First Solar Q4 Results Continue To Wait On India Surge, Ships 14.1 GW Worldwide

First Solar, Inc. has announced financial results for the fourth quarter and year ended December 31, 2024. The US-based company’s net sales for the fourth quarter were $1.5 billion, an increase of $0.6 billion from the prior quarter. The increase was primarily a result of increased module sales in the fourth quarter. In an earnings call, First Solar mentioned, “We are pleased to have sold a record 14.1 gigawatts of modules in 2024. Our record net sales of $4.2 billion, in line with our prior earnings call guidance, represented a 27% increase year-on-year.”

First Solar had enjoyed a strong revival in the past three years as focus has shifted to cutting dependence on China for solar equipment in the US and elsewhere. The firm is known for its advanced thin-film cadmium telluride (CdTe) technology which claims better temperature coefficients and reduced material usage compared to traditional silicon panels.  With its own recycling program, the biggest challenge for the firm has been the price competitiveness of Chinese firms, which is where the enactment of domestic tariff walls has helped First Solar become competitive, in the US and to an extent, in India.  In India,  where it is the only foreign firm that is part of the ALMM, it has forecast a production of 3-3.2 GW of modules in 2025. However, the firm has struggled to find the kind of visibility for domestic India sales as it has in the US.

First Solar’s net sales for the full year 2024 were $4.2 billion compared to $3.3 billion in the prior year. The company associated this increase to be primarily driven by a higher volume of modules sold to third parties. Whereas, its fourth-quarter net income per diluted share of $3.65 and full-year net income per diluted share of $12.02.

The company also noted that cash, cash equivalents, restricted cash, restricted cash equivalents, and marketable securities, less debt at the end of the fourth quarter increased to $1.2 billion from $0.7 billion at the end of the prior quarter. The increase was primarily the result of the initial proceeds received from the sale of 2024 Section 45X tax credits and module segment operating cash flows, partially offset by capital expenditures associated with their Alabama and Louisiana facilities.

Uncertainty Due To Unresolved Policy In India 

Mark Widmar Chief Executive Officer (CEO) of First Solar talked about uncertainty around expansion plans in India. In an investor’s call, he said, “….at present, continuing a trend that increased throughout 2024, there remains significant near-term uncertainty, largely driven by the still unresolved policy environment following the US elections in November. This uncertainty is also driving a pause in at least some domestic manufacturing expansions. Just a one example, earlier this month, Indian solar manufacturer Premier Energies announced it is pausing plans to build a cell plant in the US citing policy uncertainty…..Excluding India, we remain cumulatively oversold through 2026.”

Policy Impact 

While talking about the political hindrance, he mentioned, “While typically, we would seek to mitigate the impact of these factors by reallocating shifted or terminated deliveries to other customers, our ability to do so in the near term, particularly as it relates to our Southeast Asia produced product is constrained by the policy environment in Europe, India, and the US. In Europe, the combination of China’s strategy of product dumping and oversaturation with the aim of capturing the European market, combined with a lack of EU block political action to employ responsive trade remedies to level the playing field has resulted in the EU market becoming a less attractive destination for our international production.”

India’s Export To US Market 

Mark Widmar stated, “In India, we forecast production of 3 to 3.2 gigawatts in 2025, with approximately 70% destined for the U.S. and the rest for domestic sales. This contributes to a total annual production estimate of 18 to 19 gigawatts. Growth-related costs are expected to impact operating income by $110 million to $130 million.”

He added, “About two-thirds of our India production will be exported in 2025, up from roughly half in 2024, leading to a higher blended production cost at this facility. Additionally, a planned 1-gigawatt reduction in output at our Vietnam and Malaysia factories will increase fixed costs per watt due to lower throughput.”

A First Solar representative also noted challenges in production this year, including increased imports from India and tariff impacts. “A significant factor in our cost structure is the reduction of about a gigawatt in Southeast Asia production. While not enough to classify as underutilization, it does raise the cost per watt due to lower absorption of fixed costs. Despite these challenges, production remains close to expectations.”

Growth Plan

“In 2024, we continued building the foundations required for our long-term growth strategy,” said Mark Widmar, chief executive officer, First Solar. “Even as we maintained a highly selective approach to bookings, we expanded manufacturing capacity by commissioning our Alabama facility and progressed construction of our new Louisiana facility, established the infrastructure we anticipate will accelerate innovation with a new R&D center in Ohio, and produced and shipped a historic volume of modules.”

The guidance figures presented above are forward-looking statements that are subject to a variety of assumptions and estimates, including with respect to certain factors related to the Inflation Reduction Act of 2022 (the “IRA”). Among other things, such factors include (i) the total advanced manufacturing production credit available to us under Section 45X of the Internal Revenue Code and (ii) the timing and ability to monetize such credit. Investors are encouraged to listen to the conference call and to review the accompanying materials, which contain more information about First Solar’s fourth quarter and full year 2024 financial results, 2025 guidance, and financial outlook.