Enphase annual revenues declined amid an overall downturn in the residential solar market. The company improved its margins and significantly expanded U.S. manufacturing.
Fremont, California-based Enphase Energy, the world’s largest provider of solar microinverters, announced its Q4 2024 revenues, slightly beating Wall Street consensus expectations.
The company delivered $382 million in revenues, gross margins of 51.8%, and net income of $62 million. Net income and gross margins increased from $46 million and 46.8% from Q3 2024, respectively. Gross margins with the net benefit Inflation Reduction Act incentives included reached 53.2%.
In-quarter, the company delivered “strong” U.S. manufacturing results, shipping 1.7 million microinverters and 6.7 MWh of IQ batteries. Global-plus-U.S. manufactured microinverter shipments totaled 2 million microinverters and 152 MWh of IQ batteries.
“We continue to evolve our sourcing strategy to maximize domestic content opportunities and diversify our geographic exposure,” said Enphase Energy chief executive officer Badrinarayanan Kothandaraman. “Our U.S. and international revenue mix for Q4 was 79% and 21%, respectively.”
The company’s annual global production capacity is about 7.25 million microinverters, 5 million of which are manufactured in the United States via contract manufacturing partners.
“We are generally seeing stable demand in the U.S., both in California as well as outside of California. NEM 3.0 currently represents 66% of our installs in California with a 45% attach rate for our own battery. The adoption of batteries is steadily increasing across the U.S. due to new tariff structures like NEM 3.0, VPP programs, and the need for resilience,” Kothandaraman said.
On a year-over-year basis, revenues declined considerably from 2023 to 2024. In 2023, the company reached $2.29 billion in revenues, while 2024 totaled $1.33 billion, down roughly 42%. The decline mirrored a down year for residential solar globally.
The company exited the fourth quarter of 2024 with $1.72 billion in cash, cash equivalents, restricted cash and marketable securities and generated $167.3 million in cash flow from operations in the fourth quarter.
During the fourth quarter, the company introduced new products including the IQ Meter Collar, fourth-generation IQ Battery, and new IQ Combiner products. It launched the IQ PowerPack 1500, a 1.5 kWh smart, portable energy system for home, work, and on-the-go use.
Looking ahead to the first quarter of 2025, the company expects revenue to be within a range of $340 million to $380 million, which includes shipments of 150 MWh to 170 MWh of IQ Batteries and 1.2 million microinverters.
The first quarter of 2025 financial outlook includes approximately $50.0 million of safe harbor revenue. The company defines safe harbor revenue as any sales made to customers who plan to install the inventory over more than one year.
“We successfully navigated a challenging 2024, generating strong free cash flow and profitable — and profitability while bringing down channel inventory to normalized levels. We entered 2025 with a continued focus on operational efficiency, product reliability, customer service, product breadth, and geographic expansion. We have also doubled down on U.S. manufacturing for microinverters and batteries, which we believe is good for our customers, economy, and for Enphase,” Kothandaraman said.
