Maxeon posts US$14.9 million losses in delayed Q1 ’24 results

The announcement of Q1 results was originally due last week (23 May). On 22 May, Maxeon said it needed to delay the announcement to “complete the company’s preparation of its annual and quarterly reports and to provide the market with a comprehensive business update.” This was the same day that the company received notice of non-compliance from the Nasdaq stock exchange over failure to submit its full-year 2023 financial statements.

In the Q1 2024 financial statement, CEO Bill Mulligan, said: “Maxeon has been facing a very difficult market environment since the third quarter of last year, with challenging industry pricing conditions and demand disruptions in our DG business due to higher interest rates and policy changes, as well as project pushouts by two of our large-scale customers in the US.”

He continued: “While the Company is making progress on our announced restructuring initiatives and we are seeing some positive trends in the market, we determined that Maxeon requires additional capital to support its continuing operations.”

This initial capital has been provided by Maxeon’s principal and shareholder, TCL Zhonghuan Renewable Energy Technology Co. Ltd. (TZE). Maxeon said TZE has “agreed to invest” US$97.5 million in debt financing and an additional US$100 million in equity investment.

Restructuring costs associated with the ramp-down of its Maxeon 6 module capacity affected Maxeon’s Q4 2023 results, which it posted last month. During that quarter, the company announced a plan to lay off 22% of its global workforce as it forecast losses between US$5 million – US$15 million for Q4.

US-focused

In the same statement, Mulligan said that Maxeon’s utility-scale solar operations would be focused on the US from now on.

He said: “Going forward, our activities in utility-scale will be focused exclusively on the US market, where our longstanding customer relationships, track record of execution, supply chain structure, differentiated products and leading sustainability profile makes us a supplier of choice for many developers [sic].”

He also announced the sale of Maxeon’s stake in Chinese solar cell producer Huansheng Photovoltaic (Jiangsu) Co., Ltd and the execution of an IP-license for solar cell shingling technology.

In August, Maxeon announced plans to build a 3GW solar cell and module production facility in Albuquerque, New Mexico to produce tunnel oxide passivated contact (TOPCon) solar products. It also operates a module assembly plant in Mexico, which last year it expanded to 1.8GW of capacity.

Mulligan continued: “While current pricing and demand conditions remain challenging, we are seeing some positive trade policy trends and we are cautiously optimistic that these could result in stronger pricing power, improved demand and incremental bookings.”

The US has recently announced a flurry of new trade laws and regulations which will affect solar PV imports and potentially create favourable conditions for domestic products.

He added: “On the technology front, we’re seeing competitors rapidly shift to TOPCon products which we believe infringe on US intellectual property we developed over 15 years ago.”

Maxeon has initiated three US lawsuits against manufacturing competitors over TOPCon products. Suits against REC Solar, Hanwha Qcells and Canadian Solar are all ongoing.

The company was unsuccessful last week in a preliminary injunction against solar manufacturer Aiko Solar in the Netherlands.

Financial outlook

On the financial front, Maxeon forecasts full-year 2024 EBITDA losses of US$110 million-160 million. Revenues are anticipated of US$640 million-800 million.

For Q2 2024, it anticipates gross losses of around US$20 million and adjusted EBITDA losses of between US$31 million and US$51 million. Shipments are likely to be between 520-600MW.