ion batteries.
Solaredge's revenue grew 19% in the first quarter of 2022 compared to the fourth quarter of 2021, and 62% compared to the same quarter in 2021, reaching a record high of $ 655 million - higher than the analysts' average revenue forecast of $ 636 million in the last quarter, And $ 10 million higher than the upper end of the revenue forecast ($ 645-615 million) provided by the company for the first quarter of 2022. Solaredge's revenue in the solar field increased by 21% in the first quarter of 2022 compared to the fourth quarter of 2021 and by 62% compared to For the first quarter of 2021, and totaled $ 608 million - $ 13 million higher than the upper end of the revenue forecast for the solar sector that the company provided ($ 595-575 million) for the past quarter.
The company enjoyed strong 48% growth in its European revenue to $ 285 million - which is 47% of its revenue in the last quarter. This is due to a 40% increase in the domestic sector and 52% in the commercial sector in Europe, although the first quarter is generally weak seasonally. The strong demand, which was reflected in record sales in 14 European countries, including the Netherlands, Italy, Poland and Switzerland, was due to government incentives, for example in Italy, and the rise in electricity prices, as well as the launch of new products. Consumers in Europe seem to have come to the conclusion that investing in a solar energy production and storage system is a good investment given the financial investment alternatives.
Solaredge also grew rapidly in the U.S. market to revenue of $ 282 million, which is 46.4% of its revenue in the first quarter of 2022, thanks in part to a 40% increase in the commercial sector (commercial buildings and land projects for cities and communities) as a result of the jump in electricity prices. Solaredge's revenue outside Europe and the US grew 10% to $ 57 million, up 9.4% from the company's revenue in the past quarter, thanks to strong growth in Israel, Australia, Japan and Taiwan. Landau said the company could grow faster at the rest. The world without the limitations of production capacity.
Part of Solaredge's growth in the past quarter is attributed to a single-digit price increase designed to compensate for some of the increase in component prices and sea and air freight costs. Only about half of the price increase was realized in the first quarter of 2022, because the company did not make price increases on signed orders it had already received. The balance of the effect of the price increase will be reflected in the second and third quarters of 2022.
Non-solar revenues also grew by 62% in the first quarter of 2022 compared to the same quarter in 2021, reaching $ 47 million. The increase in revenue in the non-solar field is due to the doubling of the propulsion systems for the Fiat Docto electric vehicle compared to the fourth quarter of 2021. The company expects a further increase of 30% in the second quarter of 2022.
Solaredge's gross profit grew by only 28% in the first quarter of 2022 compared to the same quarter in 2021, based on US GAAP and amounted to $ 179 million, which is 27.3% of turnover compared to 34.5% From the corresponding turnover in 2021. Gross profitability in the solar sector decreased to 30.2% of revenue in the first quarter of 2022 compared to 32.8% of turnover in the fourth quarter of 2021. Pierre explained that 4.8 percentage points of the 7.2 percentage point erosion in gross profitability is attributed to higher shipping expenses. Part of the need to overcome the delay in the supply chain by flying in the air, in order to meet the schedules that the company has committed to customers and maintain market share.
Other factors in the erosion in gross profitability were incentives that the company paid to its subcontractors in China to continue producing during the Chinese New Year break, an increase in the share of batteries in sales, and the fact that the batteries are characterized by a gross margin of 25%. Another factor in the erosion in profitability was the strong depreciation of the euro against the dollar, which eroded the dollar value of sales in the European market, which is the company's main source of revenue. Solridge expects this trend to continue in the second quarter of 2022.
Gross profitability in the non-solar sector rose to 5.6% of revenue in the first quarter of 2022, compared to 4.2% of turnover in the fourth quarter of 2021, as a result of the increase in battery sales per 100 megawatt hours in the first quarter of 2022, compared to 52 megawatt hours in the fourth quarter of 2021, and a strong increase in sales of electric vehicle propulsion systems. Pierre said at the conference call following the publication of the financial results that the company still estimates that it can return to a gross profitability of 35% -37% in the field of converters and power extracts in the second half of 2022.
Solaredge's non-GAAP operating profit grew by 20% in the first quarter of 2022 compared to the fourth quarter of 2021, and by 21% compared to the same quarter in 2021, and amounted to $ 87 million - which is 13.3% of turnover compared to 17.7 % Of the corresponding turnover in 2021.
Solaredge, managed by Zvi Landau, earned $ 33 million, which is 60 cents a share in the first quarter of 2022 based on US GAAP. Solaredge earned $ 69 million, which is $ 1.20 per share in the first quarter of 2022 based on Non GAAP, that is, after deducting expenses related to the allocation of options to managers and employees and the reduction of intangible assets, is 7 cents per share lower than the average of analysts' forecasts.
Solaredge develops and manufactures direct current converters produced by solar panels for alternating current of the power grid, and also manufactures systems for extracting power from solar panels; Systems for remote monitoring of solar panel performance; Uninterruptible power supplies; Propulsion systems for electric vehicles and lithium-ion batteries.
Solaredge's revenue grew 19% in the first quarter of 2022 compared to the fourth quarter of 2021, and 62% compared to the same quarter in 2021, reaching a record high of $ 655 million - higher than the analysts' average revenue forecast of $ 636 million in the last quarter, And $ 10 million higher than the upper end of the revenue forecast ($ 645-615 million) provided by the company for the first quarter of 2022. Solaredge's revenue in the solar field increased by 21% in the first quarter of 2022 compared to the fourth quarter of 2021 and by 62% compared to For the first quarter of 2021, and totaled $ 608 million - $ 13 million higher than the upper end of the revenue forecast for the solar sector that the company provided ($ 595-575 million) for the past quarter.
The company enjoyed strong 48% growth in its European revenue to $ 285 million - which is 47% of its revenue in the last quarter. This is due to a 40% increase in the domestic sector and 52% in the commercial sector in Europe, although the first quarter is generally weak seasonally. The strong demand, which was reflected in record sales in 14 European countries, including the Netherlands, Italy, Poland and Switzerland, was due to government incentives, for example in Italy, and the rise in electricity prices, as well as the launch of new products. Consumers in Europe seem to have come to the conclusion that investing in a solar energy production and storage system is a good investment given the financial investment alternatives.
Solaredge also grew rapidly in the U.S. market to revenue of $ 282 million, which is 46.4% of its revenue in the first quarter of 2022, thanks in part to a 40% increase in the commercial sector (commercial buildings and land projects for cities and communities) as a result of the jump in electricity prices. Solaredge's revenue outside Europe and the US grew 10% to $ 57 million, up 9.4% from the company's revenue in the past quarter, thanks to strong growth in Israel, Australia, Japan and Taiwan. Landau said the company could grow faster at the rest. The world without the limitations of production capacity.
Part of Solaredge's growth in the past quarter is attributed to a single-digit price increase designed to compensate for some of the increase in component prices and sea and air freight costs. Only about half of the price increase was realized in the first quarter of 2022, because the company did not make price increases on signed orders it had already received. The balance of the effect of the price increase will be reflected in the second and third quarters of 2022.
Non-solar revenues also grew by 62% in the first quarter of 2022 compared to the same quarter in 2021, reaching $ 47 million. The increase in revenue in the non-solar field is due to the doubling of the propulsion systems for the Fiat Docto electric vehicle compared to the fourth quarter of 2021. The company expects a further increase of 30% in the second quarter of 2022.
Solaredge's gross profit grew by only 28% in the first quarter of 2022 compared to the same quarter in 2021, based on US GAAP and amounted to $ 179 million, which is 27.3% of turnover compared to 34.5% From the corresponding turnover in 2021. Gross profitability in the solar sector decreased to 30.2% of revenue in the first quarter of 2022 compared to 32.8% of turnover in the fourth quarter of 2021. Pierre explained that 4.8 percentage points of the 7.2 percentage point erosion in gross profitability is attributed to higher shipping expenses. Part of the need to overcome the delay in the supply chain by flying in the air, in order to meet the schedules that the company has committed to customers and maintain market share.
Other factors in the erosion in gross profitability were incentives that the company paid to its subcontractors in China to continue producing during the Chinese New Year break, an increase in the share of batteries in sales, and the fact that the batteries are characterized by a gross margin of 25%. Another factor in the erosion in profitability was the strong depreciation of the euro against the dollar, which eroded the dollar value of sales in the European market, which is the company's main source of revenue. Solridge expects this trend to continue in the second quarter of 2022.
Gross profitability in the non-solar sector rose to 5.6% of revenue in the first quarter of 2022, compared to 4.2% of turnover in the fourth quarter of 2021, as a result of the increase in battery sales per 100 megawatt hours in the first quarter of 2022, compared to 52 megawatt hours in the fourth quarter of 2021, and a strong increase in sales of electric vehicle propulsion systems. Pierre said at the conference call following the publication of the financial results that the company still estimates that it can return to a gross profitability of 35% -37% in the field of converters and power extracts in the second half of 2022.
Solaredge's non-GAAP operating profit grew by 20% in the first quarter of 2022 compared to the fourth quarter of 2021, and by 21% compared to the same quarter in 2021, and amounted to $ 87 million - which is 13.3% of turnover compared to 17.7 % Of the corresponding turnover in 2021.