First Solar’s first quarter was marked by rising policy headwinds and operational complexity, prompting a negative market reaction. Management attributed the underperformance to a larger-than-expected share of international product sales, which carried lower margins than U.S.-produced modules. CEO Mark Widmar explained, “Our Q1 earnings per diluted share came in below the low end of our guidance range at $1.95 per share, primarily due to a greater portion of our Q1 sales being forecasted to be an international versus U.S. product.” The company also faced ongoing issues related to tariffs, shipping delays, and the aftereffects of previous manufacturing challenges in its Series 7 modules.
Is now the time to buy FSLR? Find out in our full research report (it’s free).
First Solar (FSLR) Q1 CY2025 Highlights:
- Revenue: $844.6 million vs analyst estimates of $847.9 million (6.4% year-on-year growth, in line)
- EPS (GAAP): $1.95 vs analyst expectations of $2.50 (22.1% miss)
- Adjusted EBITDA: $45.3 million vs analyst estimates of $381.6 million (5.4% margin, 88.1% miss)
- The company dropped its revenue guidance for the full year to $5 billion at the midpoint from $5.55 billion, a 9.9% decrease
- EPS (GAAP) guidance for the full year is $15 at the midpoint, missing analyst estimates by 16.9%
- Operating Margin: 26.2%, down from 30.6% in the same quarter last year
- Market Capitalization: $15.52 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions First Solar’s Q1 Earnings Call
- Philip Shen (ROTH Capital Partners) asked about bookings momentum post-tariffs and resolution of manufacturing issues. CEO Mark Widmar described increased customer outreach but noted pricing and demand remain unclear amid policy uncertainty.
- Andrew Percoco (Morgan Stanley) questioned the sharp volume downside in guidance. Widmar emphasized that reciprocal tariffs could render international shipments uneconomical, and much depends on customer negotiations yet to be held.
- Kashy Harrison (Piper Sandler) inquired about the fate of international assets if tariffs rise further. Management outlined options including redeploying equipment to the U.S. or adjusting factory operations, but stressed decisions hinge on future policy outcomes.
- Brian Lee (Goldman Sachs) pressed for details on margin strategy under new tariffs and plans for U.S. finishing capacity. CFO Alex Bradley explained that current guidance assumes First Solar absorbs tariffs, but the company hopes to negotiate cost-sharing with customers.
- Julien Dumoulin-Smith (Jefferies) sought clarity on repricing risk for the backlog. Widmar clarified that most risk is isolated to the 12 gigawatts of international contracts, with domestic supply largely insulated from tariff-driven renegotiation.
Catalysts in Upcoming Quarters
In the coming quarters, our analysts will monitor (1) the outcome of customer renegotiations on international contract volumes and tariff cost-sharing; (2) the pace and cost-efficiency of ramping new U.S. factories in Alabama and Louisiana; and (3) any changes to clean energy tax credits and trade policy that could affect both supply chain strategy and demand. Execution on these fronts will show how effectively First Solar can balance external headwinds and internal expansion.
First Solar currently trades at $152.29, up from $137.17 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free).
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