Press Release
Enphase Energy Reports Financial Results for the Third Quarter of 2022
We reported record quarterly revenue of
Financial highlights for the third quarter of 2022 are listed below.
- Record quarterly revenue of
$634 .7 million - GAAP gross margin of 42.2%; non-GAAP gross margin of 42.9%
- GAAP operating income of
$135 .4 million; non-GAAP operating income of$194 .0 million - GAAP net income of
$114 .8 million; non-GAAP net income of$175 .5 million - GAAP diluted earnings per share of
$0.80 ; non-GAAP diluted earnings per share of$1.25 - Free cash flow of
$179 .1 million; ending cash, cash equivalents, and marketable securities of$1 .42 billion
Our revenue and earnings for the third quarter of 2022 are provided below, compared with the prior quarter and the year ago quarter:
(In thousands, except per share and percentage data)
| GAAP | Non-GAAP | ||||||||||||||||||||||
| Q3 2022 | Q2 2022 | Q3 2021 | Q3 2022 | Q2 2022 | Q3 2021 | ||||||||||||||||||
| Revenue | $ | 634,713 | $ | 530,196 | $ | 351,519 | $ | 634,713 | $ | 530,196 | $ | 351,519 | |||||||||||
| Gross margin | 42.2 | % | 41.3 | % | 39.9 | % | 42.9 | % | 42.2 | % | 40.8 | % | |||||||||||
| Operating expenses | $ | 132,475 | $ | 124,969 | $ | 103,007 | $ | 78,587 | $ | 71,169 | $ | 57,341 | |||||||||||
| Operating income | $ | 135,441 | $ | 94,036 | $ | 37,351 | $ | 193,962 | $ | 152,412 | $ | 85,932 | |||||||||||
| Net income | $ | 114,812 | $ | 76,976 | $ | 21,809 | $ | 175,513 | $ | 149,852 | $ | 84,157 | |||||||||||
| Basic EPS | $ | 0.85 | $ | 0.57 | $ | 0.16 | $ | 1.29 | $ | 1.11 | $ | 0.62 | |||||||||||
| Diluted EPS | $ | 0.80 | $ | 0.54 | $ | 0.15 | $ | 1.25 | $ | 1.07 | $ | 0.60 | |||||||||||
Our total revenue increased 20%, compared to the second quarter of 2022. Demand was strong in our markets worldwide, particularly in
Our non-GAAP operating expenses were
We exited the third quarter of 2022 with
IQ8 Microinverters constituted approximately 47% of all our microinverter shipments during the third quarter of 2022. IQ8 Microinverters can form a microgrid and provide Sunlight Backup™ during an outage, even without a battery. With our Sunlight Jump Start™ feature, IQ8 Microinverters can restart a home energy system using sunlight only after prolonged grid outages that may result in a fully depleted battery. This eliminates the need for a manual restart of the system and gives homeowners greater resilience.
Our IQ Battery shipments were 133.6 megawatt hours in the third quarter of 2022, compared to 132.4 megawatt hours in the second quarter of 2022. We shipped batteries to
We recently acquired
BUSINESS HIGHLIGHTS
On
On
On
In
On
On
In
Enphase Energy recently announced that installers in Hawaii,
FOURTH QUARTER 2022 FINANCIAL OUTLOOK
For the fourth quarter of 2022, Enphase Energy estimates both GAAP and non-GAAP financial results as follows:
- Revenue to be within a range of
$680 million to$720 million , which includes shipments of 120 to 135 megawatt hours of Enphase IQ Batteries - GAAP gross margin to be within a range of 39.0% to 42.0%; non-GAAP gross margin to be within a range of 40.0% to 43.0%, excluding stock-based compensation expenses and acquisition related amortization
- GAAP operating expenses to be within a range of
$152 .0 million to$156 .0 million - Non-GAAP operating expenses to be within a range of
$87.0 million to$91.0 million , excluding$65.0 million estimated for stock-based compensation expenses, restructuring charges for site consolidation, and acquisition related costs and amortization
Follow Enphase Online
- Read the Enphase blog.
- Follow @Enphase on Twitter.
- Visit us on Facebook and LinkedIn.
- Watch Enphase videos on YouTube.
Use of Non-GAAP Financial Measures
Enphase Energy has presented certain non-GAAP financial measures in this press release. To view a description of non-GAAP financial measures used and the non-GAAP reconciliation schedule for the periods presented, click here.
Conference Call Information
Enphase Energy will host a conference call for analysts and investors to discuss its third quarter 2022 results and fourth quarter 2022 business outlook today at
Forward-Looking Statements
This press release contains forward-looking statements, including statements related to Enphase Energy’s expectations as to its fourth quarter of 2022 financial outlook and expense levels; the capabilities, advantages, features and performance of its technology and products; the anticipated benefits of its acquisition of GreenCom Networks; the anticipated demand for and availability of its products and services; and growth in deployments of Enphase Energy Systems. These forward-looking statements are based on Enphase Energy’s current expectations and inherently involve significant risks and uncertainties. Enphase Energy’s actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of certain risks and uncertainties including those risks described in more detail in its most recent Quarterly Report on Form 10-Q for the quarter ended
A copy of this press release can be found on the investor relations page of Enphase Energy’s website at investor.enphase.com.
About
Enphase Energy, a global energy technology company based in
© 2022
Contact:
Investor Relations
ir@enphaseenergy.com
ENPHASE ENERGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||
2022 |
2022 |
2021 |
2022 |
2021 |
|||||||||||||||
| Net revenues | $ | 634,713 | $ | 530,196 | $ | 351,519 | $ | 1,606,201 | $ | 969,330 | |||||||||
| Cost of revenues | 366,797 | 311,191 | 211,161 | 942,307 | 578,222 | ||||||||||||||
| Gross profit | 267,916 | 219,005 | 140,358 | 663,894 | 391,108 | ||||||||||||||
| Operating expenses: | |||||||||||||||||||
| Research and development | 44,188 | 39,256 | 29,411 | 119,163 | 73,937 | ||||||||||||||
| Sales and marketing | 55,257 | 53,588 | 39,296 | 150,189 | 84,504 | ||||||||||||||
| General and administrative | 32,436 | 32,125 | 34,300 | 102,647 | 74,530 | ||||||||||||||
| Restructuring charges | 594 | — | — | 594 | — | ||||||||||||||
| Total operating expenses | 132,475 | 124,969 | 103,007 | 372,593 | 232,971 | ||||||||||||||
| Income from operations | 135,441 | 94,036 | 37,351 | 291,301 | 158,137 | ||||||||||||||
| Other income (expense), net | |||||||||||||||||||
| Interest income | 3,680 | 796 | 110 | 4,936 | 281 | ||||||||||||||
| Interest expense | (2,255 | ) | (2,168 | ) | (12,628 | ) | (7,159 | ) | (32,463 | ) | |||||||||
| Other income (expense), net | (2,611 | ) | (456 | ) | 874 | (5,208 | ) | 814 | |||||||||||
| Loss on partial settlement of convertible notes (1) | — | — | — | — | (56,382 | ) | |||||||||||||
| Total other expense, net | (1,186 | ) | (1,828 | ) | (11,644 | ) | (7,431 | ) | (87,750 | ) | |||||||||
| Income before income taxes | 134,255 | 92,208 | 25,707 | 283,870 | 70,387 | ||||||||||||||
| Income tax benefit (provision) | (19,443 | ) | (15,232 | ) | (3,898 | ) | (40,261 | ) | 22,471 | ||||||||||
| Net income | $ | 114,812 | $ | 76,976 | $ | 21,809 | $ | 243,609 | $ | 92,858 | |||||||||
| Net income per share: | |||||||||||||||||||
| Basic | $ | 0.85 | $ | 0.57 | $ | 0.16 | $ | 1.80 | $ | 0.69 | |||||||||
| Diluted | $ | 0.80 | $ | 0.54 | $ | 0.15 | $ | 1.70 | $ | 0.65 | |||||||||
| Shares used in per share calculation: | |||||||||||||||||||
| Basic | 135,633 | 135,196 | 134,721 | 135,056 | 133,719 | ||||||||||||||
| Diluted | 145,962 | 143,725 | 141,220 | 144,058 | 143,091 | ||||||||||||||
| (1) | Loss on partial settlement of convertible notes of |
ENPHASE ENERGY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
2022 |
2021 |
||||
| ASSETS | |||||
| Current assets: | |||||
| Cash and cash equivalents | $ | 337,583 | $ | 119,316 | |
| Marketable securities | 1,079,713 | 897,335 | |||
| Accounts receivable, net | 367,647 | 333,626 | |||
| Inventory | 146,451 | 74,400 | |||
| Prepaid expenses and other assets | 51,270 | 37,784 | |||
| Total current assets | 1,982,664 | 1,462,461 | |||
| Property and equipment, net | 91,801 | 82,167 | |||
| Operating lease, right of use asset, net | 18,128 | 14,420 | |||
| Intangible assets, net | 90,924 | 97,758 | |||
| 195,508 | 181,254 | ||||
| Other assets | 140,439 | 118,726 | |||
| Deferred tax assets, net | 178,371 | 122,470 | |||
| Total assets | $ | 2,697,835 | $ | 2,079,256 | |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||
| Current liabilities: | |||||
| Accounts payable | $ | 92,823 | $ | 113,767 | |
| Accrued liabilities | 255,800 | 157,912 | |||
| Deferred revenues, current | 79,609 | 62,670 | |||
| Warranty obligations, current | 32,350 | 19,395 | |||
| Debt, current | 89,654 | 86,052 | |||
| Total current liabilities | 550,236 | 439,796 | |||
| Long-term liabilities: | |||||
| Deferred revenues, noncurrent | 239,971 | 187,186 | |||
| Warranty obligations, noncurrent | 73,530 | 53,982 | |||
| Other liabilities | 25,418 | 16,530 | |||
| Debt, noncurrent | 1,198,627 | 951,594 | |||
| Total liabilities | 2,087,782 | 1,649,088 | |||
| Total stockholders’ equity | 610,053 | 430,168 | |||
| Total liabilities and stockholders’ equity | $ | 2,697,835 | $ | 2,079,256 | |
ENPHASE ENERGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||
2022 |
2022 |
2021 |
2022 |
2021 |
|||||||||||||||
| Cash flows from operating activities: | |||||||||||||||||||
| Net income | $ | 114,812 | $ | 76,976 | $ | 21,809 | $ | 243,609 | $ | 92,858 | |||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||||||
| Depreciation and amortization | 14,664 | 13,999 | 8,255 | 42,766 | 21,409 | ||||||||||||||
| Amortization of marketable securities premiums, net of accretion of purchase discounts | (612 | ) | 1,248 | 58 | 2,091 | 58 | |||||||||||||
| Provision for doubtful accounts | (79 | ) | (16 | ) | 179 | 52 | 450 | ||||||||||||
| Asset impairment | — | 1,200 | — | 1,200 | — | ||||||||||||||
| Loss on partial settlement of convertibles notes | — | — | — | — | 56,382 | ||||||||||||||
| Deemed repayment of convertible notes attributable to accreted debt discount | — | — | — | — | (15,585 | ) | |||||||||||||
| Non-cash interest expense | 2,065 | 2,046 | 12,430 | 6,090 | 31,893 | ||||||||||||||
| Change in fair value of debt securities | (519 | ) | (987 | ) | (784 | ) | (390 | ) | (3,153 | ) | |||||||||
| Stock-based compensation | 52,296 | 53,064 | 46,954 | 153,157 | 77,110 | ||||||||||||||
| Deferred income taxes | 115 | 12,452 | 1,337 | 15,732 | (28,790 | ) | |||||||||||||
| Changes in operating assets and liabilities: | |||||||||||||||||||
| Accounts receivable | (46,226 | ) | 51,770 | 5,462 | (18,680 | ) | (93,069 | ) | |||||||||||
| Inventory | (16,185 | ) | (33,830 | ) | (27,648 | ) | (72,051 | ) | (23,640 | ) | |||||||||
| Prepaid expenses and other assets | 526 | (18,310 | ) | (3,568 | ) | (20,826 | ) | (18,762 | ) | ||||||||||
| Accounts payable, accrued and other liabilities | 32,060 | 12,033 | 24,897 | 42,288 | 71,787 | ||||||||||||||
| Warranty obligations | 9,329 | 12,972 | 7,574 | 32,207 | 21,599 | ||||||||||||||
| Deferred revenues | 25,764 | 16,033 | 16,399 | 63,858 | 64,308 | ||||||||||||||
| Net cash provided by operating activities | 188,010 | 200,650 | 113,354 | 491,103 | 254,855 | ||||||||||||||
| Cash flows from investing activities: | |||||||||||||||||||
| Purchases of property and equipment | (8,948 | ) | (8,691 | ) | (12,682 | ) | (30,014 | ) | (39,050 | ) | |||||||||
| Purchases of marketable securities | (512,176 | ) | (60,061 | ) | (545,490 | ) | (572,237 | ) | (545,490 | ) | |||||||||
| Maturities of marketable securities | 184,123 | 116,298 | 35,000 | 377,156 | 35,000 | ||||||||||||||
| Investments in private companies | (1,000 | ) | — | (13,000 | ) | (1,000 | ) | (58,000 | ) | ||||||||||
| Business acquisitions, net of cash acquired | — | (3,055 | ) | — | (27,680 | ) | (55,239 | ) | |||||||||||
| Purchase of intangible asset | — | — | (250 | ) | — | (250 | ) | ||||||||||||
| Net cash provided by (used in) investing activities | (338,001 | ) | 44,491 | (536,422 | ) | (253,775 | ) | (663,029 | ) | ||||||||||
| Cash flows from financing activities: | |||||||||||||||||||
| Issuance of convertible notes, net of issuance costs | — | — | — | — | 1,188,439 | ||||||||||||||
| Purchase of convertible note hedges | — | — | — | — | (286,235 | ) | |||||||||||||
| Sale of warrants | — | — | — | — | 220,800 | ||||||||||||||
| Principal payments and financing fees on debt | — | — | — | — | (1,422 | ) | |||||||||||||
| Partial repurchase of convertible notes | — | — | — | — | (289,312 | ) | |||||||||||||
| Repurchase of common stock | — | — | — | — | (200,000 | ) | |||||||||||||
| Proceeds from exercise of equity awards and employee stock purchase plan | 693 | 4,183 | 42 | 5,280 | 3,684 | ||||||||||||||
| Payment of withholding taxes related to net share settlement of equity awards | (4,589 | ) | (5,463 | ) | (3,313 | ) | (19,396 | ) | (20,311 | ) | |||||||||
| Net cash provided by (used in) financing activities | (3,896 | ) | (1,280 | ) | (3,271 | ) | (14,116 | ) | 615,643 | ||||||||||
| Effect of exchange rate changes on cash and cash equivalents | (4,003 | ) | (238 | ) | (376 | ) | (4,945 | ) | (1,302 | ) | |||||||||
| Net increase (decrease) in cash and cash equivalents | (157,890 | ) | 243,623 | (426,715 | ) | 218,267 | 206,167 | ||||||||||||
| Cash and cash equivalents—Beginning of period | 495,473 | 251,850 | 1,312,261 | 119,316 | 679,379 | ||||||||||||||
| Cash and cash equivalents —End of period | $ | 337,583 | $ | 495,473 | $ | 885,546 | $ | 337,583 | $ | 885,546 | |||||||||
ENPHASE ENERGY, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(In thousands, except per share data and percentages)
(Unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||
2022 |
2022 |
2021 |
2022 |
2021 |
|||||||||||||||
| Gross profit (GAAP) | $ | 267,916 | $ | 219,005 | $ | 140,358 | $ | 663,894 | $ | 391,108 | |||||||||
| Stock-based compensation | 3,188 | 3,131 | 2,915 | 8,826 | 4,957 | ||||||||||||||
| Acquisition related amortization | 1,445 | 1,445 | — | 4,189 | — | ||||||||||||||
| Gross profit (Non-GAAP) | $ | 272,549 | $ | 223,581 | $ | 143,273 | $ | 676,909 | $ | 396,065 | |||||||||
| Gross margin (GAAP) | 42.2 | % | 41.3 | % | 39.9 | % | 41.3 | % | 40.3 | % | |||||||||
| Stock-based compensation | 0.5 | % | 0.6 | % | 0.9 | % | 0.5 | % | 0.6 | % | |||||||||
| Acquisition related amortization | 0.2 | % | 0.3 | % | — | % | 0.3 | % | — | % | |||||||||
| Gross margin (Non-GAAP) | 42.9 | % | 42.2 | % | 40.8 | % | 42.1 | % | 40.9 | % | |||||||||
| Operating expenses (GAAP) | $ | 132,475 | $ | 124,969 | $ | 103,007 | $ | 372,593 | $ | 232,971 | |||||||||
| Stock-based compensation (1) | (49,108 | ) | (49,933 | ) | (44,039 | ) | (144,331 | ) | (72,153 | ) | |||||||||
| Acquisition related expenses and amortization | (4,186 | ) | (3,867 | ) | (1,627 | ) | (11,662 | ) | (8,082 | ) | |||||||||
| Restructuring and asset impairment charges | (594 | ) | — | — | (594 | ) | — | ||||||||||||
| Operating expenses (Non-GAAP) | $ | 78,587 | $ | 71,169 | $ | 57,341 | $ | 216,006 | $ | 152,736 | |||||||||
| (1) Includes stock-based compensation as follows: | |||||||||||||||||||
| Research and development | $ | 17,400 | $ | 16,266 | $ | 10,999 | $ | 47,395 | $ | 22,215 | |||||||||
| Sales and marketing | 20,069 | 22,176 | 15,472 | 55,302 | 24,344 | ||||||||||||||
| General and administrative | 11,639 | 11,491 | 17,568 | 41,634 | 25,594 | ||||||||||||||
| Total | $ | 49,108 | $ | 49,933 | $ | 44,039 | $ | 144,331 | $ | 72,153 | |||||||||
| Income from operations (GAAP) | $ | 135,441 | $ | 94,036 | $ | 37,351 | $ | 291,301 | $ | 158,137 | |||||||||
| Stock-based compensation | 52,296 | 53,064 | 46,954 | 153,157 | 77,110 | ||||||||||||||
| Acquisition related expenses and amortization | 5,631 | 5,312 | 1,627 | 15,851 | 8,082 | ||||||||||||||
| Restructuring and asset impairment charges | 594 | — | — | 594 | — | ||||||||||||||
| Income from operations (Non-GAAP) | $ | 193,962 | $ | 152,412 | $ | 85,932 | $ | 460,903 | $ | 243,329 | |||||||||
| Net income (GAAP) | $ | 114,812 | $ | 76,976 | $ | 21,809 | $ | 243,609 | $ | 92,858 | |||||||||
| Stock-based compensation | 52,296 | 53,064 | 46,954 | 153,157 | 77,110 | ||||||||||||||
| Acquisition related expenses and amortization | 5,631 | 5,312 | 1,627 | 15,851 | 8,082 | ||||||||||||||
| Restructuring and asset impairment charges | 594 | — | — | 594 | — | ||||||||||||||
| Non-cash interest expense | 2,065 | 2,048 | 12,430 | 6,092 | 31,893 | ||||||||||||||
| Loss on partial settlement of convertible notes | — | — | — | — | 56,382 | ||||||||||||||
| Non-GAAP income tax adjustment | 115 | 12,452 | 1,337 | 15,732 | (28,790 | ) | |||||||||||||
| Net income (Non-GAAP) | $ | 175,513 | $ | 149,852 | $ | 84,157 | $ | 435,035 | $ | 237,535 | |||||||||
| Net income per share, basic (GAAP) | $ | 0.85 | $ | 0.57 | $ | 0.16 | $ | 1.80 | $ | 0.69 | |||||||||
| Stock-based compensation | 0.39 | 0.39 | 0.35 | 1.13 | 0.58 | ||||||||||||||
| Acquisition related expenses and amortization | 0.04 | 0.04 | 0.01 | 0.12 | 0.06 | ||||||||||||||
| Restructuring and asset impairment charges | — | — | — | — | — | ||||||||||||||
| Non-cash interest expense | 0.01 | 0.02 | 0.09 | 0.05 | 0.24 | ||||||||||||||
| Loss on partial settlement of convertible notes | — | — | — | — | 0.42 | ||||||||||||||
| Non-GAAP income tax adjustment | — | 0.09 | 0.01 | 0.12 | (0.21 | ) | |||||||||||||
| Net income per share, basic (Non-GAAP) | $ | 1.29 | $ | 1.11 | $ | 0.62 | $ | 3.22 | $ | 1.78 | |||||||||
| Shares used in basic per share calculation GAAP and Non-GAAP | 135,633 | 135,196 | 134,721 | 135,056 | 133,719 | ||||||||||||||
| Net income per share, diluted (GAAP) | $ | 0.80 | $ | 0.54 | $ | 0.15 | $ | 1.70 | $ | 0.65 | |||||||||
| Stock-based compensation | 0.37 | 0.38 | 0.34 | 1.11 | 0.55 | ||||||||||||||
| Acquisition related expenses and amortization | 0.05 | 0.04 | 0.01 | 0.12 | 0.06 | ||||||||||||||
| Restructuring and asset impairment charges | 0.01 | — | — | 0.01 | — | ||||||||||||||
| Non-cash interest expense | 0.02 | 0.02 | 0.09 | 0.05 | 0.23 | ||||||||||||||
| Loss on partial settlement of convertible notes | — | — | — | — | 0.40 | ||||||||||||||
| Non-GAAP income tax adjustment | — | 0.09 | 0.01 | 0.12 | (0.21 | ) | |||||||||||||
| Net income per share, diluted (Non-GAAP) (2) | $ | 1.25 | $ | 1.07 | $ | 0.60 | $ | 3.11 | $ | 1.68 | |||||||||
| Shares used in diluted per share calculation GAAP | 145,962 | 143,725 | 141,220 | 144,058 | 143,091 | ||||||||||||||
| Shares used in diluted per share calculation Non-GAAP (3) | 140,634 | 139,650 | 140,516 | 139,983 | 141,101 | ||||||||||||||
| Net cash provided by operating activities (GAAP) | $ | 188,010 | $ | 200,650 | $ | 113,354 | $ | 491,103 | $ | 254,855 | |||||||||
| Purchases of property and equipment | (8,948 | ) | (8,691 | ) | (12,682 | ) | (30,014 | ) | (39,050 | ) | |||||||||
| Deemed repayment of convertible notes due 2024 and notes due 2025 attributable to accreted debt discount | — | — | — | — | 15,585 | ||||||||||||||
| Free cash flow (Non-GAAP) | $ | 179,062 | $ | 191,959 | $ | 100,672 | $ | 461,089 | $ | 231,390 | |||||||||
| (2) | Calculation of non-GAAP diluted net income per share for the three months ended |
| (3) | Effect of dilutive in-the-money portion of convertible senior notes and warrants are included in the GAAP weighted-average diluted shares in periods where we have GAAP net income. We excluded the in-the-money portion of convertible notes due 2024 totaling 46 thousand shares and 1,014 thousand shares in the three months and nine months ended |
Source: Enphase Energy, Inc.