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Enphase Energy Jumps After Company Posts Record Revenue, Gives Upbeat Guidance

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  • Shares of Enphase Energy jumped more than 16% during extended trading Tuesday following the company's fourth-quarter results.
  • Enphase earned 73 cents per share, adjusted, vs. 58 cents expected.
  • Revenue came in at $412.7 million, vs. $397 million expected.
  • "Our overall customer demand for Q1 is quite robust for both microinverters and batteries," CEO Badri Kothandaraman said on the company's earnings call.
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Shares of Enphase Energy rose more than 16% during extended trading Tuesday after the company reported record revenues for the fourth quarter. The company beat analyst estimates on both the top- and bottom-line.

Enphase, which makes microinverters and backup energy storage for solar systems, said sales jumped 17% quarter over quarter despite ongoing supply constraints and logistical challenges. The company also issued upbeat guidance.

"Our overall customer demand for Q1 is quite robust for both microinverters and batteries," CEO Badri Kothandaraman said on the company's earnings call. "The component availability is certainly better than what we experienced last year."

Kothandaraman said the issues the company continues to face are global in nature, rather than company-specific. "We are quite optimistic that our supply will catch up to demand during the year," he said, despite ongoing tight inventory for the company's energy storage products.

Here's how Enphase did versus analysts' expectations, as compiled by Refinitiv:

  • Earnings: 73 cents per share, adjusted
  • Revenue: $412.7 million

Wall Street analysts were expecting the company to earn 58 cents per share on $397 million in revenue.

In the same quarter one year ago Enphase posted earnings of 51 cents per share on an adjusted basis, and $264.8 million in revenue.

The company's full-year revenue hit $1.38 billion during 2021, up from $774.4 million in 2020. Enphase also said it generated $352 million in cash flow from operations during 2021, a record.

The company said it expects 2022 first-quarter revenue to be between $420 million and $440 million. That's ahead of the $409 million analysts surveyed by StreetAccount were expecting.

Shares of Enphase had been down 21% in 2022 through Tuesday's close. The company and solar industry broadly have faced a number of headwinds recently, including the stalled Build Back Better plan, a potential cut to California's solar incentive program and a broad market rotation out of growth names and into value.

Even in an inflationary environment the company reported a gross margin of 40.2% during the latest quarter, down slightly from the 40.8% reported during the third quarter.

Part of this is thanks to price hikes. Enphase raised prices once in the fall, and plans to implement another hike during the first quarter. But Kothandaraman doesn't expect this to dent appetite, saying there's "huge demand."

Due to supply chain bottlenecks, including at ports, the company's lead time — or how long it takes for a consumer to receive the product — is between 14 and 16 weeks. Under normal circumstances the timeframe would be closer to eight weeks.

Despite the recent challenges, Kothandaraman remains optimistic looking forward. "We are a resilient company," he said to CNBC following the quarterly update.

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