Residential solar company SunPower (Nasdaq: SPWR) suffered a 70% decline in share prices of its stock this week, crashing nearly 50% on Friday, July 19.
Reuters reported that SunPower communicated to its employees that it will pause several core operations. The company announced it will deactivate its lease and power purchase agreement offerings and will discontinue new product shipments.
SunPower said it will stop countersigning new agreements and is unable to support installation services for shipments currently in transit or already delivered.
Residential solar in the United States has been struggling over the past two years as rising interest rates and regulatory changes have squeezed the value offered to customers. As demand fell, rising excess inventory posed further challenges for installers. Installations are down 20% nationwide in 2024.
SunPower’s struggles have continued through persistent high interest rates. In December 2023 the company defaulted on its debt and issued a warning that it had “going concerns” about remaining in business.
In April the company announced it would close numerous installation service centers across the country and cut about 26% of its workforce.
The company’s share price target was cut to $0 by Gordon Johnson from GLJ Research. Roth Capital Partners said competitors Sunrun and Sunnova are likely to gain from the lost market share left behind by SunPower.
“We think this effectively marks the end for SPWR as an operating business,” said an analyst note from Guggenheim. “Considering the debt that the company has accumulated, we believe that SPWR’s equity no longer has any value.”
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