SunPower (SPWR) Q3 2021 earnings

A SunPower executive on site at the California Valley Solar Farm near Santa Margarita, Calif., in San Luis Obispo County.

Michael Macor | San Francisco Chronicle | Hearst Newspapers via Getty Images

SunPower shares dipped as much as 9% after the company reported third-quarter revenues that came shy of expectations and did not announce a buyer for its commercial and industrial business.

Here’s how the company did versus analysts’ expectations, as compiled by Refinitiv:

  • Earnings: 6 cents per share, adjusted
  • Revenue: $324 million vs $333 million expected

Wall Street analysts were expecting the company to earn 3 cents per share. It was not immediately clear whether the reported number is comparable to estimates. The company reported non-GAAP gross margin of 18.7%, down from 20.6% during the second quarter.

The third-quarter results compare with EPS of 6 cents per share on revenue of $309 million in Q2, and a loss of 4 cents per share on revenue of $275 million in the year-ago quarter.

The company gave fourth-quarter revenue guidance of $330 million to $380 million, excluding the CIS and legacy businesses.

The company said its customer additions during the period jumped 29% year over year to 14,200. In total SunPower now has nearly 390,000 residential customers, with an additional 20,000 coming from the recent acquisition of Blue Raven.

Wednesday’s results come after the company announced restructuring plans in October aimed at doubling down on the residential market. As part of that, SunPower acquired home solar company Blue Raven and said it will sell its commercial and industrial business.

The company said it will provide an update on a potential buyer by the end of the current quarter.

“The interest in the business has been very strong,” CEO Peter Faricy told CNBC, although he declined to provide specifics. “The business is very healthy…despite the fact that it’s had a couple of challenging quarters, mostly due to projects slips tied to all the same supply chain and labor issues,” he said of the commercial and industrial division.

Faricy also left the door open for potential future deals, saying the company has both organic opportunities as well as acquisition opportunities.

“We have a very healthy balance sheet. We’re not the kind of company that’s going to sit around and wonder what to do with the cash,” he said.

Supply chain headwinds are impacting just about every area of the economy, but Faricy said they’re easier to manage on the residential side since it’s just the company and customer.

“We’ve had zero impact of not being able to get products to our customers…We have not seen on the residential side of our business any really material impact from supply chain,” he said.

But SunPower’s commercial division, which relies on multiple parties coming together, has been impacted.

Faricy, who joined SunPower in April, said the company’s new mission includes building long-term relationships with consumers that stretch across a range of products. Part of that is improving the company’s software offering, as well as reducing the time it takes to have products installed.

Last month’s restructuring announcement was not the first for SunPower. In August 2020 the company spun out photovoltaic module makerĀ Maxeon Solar. While the two companies are now separate entities, they do continue to work together.

Faricy said the company’s now found its footing and is going on the “offense” amid heightened focus on the need to shift to renewable energy.

“This is a pivotal moment right now, both for climate change, but also for the adoption of renewable energy. When you have a business opportunity like that, going on offense is the right strategy,” he said.

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