First Solar Shines in Q2 2025 Earnings Call

First Solar ((FSLR)) has held its Q2 earnings call. Read on for the main highlights of the call.

First Solar’s recent earnings call paints a generally optimistic picture, underscored by robust module sales, earnings that surpassed expectations, and a supportive policy environment. Despite these positive signals, the company is navigating challenges such as international tariff impacts and contract terminations.

Strong Module Sales and Manufacturing

First Solar reported impressive module sales of 3.6 gigawatts in Q2 2025, surpassing the forecasted midpoint. The company produced 4.2 gigawatts, with a significant contribution from U.S. facilities, which accounted for 2.4 gigawatts. The company anticipates its U.S. manufacturing capacity to exceed 14 gigawatts by 2026, highlighting its commitment to scaling operations domestically.

Earnings Exceed Expectations

The company delivered earnings per diluted share of $3.18, exceeding the high end of their guidance range. Net sales for the quarter reached $1.1 billion, marking a $0.3 billion increase from the previous quarter, reflecting strong financial performance.

Advancements in Technology

First Solar continues to innovate with advancements in their CuRe technology platform and progress in perovskite development. The company is set to produce small form factor modules by August, showcasing its commitment to technological leadership in the solar industry.

Positive Policy Environment

Recent U.S. policy changes, including new reconciliation legislation, have been favorable for First Solar. These changes bolster the company’s competitive position against Chinese manufacturers, providing a strategic advantage in the market.

Increased Bookings and Demand

Following the enactment of the reconciliation bill, First Solar recorded 2.1 gigawatts of new bookings, driven by strong demand for U.S. manufactured products. This indicates a healthy market appetite and confidence in First Solar’s offerings.

International Tariff Challenges

The company faces significant challenges due to increased tariffs on international products, which affect financial and operational planning. Tariffs are particularly high for Malaysia, Vietnam, and India, posing a hurdle for international sales.

Contract Terminations and De-bookings

First Solar experienced net de-bookings of 0.2 gigawatts as of June 30, 2025, primarily due to contract terminations. This includes 0.9 gigawatts of Series 6 international products, highlighting the volatility in international contracts.

Logistics and Cost Challenges

The company has incurred increased detention and demurrage charges, alongside higher core costs. Challenges related to warehousing, logistics, and potential restructuring charges are also impacting the company’s operational efficiency.

Uncertain Tariff and Trade Environment

Ongoing uncertainty around tariffs and trade policies continues to pose challenges for First Solar, affecting international sales volumes and logistics costs. This uncertainty necessitates cautious financial and operational planning.

Forward-Looking Guidance

First Solar’s outlook for the remainder of 2025 is optimistic, driven by key metrics such as module sales and earnings per share that have exceeded forecasts. The company is expanding its U.S. capacity, with the Louisiana site expected to add over 14 gigawatts by 2026. Despite policy and trade uncertainties, First Solar remains confident in its strategic positioning, projecting 2025 earnings per diluted share of $13.5 to $16.5, with anticipated net sales between $4.9 billion and $5.7 billion.

In conclusion, First Solar’s earnings call reflects a positive sentiment with strong sales and earnings performance, supported by favorable policy changes. However, challenges such as international tariffs and contract terminations remain. The company’s forward-looking guidance suggests continued growth and strategic expansion, reinforcing its position as a leader in the solar industry.