• Enphase Energy Reports Financial Results for the Second Quarter of 2022

    ソース: Nasdaq GlobeNewswire / 26 7 2022 15:05:01   America/Chicago

    FREMONT, Calif., July 26, 2022 (GLOBE NEWSWIRE) -- Enphase Energy, Inc. (NASDAQ: ENPH), a global energy technology company and the world’s leading supplier of microinverter-based solar and battery systems, announced today financial results for the second quarter of 2022, which included the summary below from its President and CEO, Badri Kothandaraman.

    We reported record quarterly revenue of $530.2 million in the second quarter of 2022, along with 42.2% for non-GAAP gross margin. We shipped 3,348,553 microinverters, or approximately 1,213 megawatts DC, and 132.4 megawatt hours of Enphase® IQ™ Batteries.

    Financial highlights for the second quarter of 2022 are listed below.

    • Record quarterly revenue of $530.2 million
    • GAAP gross margin of 41.3%; non-GAAP gross margin of 42.2%
    • GAAP operating income of $94.0 million; non-GAAP operating income of $152.4 million
    • GAAP net income of $77.0 million; non-GAAP net income of $149.9 million
    • GAAP diluted earnings per share of $0.54; non-GAAP diluted earnings per share of $1.07
    • Free cash flow of $192.0 million; ending cash, cash equivalents, and marketable securities of $1.25 billion

    Our revenue and earnings for the second 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
     Q2 2022 Q1 2022 Q2 2021 Q2 2022 Q1 2022 Q2 2021
    Revenue$530,196  $441,292  $316,057  $530,196  $441,292  $316,057 
    Gross margin 41.3%  40.1%  40.4%  42.2%  41.0%  40.8%
    Operating expenses$124,969  $115,149  $68,401  $71,169  $66,250  $51,696 
    Operating income$94,036  $61,824  $59,400  $152,412  $114,529  $77,165 
    Net income$76,976  $51,821  $39,351  $149,852  $109,670  $74,676 
    Basic EPS$0.57  $0.39  $0.29  $1.11  $0.82  $0.55 
    Diluted EPS$0.54  $0.37  $0.28  $1.07  $0.79  $0.53 

    Our total revenue increased 20%, compared to the first quarter of 2022. Our microinverter shipments were up 18%, compared to the first quarter of 2022. Our IQ Battery shipments were up 10%, compared to the first quarter of 2022. Our non-GAAP gross margin was 42.2% in the second quarter of 2022, compared to 41.0% in the first quarter of 2022, driven by a favorable product mix.

    Our non-GAAP operating expenses were $71.2 million in the second quarter of 2022, compared to $66.3 million in the first quarter of 2022, primarily due to increased investment in R&D, customer service, sales, and IT infrastructure. Our non-GAAP operating income was $152.4 million in the second quarter of 2022, compared to $114.5 million in the first quarter of 2022.

    We exited the second quarter of 2022 with $1.25 billion in cash, cash equivalents, and marketable securities and generated $200.7 million in cash flow from operations in the second quarter of 2022. Our capital expenditures were $8.7 million in the second quarter of 2022, compared to $12.4 million in the first quarter of 2022.

    Our quarterly revenue in the second quarter of 2022 was driven by strong demand for Enphase Energy Systems, powered by IQ® Microinverters and IQ Batteries. IQ8™ Microinverters constituted 37% of all our microinverter shipments during the second quarter. The grid-forming IQ8 Microinverters can provide Sunlight Backup™ during an outage, even without a battery. And, with the 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.

    Our IQ Battery shipments increased to 132.4 megawatt hours in the second quarter of 2022, compared to 120.4 megawatt hours in the first quarter of 2022. We shipped batteries to the United States, Germany, and Belgium during the second quarter, and made updates to improve the installer and homeowner experience. We now have more than 1,600 installers worldwide that are certified to install our IQ Batteries.

    Our revenue in Europe for the second quarter of 2022 increased 69%, compared to the first quarter of 2022, led by strong growth in the Netherlands and Germany. Homeowners want self-consumption as the region not only faces rising energy prices but also a growing demand for home electrification driven by EVs and natural gas shortages. We expect to introduce IQ Batteries in more European countries during the second half of 2022.

    Our strategy is to build best-in-class home energy systems and deliver them to homeowners through our installer and distribution partners, enabled by an installer platform. We have completed five acquisitions in the last six quarters, one for EV chargers and four to help create our installer platform. We shipped more than 8,250 ClipperCreek EV chargers to U.S. customers in the second quarter of 2022 and expect healthy growth going forward. We are working to move production to our manufacturing partner in Mexico, making our chargers smart and integrating the EV chargers into our home energy management systems.

    We recently acquired SolarLeadFactory LLC to provide high-quality leads to our installers and further strengthen our installer platform. In January 2021, we acquired Sofdesk Inc. to provide solar design software capability and approximately 950 installers are using the Solargraf software. We acquired a business in Noida, India in March 2021 to provide proposal and permitting services for installers and are focused on automating these services. In December 2021, we acquired 365 Pronto, Inc. to simplify maintenance for installers by matching cleantech asset owners to a local and on-demand workforce of service providers. All four acquisitions aim to make life simpler for installers by providing them high-quality products and services, ultimately reducing their soft costs.

    BUSINESS HIGHLIGHTS

    On April 19, 2022, Enphase Energy announced that ADT Solar™, formerly Sunpro Solar, a leading rooftop solar provider and one of the fastest-growing residential solar-plus-storage service providers across 22 states in the United States, is now exclusively offering Enphase IQ8 Microinverters as part of its comprehensive home energy solution.

    On May 9, 2022, Enphase Energy announced that Enphase IQ Batteries now officially support the most common third-party string inverters in Belgium and Germany, helping meet the increasing demand for energy independence in the region. Since the 2021 launch of the IQ Battery in Belgium and Germany, installers of Enphase products have seen increasing deployments of Enphase Energy Systems powered by IQ Microinverters and Enphase IQ Batteries, as well as residential solar-only energy systems powered by IQ7™, IQ7+™, and IQ7A™ Microinverters.

    On May 23, 2022, Enphase Energy announced that the Enphase IQ8 Microinverter system is the first in the world to be certified by UL, a global safety science leader, to UL 1741, 3rd edition including the Supplement SB. This certification meets the new North American safety and grid interconnection standards for connecting solar inverters, energy storage systems, and distributed energy resources to the grid in compliance with IEEE 1547-2018 and IEEE 1547-1 2020.

    Enphase Energy recently announced that installers in Rhode Island, Massachusetts, Washington, New Mexico, Texas, New York, Florida, Hawaii, Missouri, Michigan, Southern California, and Puerto Rico have seen growing deployments of the Enphase Energy System powered by IQ Microinverters and IQ Batteries.

    THIRD QUARTER 2022 FINANCIAL OUTLOOK

    For the third quarter of 2022, Enphase Energy estimates both GAAP and non-GAAP financial results as follows:

    • Revenue to be within a range of $590 million to $630 million, which includes shipments of 130 to 145 megawatt hours of Enphase IQ Batteries
    • GAAP gross margin to be within a range of 38.0% to 41.0%; non-GAAP gross margin to be within a range of 39.0% to 42.0%, excluding stock-based compensation expenses and acquisition related amortization
    • GAAP operating expenses to be within a range of $137.0 million to $141.0 million
    • Non-GAAP operating expenses to be within a range of $77.0 million to $81.0 million, excluding $60.0 million estimated for stock-based compensation expenses and acquisition related costs and amortization

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    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 second quarter 2022 results and third quarter 2022 business outlook today at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time). The call is open to the public by dialing (833) 634-5018. A live webcast of the conference call will also be accessible from the “Investor Relations” section of Enphase Energy’s website at investor.enphase.com. Following the webcast, an archived version will be available on the website for approximately one year. In addition, an audio replay of the conference call will be available by calling (877) 344-7529; replay access code 9407506, beginning approximately one hour after the call.

    Forward-Looking Statements

    This press release contains forward-looking statements, including statements related to Enphase Energy’s expectations as to its third quarter of 2022 financial outlook and expense levels; the capabilities, advantages, features and performance of its technology and products; its business strategies and anticipated demand for and availability of its products and services; market demand for residential solar and battery deployments; 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 March 31, 2022, its most recent Annual Report on Form 10-K for the year ended December 31, 2021 and other documents on file with the SEC from time to time and available on the SEC’s website at www.sec.gov. Enphase Energy undertakes no duty or obligation to update any forward-looking statements contained in this release as a result of new information, future events or changes in its expectations, except as required by law.

    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, Inc.

    Enphase Energy, a global energy technology company based in Fremont, CA, is the world's leading supplier of microinverter-based solar and battery systems that enable people to harness the sun to make, use, save, and sell their own power—and control it all with a smart mobile app. The company revolutionized the solar industry with its microinverter-based technology and builds all-in-one solar, battery, and software solutions. Enphase has shipped more than 48 million microinverters, and over 2.5 million Enphase-based systems have been deployed in more than 140 countries. For more information, visit www.enphase.com.

    © 2022 Enphase Energy, Inc. All rights reserved. Enphase Energy, Enphase, the “e” logo, IQ, IQ7, IQ7+, IQ7A, IQ8, Sunlight Backup, Sunlight Jump Start, and certain other names and marks are trademarks of Enphase Energy, Inc. Other names are for informational purposes and may be trademarks of their respective owners.

    Contact:

    Karen Sagot
    Enphase Energy, Inc.
    Investor Relations
    ir@enphaseenergy.com

    ENPHASE ENERGY, INC. 
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS 
    (In thousands, except per share data)
    (Unaudited)

     Three Months EndedSix Months Ended
     June 30,
    2022    		 March 31,
    2022    		 June 30,
    2021    		 June 30,
    2022    		 June 30,
    2021
    Net revenues$530,196  $441,292  $316,057  $971,488  $617,811 
    Cost of revenues 311,191   264,319   188,256   575,510   367,061 
    Gross profit 219,005   176,973   127,801   395,978   250,750 
    Operating expenses:         
    Research and development 39,256   35,719   22,708   74,975   44,526 
    Sales and marketing 53,588   41,344   25,586   94,932   45,208 
    General and administrative 32,125   38,086   20,107   70,211   40,230 
    Total operating expenses 124,969   115,149   68,401   240,118   129,964 
    Income from operations 94,036   61,824   59,400   155,860   120,786 
    Other income (expense), net         
    Interest income 796   460   98   1,256   171 
    Interest expense (2,168)  (2,736)  (12,506)  (4,904)  (19,835)
    Other income (expense), net (456)  (2,141)  (633)  (2,597)  (60)
    Loss on partial settlement of convertible notes (1) —   —   (13)  —   (56,382)
    Total other expense, net (1,828)  (4,417)  (13,054)  (6,245)  (76,106)
    Income before income taxes 92,208   57,407   46,346   149,615   44,680 
    Income tax benefit (provision) (15,232)  (5,586)  (6,995)  (20,818)  26,369 
    Net income$76,976  $51,821  $39,351  $128,797  $71,049 
    Net income per share:         
    Basic$0.57  $0.39  $0.29  $0.96  $0.53 
    Diluted$0.54  $0.37  $0.28  $0.91  $0.49 
    Shares used in per share calculation:         
    Basic 135,196   134,327   135,094   134,768   133,209 
    Diluted 143,725   144,617   141,533   143,602   144,022 


    (1)Loss on partial settlement of convertible notes of less than $0.1 million for the three months ended June 30, 2021, primarily relates to the non-cash loss on partial settlement of $0.1 million aggregate principal amount of the Notes due 2025. Loss on partial settlement of convertible notes of $56.4 million for the six months ended June 30, 2021, primarily relates to the $9.5 million non-cash loss on partial settlement of $87.1 million aggregate principal amount of the Notes due 2024, $9.5 million non-cash loss on partial settlement of $217.8 million aggregate principal amount of the Notes due 2025 and $37.5 million non-cash inducement loss incurred on repurchase of Notes due 2025.

    ENPHASE ENERGY, INC. 
    CONDENSED CONSOLIDATED BALANCE SHEETS 
    (In thousands) 
    (Unaudited)

     June 30, 
    2022    		 December 31, 
    2021
    ASSETS   
    Current assets:   
    Cash and cash equivalents$495,473 $119,316
    Marketable securities 752,328  897,335
    Accounts receivable, net 312,451  333,626
    Inventory 130,266  74,400
    Prepaid expenses and other assets 45,474  37,784
    Total current assets 1,735,992  1,462,461
    Property and equipment, net 86,778  82,167
    Operating lease, right of use asset, net 16,987  14,420
    Intangible assets, net 96,887  97,758
    Goodwill 197,004  181,254
    Other assets 129,153  118,726
    Deferred tax assets, net 174,307  122,470
    Total assets$2,437,108 $2,079,256
    LIABILITIES AND STOCKHOLDERS’ EQUITY   
    Current liabilities:   
    Accounts payable$90,398 $113,767
    Accrued liabilities 197,919  157,912
    Deferred revenues, current 74,067  62,670
    Warranty obligations, current 29,197  19,395
    Debt, current 88,429  86,052
    Total current liabilities 480,010  439,796
    Long-term liabilities:   
    Deferred revenues, noncurrent 217,095  187,186
    Warranty obligations, noncurrent 67,354  53,982
    Other liabilities 23,864  16,530
    Debt, noncurrent 1,197,786  951,594
    Total liabilities 1,986,109  1,649,088
    Total stockholders’ equity 450,999  430,168
    Total liabilities and stockholders’ equity$2,437,108 $2,079,256

    ENPHASE ENERGY, INC. 
    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 
    (In thousands) 
    (Unaudited)

     Three Months Ended Six Months Ended
     June 30, 
    2022    		 March 31, 
    2022    		 June 30, 
    2021    		 June 30, 
    2022    		 June 30, 
    2021
    Cash flows from operating activities:         
    Net income$76,976  $51,821  $39,351  $128,797  $71,049 
    Adjustments to reconcile net income to net cash provided by operating activities:         
    Depreciation and amortization 15,247   15,558   7,596   30,805   13,154 
    Provision for doubtful accounts (16)  147   257   131   271 
    Asset impairment 1,200   —   —   1,200   — 
    Loss on partial settlement of convertibles notes —   —   13   —   56,382 
    Deemed repayment of convertible notes attributable to accreted debt discount —   —   (6)  —   (15,585)
    Non-cash interest expense 2,046   1,979   12,307   4,025   19,463 
    Change in fair value of debt securities (987)  1,116   (932)  129   (2,369)
    Stock-based compensation 53,064   47,797   15,312   100,861   30,156 
    Deferred income taxes 12,452   3,165   5,240   15,617   (30,127)
    Changes in operating assets and liabilities:         
    Accounts receivable 51,770   (24,224)  (44,812)  27,546   (98,531)
    Inventory (33,830)  (22,036)  (2,880)  (55,866)  4,008 
    Prepaid expenses and other assets (18,310)  (3,042)  (10,154)  (21,352)  (15,194)
    Accounts payable, accrued and other liabilities 12,033   (1,805)  10,514   10,228   46,890 
    Warranty obligations 12,972   9,906   5,385   22,878   14,025 
    Deferred revenues 16,033   22,061   28,469   38,094   47,909 
    Net cash provided by operating activities 200,650   102,443   65,660   303,093   141,501 
    Cash flows from investing activities:         
    Purchases of property and equipment (8,691)  (12,375)  (16,428)  (21,066)  (26,368)
    Purchases of marketable securities (60,061)  —   —   (60,061)  — 
    Maturities of marketable securities 116,298   76,735   —   193,033   — 
    Investments in private companies —   —   (20,000)  —   (45,000)
    Business acquisitions, net of cash acquired (3,055)  (24,625)  —   (27,680)  (55,239)
    Net cash provided by (used in) investing activities 44,491   39,735   (36,428)  84,226   (126,607)
    Cash flows from financing activities:         
    Issuance of convertible notes, net of issuance costs —   —   (949)  —   1,188,439 
    Purchase of convertible note hedges —   —   —   —   (286,235)
    Sale of warrants —   —   —   —   220,800 
    Principal payments and financing fees on debt —   —   (344)  —   (1,422)
    Partial repurchase of convertible notes —   —   (79)  —   (289,312)
    Repurchase of common stock —   —   (200,000)  —   (200,000)
    Proceeds from exercise of equity awards and employee stock purchase plan 4,183   404   3,428   4,587   3,642 
    Payment of withholding taxes related to net share settlement of equity awards (5,463)  (9,344)  (7,813)  (14,807)  (16,998)
    Net cash provided by (used in) financing activities (1,280)  (8,940)  (205,757)  (10,220)  618,914 
    Effect of exchange rate changes on cash and cash equivalents (238)  (704)  (224)  (942)  (926)
    Net increase (decrease) in cash and cash equivalents 243,623   132,534   (176,749)  376,157   632,882 
    Cash and cash equivalents—Beginning of period 251,850   119,316   1,489,010   119,316   679,379 
    Cash and cash equivalents —End of period$495,473  $251,850  $1,312,261  $495,473  $1,312,261 

    ENPHASE ENERGY, INC.
    RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
    (In thousands, except per share data and percentages)
    (Unaudited)

     Three Months Ended Six Months Ended
     June 30, 
    2022    		 March 31, 
    2022    		 June 30, 
    2021    		 June 30, 
    2022    		 June 30, 
    2021
    Gross profit (GAAP)$219,005  $176,973  $127,801  $395,978  $250,750 
    Stock-based compensation 3,131   2,507   1,060   5,638   2,042 
    Acquisition related amortization 1,445   1,299   —   2,744   — 
    Gross profit (Non-GAAP)$223,581  $180,779  $128,861  $404,360  $252,792 
              
    Gross margin (GAAP) 41.3%  40.1%  40.4%  40.8%  40.6%
    Stock-based compensation 0.6%  0.6%  0.4%  0.5%  0.3%
    Acquisition related amortization 0.3%  0.3%  —%  0.3%  —%
    Gross margin (Non-GAAP) 42.2%  41.0%  40.8%  41.6%  40.9%
              
    Operating expenses (GAAP)$124,969  $115,149  $68,401  $240,118  $129,964 
    Stock-based compensation (1) (49,933)  (45,290)  (14,252)  (95,223)  (28,114)
    Acquisition related expenses and amortization (3,867)  (3,609)  (2,453)  (7,476)  (6,455)
    Operating expenses (Non-GAAP)$71,169  $66,250  $51,696  $137,419  $95,395 
              
    (1)Includes stock-based compensation as follows:         
    Research and development$16,266  $13,729  $5,467  $29,995  $11,216 
    Sales and marketing 22,176   13,057   5,335   35,233   8,872 
    General and administrative 11,491   18,504   3,450   29,995   8,026 
    Total$49,933  $45,290  $14,252  $95,223  $28,114 
              
    Income from operations (GAAP)$94,036  $61,824  $59,400  $155,860  $120,786 
    Stock-based compensation 53,064   47,797   15,312   100,861   30,156 
    Acquisition related expenses and amortization 5,312   4,908   2,453   10,220   6,455 
    Income from operations (Non-GAAP)$152,412  $114,529  $77,165  $266,941  $157,397 
              
    Net income (GAAP)$76,976  $51,821  $39,351  $128,797  $71,049 
    Stock-based compensation 53,064   47,797   15,312   100,861   30,156 
    Acquisition related expenses and amortization 5,312   4,908   2,453   10,220   6,455 
    Non-cash interest expense 2,048   1,979   12,307   4,027   19,463 
    Loss on partial settlement of convertible notes —   —   13   —   56,382 
    Non-GAAP income tax adjustment 12,452   3,165   5,240   15,617   (30,127)
    Net income (Non-GAAP)$149,852  $109,670  $74,676  $259,522  $153,378 
              
    Net income per share, basic (GAAP)$0.57  $0.39  $0.29  $0.96  $0.53 
    Stock-based compensation 0.39   0.36   0.11   0.75   0.23 
    Acquisition related expenses and amortization 0.04   0.04   0.02   0.08   0.05 
    Non-cash interest expense 0.02   0.01   0.09   0.03   0.15 
    Loss on partial settlement of convertible notes —   —   —   —   0.42 
    Non-GAAP income tax adjustment 0.09   0.02   0.04   0.11   (0.23)
    Net income per share, basic (Non-GAAP)$1.11  $0.82  $0.55  $1.93  $1.15 
              
    Shares used in basic per share calculation GAAP and Non-GAAP 135,196   134,327   135,094   134,768   133,209 
              
    Net income per share, diluted (GAAP)$0.54  $0.37  $0.28  $0.91  $0.49 
    Stock-based compensation 0.38   0.34   0.11   0.73   0.22 
    Acquisition related expenses and amortization 0.04   0.04   0.02   0.08   0.05 
    Non-cash interest expense 0.02   0.02   0.09   0.03   0.14 
    Loss on partial settlement of convertible notes —   —   —   —   0.40 
    Non-GAAP income tax adjustment 0.09   0.02   0.03   0.11   (0.21)
    Net income per share, diluted (Non-GAAP) (2)$1.07  $0.79  $0.53  $1.86  $1.09 
              
    Shares used in diluted per share calculation GAAP 143,725   144,617   141,533   143,602   144,022 
    Shares used in diluted per share calculation Non-GAAP (3) 139,650   139,289   140,931   139,527   141,379 
              
    Net cash provided by operating activities (GAAP)$200,650  $102,443  $65,660  $303,093  $141,501 
    Purchases of property and equipment (8,691)  (12,375)  (16,428)  (21,066)  (26,368)
    Deemed repayment of convertible notes due 2024 and notes due 2025 attributable to accreted debt discount —   —   6   —   15,585 
    Free cash flow (Non-GAAP)$191,959  $90,068  $49,238  $282,027  $130,718 


    (2)Calculation of non-GAAP diluted net income per share for the three months ended June 30, 2022, March 31, 2022 and June 30, 2021, as well as the six months ended June 30, 2022 and 2021, excludes convertible notes due 2023 interest expense, net of tax of less than $0.1 million in each period from non-GAAP net income.
    (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 the Company has GAAP net income. The Company excluded the in-the-money portion of convertible notes due 2024 totaling 45 thousand shares and 1,506 thousand shares in the three months and six months ended June 30, 2021 from non-GAAP weighted-average diluted shares as the Company entered into convertible note hedge transactions that reduce potential dilution to the Company’s common stock upon any conversion of the notes due 2024. The Company excluded the in-the-money portion of convertible notes due 2025 totaling 557 thousand shares in the three months ended June 30, 2021 and 1,137 thousand shares in the six months ended June 30, 2021 from non-GAAP weighted-average diluted shares as the Company entered into convertible note hedge transactions that reduce potential dilution to the Company’s common stock upon any conversion of the notes due 2025.

     


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