Delaware | 94-3008969 |
(State or other jurisdiction of incorporation) | (I.R.S. Employer Identification No.) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. | Results of Operations and Financial Condition. |
Item 9.01. | Financial Statements and Exhibits. |
Exhibit No. | Description |
Press release dated May 9, 2019 |
SUNPOWER CORPORATION | ||
May 9, 2019 | By: | /S/ MANAVENDRA S. SIAL |
Name: | Manavendra S. Sial | |
Title: | Executive Vice President and Chief Financial Officer |
• | Launched new portfolio of Maxeon and Performance Series (P-Series) panels in U.S. and international markets |
• | Agreement to monetize commercial sale-leaseback portfolio for $87 million; sold first C&I project under innovative financing partnership with Goldman Sachs Renewable Power |
• | SunPower Energy Services (SPES) |
◦ | Commenced U.S. shipments of 415-watt residential A-Series panel |
◦ | Helix storage solutions pipeline increased to 110 megawatts (MW) with 35 percent attach rate |
• | SunPower Technologies (SPT) |
◦ | World record 25 percent Maxeon Gen 5 solar cells in volume production; initiated tool install for second manufacturing line |
◦ | Strong volume growth in international distributed generation (DG) markets |
($ Millions, except percentages and per-share data) | 1st Quarter 2019 | 4th Quarter 2018 | 1st Quarter 2018 |
GAAP revenue | $348.2 | $456.8 | $391.9 |
GAAP gross margin | (10.7)% | (1.7)% | 2.6% |
GAAP net loss | $(89.7) | $(158.2) | $(116.0) |
GAAP net loss per diluted share | $(0.63) | $(1.12) | $(0.83) |
Non-GAAP revenue1 | $411.6 | $525.4 | $398.9 |
Non-GAAP gross margin1 | 6.0% | 6.9% | 6.5% |
Non-GAAP net loss1 | $(57.4) | $(30.3) | $(28.2) |
Non-GAAP net loss per diluted share1 | $(0.41) | $(0.21) | $(0.20) |
Adjusted EBITDA1 | $(23.8) | $13.6 | $32.3 |
MW Deployed | 455 | 441 | 326 |
March 31, 2019 | December 30, 2018 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 185,554 | $ | 309,407 | |||
Restricted cash and cash equivalents, current portion | 864 | 41,762 | |||||
Accounts receivable, net | 156,445 | 175,605 | |||||
Contract assets | 57,282 | 58,994 | |||||
Inventories | 334,390 | 308,146 | |||||
Advances to suppliers, current portion | 95,603 | 37,878 | |||||
Project assets - plants and land, current portion | 10,246 | 10,796 | |||||
Prepaid expenses and other current assets | 99,675 | 131,183 | |||||
Assets held for sale | 550,073 | — | |||||
Total current assets | 1,490,132 | 1,073,771 | |||||
Restricted cash and cash equivalents, net of current portion | 13,345 | 12,594 | |||||
Restricted long-term marketable securities | 5,948 | 5,955 | |||||
Property, plant and equipment, net | 413,347 | 839,871 | |||||
Operating lease right-of-use assets | 32,638 | — | |||||
Solar power systems leased and to be leased, net | 74,134 | 92,557 | |||||
Advances to suppliers, net of current portion | 62,914 | 133,694 | |||||
Long-term financing receivables, net - held for sale | 19,044 | 19,592 | |||||
Other intangible assets, net | 10,858 | 12,582 | |||||
Other long-term assets | 185,371 | 162,033 | |||||
Total assets | $ | 2,307,731 | $ | 2,352,649 | |||
Liabilities and Equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 347,233 | $ | 325,550 | |||
Accrued liabilities | 190,095 | 235,252 | |||||
Operating lease liabilities, current portion | 8,502 | — | |||||
Contract liabilities, current portion | 92,621 | 104,130 | |||||
Short-term debt | 41,838 | 40,074 | |||||
Liabilities held for sale | 619,538 | — | |||||
Total current liabilities | 1,299,827 | 705,006 | |||||
Long-term debt | 71,593 | 40,528 | |||||
Convertible debt | 818,832 | 818,356 | |||||
Operating lease liabilities, net of current portion | 29,490 | — | |||||
Contract liabilities, net of current portion | 75,059 | 99,509 | |||||
Other long-term liabilities | 234,386 | 839,136 | |||||
Total liabilities | 2,529,187 | 2,502,535 | |||||
Equity: | |||||||
Preferred stock | — | — |
Common stock | 142 | 141 | |||||
Additional paid-in capital | 2,469,998 | 2,463,370 | |||||
Accumulated deficit | (2,561,561 | ) | (2,480,988 | ) | |||
Accumulated other comprehensive loss | (4,051 | ) | (4,150 | ) | |||
Treasury stock, at cost | (190,940 | ) | (187,069 | ) | |||
Total stockholders' deficit | (286,412 | ) | (208,696 | ) | |||
Noncontrolling interests in subsidiaries | 64,956 | 58,810 | |||||
Total deficit | (221,456 | ) | (149,886 | ) | |||
Total liabilities and equity | $ | 2,307,731 | $ | 2,352,649 |
THREE MONTHS ENDED | ||||||||||||
March 31, 2019 | December 30, 2018 | April 1, 2018 | ||||||||||
Revenue: | ||||||||||||
SunPower Energy Services | $ | 178,221 | $ | 265,427 | $ | 246,928 | ||||||
SunPower Technologies | 230,804 | 277,256 | 253,834 | |||||||||
Intersegment eliminations | (60,800 | ) | (85,846 | ) | (108,874 | ) | ||||||
Total revenue | 348,225 | 456,837 | 391,888 | |||||||||
Cost of revenue: | ||||||||||||
SunPower Energy Services | 171,078 | 245,301 | 206,003 | |||||||||
SunPower Technologies | 282,868 | 296,872 | 278,041 | |||||||||
Intersegment eliminations | (68,436 | ) | (77,765 | ) | (102,730 | ) | ||||||
Total cost of revenue | 385,510 | 464,408 | 381,314 | |||||||||
Gross profit (loss) | (37,285 | ) | (7,571 | ) | 10,574 | |||||||
Operating expenses: | ||||||||||||
Research and development | 14,993 | 15,481 | 19,052 | |||||||||
Sales, general and administrative | 62,857 | 53,839 | 65,295 | |||||||||
Restructuring charges (credits) | (665 | ) | (1,107 | ) | 11,177 | |||||||
Impairment and sale of residential lease assets | 9,226 | 81,086 | 49,092 | |||||||||
Gain on business divestiture | (6,114 | ) | — | — | ||||||||
Total operating expenses | 80,297 | 149,299 | 144,616 | |||||||||
Operating loss | (117,582 | ) | (156,870 | ) | (134,042 | ) | ||||||
Other income (expense), net: | ||||||||||||
Interest income | 852 | 777 | 529 | |||||||||
Interest expense | (16,791 | ) | (30,214 | ) | (25,106 | ) | ||||||
Other, net | 33,073 | 6,539 | 15,794 | |||||||||
Other income (expense), net | 17,134 | (22,898 | ) | (8,783 | ) | |||||||
Loss before income taxes and equity in losses of unconsolidated investees | (100,448 | ) | (179,768 | ) | (142,825 | ) | ||||||
Benefit from (provision for) income taxes | (5,797 | ) | 8,379 | (2,628 | ) | |||||||
Equity in earnings (losses) of unconsolidated investees | 1,680 | (757 | ) | (2,144 | ) | |||||||
Net loss | (104,565 | ) | (172,146 | ) | (147,597 | ) | ||||||
Net loss attributable to noncontrolling interests and redeemable noncontrolling interests | 14,841 | 13,972 | 31,623 | |||||||||
Net loss attributable to stockholders | $ | (89,724 | ) | $ | (158,174 | ) | $ | (115,974 | ) |
Basic and diluted net loss per share attributable to stockholders | $ | (0.63 | ) | $ | (1.12 | ) | $ | (0.83 | ) | |||
Basic and diluted weighted-average shares | 141,720 | 141,136 | 140,212 |
THREE MONTHS ENDED | ||||||||||||
March 31, 2019 | December 30, 2018 | April 1, 2018 | ||||||||||
Cash flows from operating activities: | ||||||||||||
Net loss | $ | (104,565 | ) | $ | (172,146 | ) | $ | (147,597 | ) | |||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||||
Depreciation and amortization | 24,190 | 24,060 | 39,833 | |||||||||
Stock-based compensation | 5,666 | 6,266 | 7,053 | |||||||||
Non-cash interest expense | 2,415 | 3,213 | 4,443 | |||||||||
Dividend from equity method investee | — | — | 5,399 | |||||||||
Equity in (earnings) losses of unconsolidated investees | (1,680 | ) | 756 | 2,144 | ||||||||
Unrealized (gain) loss on equity investment with readily determinable fair value | (33,000 | ) | 150 | — | ||||||||
Gain on business divestiture | (6,114 | ) | — | — | ||||||||
Gain on sale of equity investments, net | — | (3,628 | ) | (15,576 | ) | |||||||
Deferred income taxes | 2,048 | (9,868 | ) | (344 | ) | |||||||
Loss on sale and impairment of residential lease assets | 9,226 | 81,086 | 49,092 | |||||||||
Other, net | — | (1,059 | ) | 972 | ||||||||
Changes in operating assets and liabilities: | ||||||||||||
Accounts receivable | 12,196 | 18,916 | 13,924 | |||||||||
Contract assets | 1,712 | (5,495 | ) | (23,561 | ) | |||||||
Inventories | (41,718 | ) | 64,617 | (34,195 | ) | |||||||
Project assets | 776 | 48,652 | 20,484 | |||||||||
Prepaid expenses and other assets | 11,727 | (17,161 | ) | 10,885 | ||||||||
Operating lease right-of-use assets | 2,603 | — | — | |||||||||
Long-term financing receivables, net | (1,611 | ) | (31,006 | ) | (38,114 | ) | ||||||
Advances to suppliers | 13,055 | 15,236 | 5,149 | |||||||||
Accounts payable and other accrued liabilities | (28,819 | ) | (58,230 | ) | (100,156 | ) | ||||||
Contract liabilities | (14,578 | ) | 9,328 | (33,097 | ) | |||||||
Operating lease liabilities | (2,559 | ) | — | — | ||||||||
Net cash used in operating activities | (149,030 | ) | (26,313 | ) | (233,262 | ) | ||||||
Cash flows from investing activities: | ||||||||||||
Purchases of property, plant and equipment | (6,548 | ) | (7,198 | ) | (8,859 | ) | ||||||
Cash paid for solar power systems, leased, net | — | (12,953 | ) | (23,787 | ) | |||||||
Cash paid for solar power systems | (27,600 | ) | (37,468 | ) | (2,604 | ) | ||||||
Cash outflow from sale of residential lease portfolio, net of cash sold | (28,004 | ) | — | |||||||||
Proceeds from sale of cost method investments | — | 33,402 | — | |||||||||
Cash paid for acquisitions, net of cash acquired | — | (17,000 | ) | — | ||||||||
Dividend from equity method investee | — | — | 2,694 | |||||||||
Proceeds from sale of equity method investments | — | 2,540 | 27,282 | |||||||||
Proceeds from business divestitures | 9,677 | 10,000 | — |
THREE MONTHS ENDED | ||||||||||||
March 31, 2019 | December 30, 2018 | April 1, 2018 | ||||||||||
Cash paid for investments in unconsolidated investees | — | (626 | ) | (6,349 | ) | |||||||
Net cash used in investing activities | (24,471 | ) | (57,307 | ) | (11,623 | ) | ||||||
Cash flows from financing activities: | ||||||||||||
Proceeds from bank loans and other debt | 67,979 | 60,199 | 49,794 | |||||||||
Repayment of bank loans and other debt | (58,372 | ) | (59,023 | ) | (51,052 | ) | ||||||
Proceeds from issuance of non-recourse residential financing, net of issuance costs | 22,255 | 5,079 | 32,687 | |||||||||
Repayment of non-recourse residential financing | — | (2,427 | ) | (3,781 | ) | |||||||
Contributions from noncontrolling interests and redeemable noncontrolling interests attributable to residential projects | 20,987 | 43,526 | 36,726 | |||||||||
Distributions to noncontrolling interests and redeemable noncontrolling interests attributable to residential projects | — | (2,742 | ) | (5,422 | ) | |||||||
Proceeds from issuance of non-recourse power plant and commercial financing, net of issuance costs | — | 75,754 | 9,104 | |||||||||
Repayment of non-recourse power plant and commercial financing | — | (26,383 | ) | (890 | ) | |||||||
Settlement of contingent consideration arrangement | (2,448 | ) | — | — | ||||||||
Purchases of stock for tax withholding obligations on vested restricted stock | (3,872 | ) | (281 | ) | (4,526 | ) | ||||||
Net cash provided by financing activities | 46,529 | 93,702 | 62,640 | |||||||||
Effect of exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents | 112 | 1,296 | 477 | |||||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents | (126,860 | ) | 11,378 | (181,768 | ) | |||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of period1 | 363,763 | 352,385 | 544,337 | |||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents, end of period1 | $ | 236,903 | $ | 363,763 | $ | 362,569 | ||||||
Non-cash transactions: | ||||||||||||
Costs of solar power systems, leased and to be leased, sourced from existing inventory | $ | — | $ | 5,975 | $ | 14,354 | ||||||
Costs of solar power systems, leased and to be leased, funded by liabilities | $ | — | $ | 3,631 | $ | 5,835 | ||||||
Costs of solar power systems sourced from existing inventory | $ | 16,406 | $ | — | $ | — | ||||||
Costs of solar power systems funded by liabilities | $ | 4,553 | $ | — | $ | — | ||||||
Costs of solar power systems under sale-leaseback financing arrangements, sourced from project assets | $ | — | $ | 56,332 | $ | 9,791 | ||||||
Property, plant and equipment acquisitions funded by liabilities | $ | 10,792 | $ | 8,214 | $ | 12,768 | ||||||
Acquisition funded by liabilities | $ | — | $ | 9,000 | $ | — | ||||||
Contractual obligations satisfied with inventory | $ | — | $ | 7,924 | $ | 17,517 | ||||||
Assumption of debt by buyer upon sale of equity interest | $ | — | $ | — | $ | 27,321 |
THREE MONTHS ENDED | ||||||||||||
March 31, 2019 | December 30, 2018 | April 1, 2018 | ||||||||||
Assumption of mezzanine loan by SunStrong in connection with sale of residential lease assets | $ | — | $ | 106,958 | $ | — | ||||||
Assumption of back leverage loans by SunStrong in connection with sale of residential lease assets | $ | — | $ | 454,630 | $ | — | ||||||
Retained interest in SunStrong lease portfolio | $ | — | $ | 9,750 | $ | — | ||||||
Receivables in connection with sale of residential lease portfolio | $ | — | $ | 12,510 | $ | — | ||||||
Right-of-use assets obtained in exchange of lease obligations | $ | 81,525 | $ | — | $ | — |
• | 8point3: The company includes adjustments related to the sales of projects contributed to 8point3 Energy Partners based on the difference between the fair market value of the consideration received and the net carrying value of the projects contributed, of which, a portion was deferred in proportion to its retained equity interest in 8point3 Energy Partners, at the time. Prior to the adoption of ASC 606, these sales were recognized under either real estate, lease, or consolidation accounting guidance depending upon the nature of the individual asset contributed, with outcomes ranging from no, partial, or full profit recognition. The company adopted ASC 606 on January 1, 2018, using the full retrospective method, which required it to restate each prior period presented. The company recorded a material amount of deferred profit associated with projects sold to 8point3 Energy Partners in 2015, the majority of which had previously been deferred under real estate accounting. Accordingly, the carrying value in the 8point3 Group materially increased upon adoption which required us to evaluate the company's investment in 8point3 Energy Partners for other-than-temporary impairment ("OTTI"). In accordance with such evaluation, the company recognized |
• | Legacy utility and power plant projects: The company includes adjustments related to revenue recognition of certain utility and power plant projects based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligations and, when relevant, the allocation of revenue and margin to the company’s project development efforts at the time of initial project sale. Prior to the adoption of ASC 606, such projects were accounted for under real estate accounting guidance, under which no separate allocation to the company’s project development efforts occurs and the amount of revenue and margin that is recognized may be limited in circumstances where the company has certain forms of continuing involvement in the project. Under ASC 606, such projects are accounted for when the customer obtains control of the promised goods or services which generally results in earlier recognition of revenue and margin than previous GAAP. Over the life of each project, cumulative revenue and gross profit will eventually be equivalent under both ASC 606 and non-GAAP once these projects are completed. |
• | Legacy sale-leaseback transactions: The company includes adjustments primarily related to revenue recognition on certain legacy sale-leaseback transactions based on the net proceeds received from the buyer-lessor. Under GAAP, these transactions were accounted for under the financing method in accordance with the applicable accounting guidance. Under such guidance, no revenue or profit is recognized at the inception of the transaction, and the net proceeds from the buyer-lessor are recorded as a financing liability. Imputed interest is recorded on the liability equal to the company’s incremental borrowing rate adjusted solely to prevent negative amortization. Under IFRS, revenue and profit are recognized at the time of sale to the buyer-lessor if certain criteria are met. |
• | Unrealized (gain) loss in equity investments: The company recognizes adjustments related to the fair value of equity investments with readily determinable fair value based on the changes in the stock price of these equity investments at every reporting period. Under GAAP, unrealized gains and losses due to changes in stock prices for these securities are recorded in earnings while under IFRS, an election can be made to recognize such gains and losses in other comprehensive income. Such an election was made by Total S.A. Management believes that excluding the unrealized gain or loss on the equity investments is consistent with the company's internal reporting process as part of its status as a consolidated subsidiary of Total S.A. and better reflects the company's ongoing results. |
• | Impairment and sale of residential lease assets: In the fourth quarter of fiscal 2017, the company made the decision to sell or refinance its interest in the residential lease portfolio and as a result of this triggering event, determined it was necessary to evaluate the potential for impairment in its ability to recover the carrying amount of the residential lease portfolio. In accordance with such evaluation, the company recognized a non-cash impairment charge on its solar power systems leased and to be leased and an allowance for losses related financing receivables. In connection with the impairment loss, the carrying values of the company's solar power systems leased and to be leased were reduced which resulted in lower depreciation charges. In the fourth quarter of fiscal 2018, the company sold membership units representing a 49% membership interest in its residential lease business and retained a 51% membership interest. The loss on divestment and the remaining unsold residential lease assets impairment with its corresponding depreciation savings are excluded from the company’s non-GAAP results as they are non-cash in nature and not reflective of ongoing operating results. |
• | Construction revenue on solar services contracts: Upon adoption of the new lease accounting guidance (“ASC 842”) in the first quarter of fiscal 2019, revenue and cost of revenue on solar services contracts with residential customers are recognized ratably over the term of those contracts, once the projects are placed in service. For non-GAAP results, the company recognizes revenue and cost of revenue upfront based on the expected cash proceeds to align with the legacy lease accounting guidance. Management believes it is |
• | Cost of above-market polysilicon: The company has entered into multiple long-term, fixed-price supply agreements to purchase polysilicon for periods of up to 10 years. The prices in select legacy supply agreements, which incorporate a cash portion and a non-cash portion attributable to the amortization of prepayments made under the agreements, significantly exceed current market prices. Additionally, in order to reduce inventory and improve working capital, the company has periodically elected to sell polysilicon inventory in the marketplace at prices below the company’s purchase price, thereby incurring a loss. Management believes that it is appropriate to exclude the impact of its above-market cost of polysilicon, including the effect of above-market polysilicon on product costs, losses incurred on sales of polysilicon to third parties, and inventory reserves and project asset impairments from the company's non-GAAP financial measures as they are not reflective of ongoing operating results and do not contribute to a meaningful evaluation of a company's past operating performance. |
• | Stock-based compensation: Stock-based compensation relates primarily to the company’s equity incentive awards. Stock-based compensation is a non-cash expense that is dependent on market forces that are difficult to predict. Management believes that this adjustment for stock-based compensation provides investors with a basis to measure the company's core performance, including compared with the performance of other companies, without the period-to-period variability created by stock-based compensation. |
• | Amortization of intangible assets: The company incurs amortization of intangible assets as a result of acquisitions, which includes patents, purchased technology, project pipeline assets, and in-process research and development. Management believes that it is appropriate to exclude these amortization charges from the company’s non-GAAP financial measures as they arise from prior acquisitions, are not reflective of ongoing operating results, and do not contribute to a meaningful evaluation of a company’s past operating performance. |
• | Depreciation of idle equipment: In the fourth quarter of 2017, the company changed the deployment plan for its next generation of solar cell technology, and revised its depreciation estimates to reflect the use of certain assets over its shortened useful life. Such asset depreciation is excluded from the company's non-GAAP financial measures as it is non-cash in nature and not reflective of ongoing operating results. Excluding this data provides investors with a basis to compare the company's performance against the performance of other companies without such charges. |
• | Gain on business divestiture: In the first quarter of fiscal 2019, the company entered into a transaction pursuant to which it sold membership interest in certain of its subsidiaries that own leasehold interests in projects subject to sale-leaseback financing arrangements. In connection with this sale, the company recognized a gain relating to this business divestiture. Management believes that it is appropriate to exclude this gain from our non-GAAP results as it is not reflective of ongoing operating results. |
• | Transaction-related costs: In connection with material transactions such as acquisition or divestiture of a business, the company incurred transaction costs including legal and accounting fees. Management believes that it is appropriate to exclude these costs from the company’s non-GAAP financial measures as they would not have otherwise been incurred as part of its business operations and are therefore not reflective of ongoing operating results. |
• | Business reorganization costs: In connection with the reorganization of our business into an upstream and downstream business unit structure, the company incurred and expect to continue incurring expenses in the upcoming quarters associated with reclassifying prior period segment information, reorganization of corporate functions and responsibilities to the business units, updating accounting policies and processes and implementing systems to fulfill the requirements of the master supply agreement between the segments. |
• | Non-cash interest expense: The company incurs non-cash interest expense related to the amortization of items such as original issuance discounts on its debt. The company excludes non-cash interest expense because the expense does not reflect its financial results in the period incurred. Management believes that this adjustment for non-cash interest expense provides investors with a basis to evaluate the company's performance, including compared with the performance of other companies, without non-cash interest expense. |
• | Restructuring expenses: The company incurs restructuring expenses related to reorganization plans aimed towards realigning resources consistent with the company’s global strategy and improving its overall operating efficiency and cost structure. Restructuring charges are excluded from non-GAAP financial measures because they are not considered core operating activities and such costs have historically occurred infrequently. Although the company has engaged in restructuring activities in the past, each has been a discrete event based on a unique set of business objectives. As such, management believes that it is appropriate to exclude restructuring charges from the company's non-GAAP financial measures as they are not reflective of ongoing operating results or contribute to a meaningful evaluation of a company's past operating performance. |
• | Tax effect: This amount is used to present each of the adjustments described above on an after-tax basis in connection with the presentation of non-GAAP net income (loss) and non-GAAP net income (loss) per diluted share. The company's non-GAAP tax amount is based on estimated cash tax expense and reserves. The company forecasts its annual cash tax liability and allocates the tax to each quarter in a manner generally consistent with its GAAP methodology. This approach is designed to enhance investors’ ability to understand the impact of the company's tax expense on its current operations, provide improved modeling accuracy, and substantially reduce fluctuations caused by GAAP to non-GAAP adjustments, which may not reflect actual cash tax expense. |
• | Adjusted EBITDA adjustments. When calculating Adjusted EBITDA, in addition to adjustments described above, the company excludes the impact of the following items during the period: |
• | Cash interest expense, net of interest income |
• | Provision for (benefit from) income taxes |
• | Depreciation |
THREE MONTHS ENDED | ||||||||||||
March 31, 2019 | December 30, 2018 | April 1, 2018 | ||||||||||
GAAP revenue | $ | 348,225 | $ | 456,837 | $ | 391,888 | ||||||
Adjustments based on IFRS: | ||||||||||||
8point3 | — | — | (251 | ) | ||||||||
Legacy utility and power plant projects | (171 | ) | (691 | ) | (1,792 | ) | ||||||
Legacy sale-leaseback transactions | — | 69,254 | 9,103 | |||||||||
Construction revenue on solar services contracts | 63,505 | — | — | |||||||||
Non-GAAP revenue | $ | 411,559 | $ | 525,400 | $ | 398,948 |
THREE MONTHS ENDED | ||||||||||||
March 31, 2019 | December 30, 2018 | April 1, 2018 | ||||||||||
GAAP gross profit (loss) | $ | (37,285 | ) | $ | (7,571 | ) | $ | 10,574 | ||||
Adjustments based on IFRS: | ||||||||||||
Legacy utility and power plant projects | 116 | (569 | ) | (268 | ) | |||||||
Legacy sale-leaseback transactions | (823 | ) | 6,132 | (3,039 | ) | |||||||
Other adjustments: | ||||||||||||
Impairment and sale of residential lease assets | (125 | ) | (2,163 | ) | (3,853 | ) | ||||||
Construction revenue on solar services contracts | 11,386 | — | — | |||||||||
Cost of above-market polysilicon | 49,428 | 37,231 | 18,700 | |||||||||
Stock-based compensation expense | 168 | 1,236 | 941 | |||||||||
Amortization of intangible assets | 1,786 | 1,889 | 2,492 | |||||||||
Depreciation of idle equipment | — | — | 721 | |||||||||
Non-GAAP gross profit | $ | 24,651 | $ | 36,185 | $ | 26,268 | ||||||
GAAP gross margin (%) | (10.7 | )% | (1.7 | )% | 2.7 | % | ||||||
Non-GAAP gross margin (%) | 6.0 | % | 6.9 | % | 6.6 | % |
THREE MONTHS ENDED | ||||||||||||
March 31, 2019 | December 30, 2018 | April 1, 2018 | ||||||||||
GAAP net loss attributable to stockholders | $ | (89,724 | ) | $ | (158,174 | ) | $ | (115,974 | ) | |||
Adjustments based on IFRS: | ||||||||||||
8point3 | — | — | (177 | ) | ||||||||
Legacy utility and power plant projects | 116 | (569 | ) | (268 | ) | |||||||
Legacy sale-leaseback transactions | 4,911 | 10,984 | 1,373 | |||||||||
Unrealized (gain) loss on equity investment | (33,000 | ) | 150 | — | ||||||||
Other adjustments: | ||||||||||||
Impairment and sale of residential lease assets | 8,313 | 81,273 | 45,139 | |||||||||
Construction revenue on solar services contracts | (3,740 | ) | — | — | ||||||||
Cost of above-market polysilicon | 49,428 | 37,231 | 18,700 | |||||||||
Stock-based compensation expense | 5,666 | 6,424 | 8,758 | |||||||||
Amortization of intangible assets | 1,786 | 1,889 | 2,492 | |||||||||
Depreciation of idle equipment | — | — | 721 | |||||||||
Gain on business divestiture | (6,114 | ) | — | — | ||||||||
Transaction-related costs | 1,422 | (3,142 | ) | — | ||||||||
Business reorganization costs | 2,649 | 1,330 | — | |||||||||
Non-cash interest expense | 10 | 10 | 22 | |||||||||
Restructuring charges (credits) | (665 | ) | (1,107 | ) | 11,177 | |||||||
Tax effect | 1,518 | (6,605 | ) | (170 | ) | |||||||
Non-GAAP net loss attributable to stockholders | $ | (57,424 | ) | $ | (30,306 | ) | $ | (28,207 | ) |
THREE MONTHS ENDED | ||||||||||||
March 31, 2019 | December 30, 2018 | April 1, 2018 | ||||||||||
Net loss per diluted share | ||||||||||||
Numerator: | ||||||||||||
GAAP net loss available to common stockholders1 | $ | (89,724 | ) | $ | (158,174 | ) | $ | (115,974 | ) | |||
Non-GAAP net loss available to common stockholders1 | $ | (57,424 | ) | $ | (30,306 | ) | $ | (28,207 | ) | |||
Denominator: | ||||||||||||
GAAP weighted-average shares | 141,720 | 141,136 | 140,212 | |||||||||
Effect of dilutive securities: | ||||||||||||
Restricted stock units | — | — | — | |||||||||
Upfront warrants (held by Total) | — | — | — | |||||||||
Non-GAAP weighted-average shares1 | 141,720 | 141,136 | 140,212 | |||||||||
GAAP net loss per diluted share | $ | (0.63 | ) | $ | (1.12 | ) | $ | (0.83 | ) | |||
Non-GAAP net loss per diluted share | $ | (0.41 | ) | $ | (0.21 | ) | $ | (0.20 | ) |
THREE MONTHS ENDED | ||||||||||||
March 31, 2019 | December 30, 2018 | April 1, 2018 | ||||||||||
GAAP net loss attributable to stockholders | $ | (89,724 | ) | $ | (158,174 | ) | $ | (115,974 | ) | |||
Adjustments based on IFRS: | ||||||||||||
8point3 | — | — | (177 | ) | ||||||||
Legacy utility and power plant projects | 116 | (569 | ) | (268 | ) | |||||||
Legacy sale-leaseback transactions | 4,911 | 10,984 | 1,373 | |||||||||
Unrealized (gain) loss on equity investment | (33,000 | ) | 150 | — | ||||||||
Other adjustments: | ||||||||||||
Impairment and sale of residential lease assets | 8,313 | 81,273 | 45,139 | |||||||||
Construction revenue on solar services contracts | (3,740 | ) | — | — | ||||||||
Cost of above-market polysilicon | 49,428 | 37,231 | 18,700 | |||||||||
Stock-based compensation expense | 5,666 | 6,424 | 8,758 | |||||||||
Amortization of intangible assets | 1,786 | 1,889 | 2,492 | |||||||||
Depreciation of idle equipment | — | — | 721 | |||||||||
Gain on business divestiture | (6,114 | ) | — | — | ||||||||
Transaction-related costs | 1,422 | (3,142 | ) | — | ||||||||
Business reorganization costs | 2,649 | 1,330 | — | |||||||||
Non-cash interest expense | 10 | 10 | 22 | |||||||||
Restructuring charges (credits) | (665 | ) | (1,107 | ) | 11,177 | |||||||
Cash interest expense, net of interest income | 10,206 | 24,584 | 20,165 | |||||||||
Provision for (benefit from) income taxes | 5,797 | (8,379 | ) | 2,628 | ||||||||
Depreciation | 19,181 | 21,054 | 37,576 | |||||||||
Adjusted EBITDA | $ | (23,758 | ) | $ | 13,558 | $ | 32,332 |
(in thousands except percentages) | Q2 2019 | FY 2019 |
Revenue (GAAP) | $370,000-$410,000 | $1,800,000-$1,900,000 |
Revenue (non-GAAP)1 | $420,000-$460,000 | $1,900,000-$2,000,000 |
Gross margin (GAAP) | 0% - 3% | N/A |
Gross margin (non-GAAP)2 | 7% - 10% | N/A |
Net income (loss) (GAAP) | $0-$20,000 | $(120,000)-$(100,000) |
Adjusted EBITDA3 | $(5,000)-$15,000 | $90,000-$110,000 |
1. | Estimated non-GAAP amounts above for Q2 2019 and fiscal 2019 include net adjustments that increase revenue by approximately $50 million and $114 million, respectively, related to construction revenue on solar services contracts. |
2. | Estimated non-GAAP amounts above for Q2 2019 include net adjustments that increase gross margin by approximately $24 million related to cost of above-market polysilicon, $4 million related to construction revenue on solar services contracts, $2 million related to stock-based compensation expense, and $2 million related to amortization of intangible assets. |
3. | Estimated Adjusted EBITDA amounts above for Q2 2019 include net adjustments that increase (decrease) net income by approximately $24 million related to cost of above-market polysilicon, $17 million related to depreciation, $15 million related to impairment of lease assets, $10 million related to interest expense, $8 million related to stock-based compensation expense, $6 million related to income taxes, $5 million related to business reorganization costs, $2 million related to amortization of intangible assets, $2 million related to restructuring, $(91) million related to the gain on sale of our membership interest in the commercial sale-leaseback portfolio, and $(3) million related to construction revenue on solar services contracts. Estimated non-GAAP amounts above for fiscal 2019 include net adjustments that decrease (increase) net loss by approximately $132 million related to cost of above-market polysilicon, $70 million related to depreciation, $40 million related to interest expense, $32 million related to impairment of lease assets, $30 million related to stock-based compensation expense, $16 million related to income taxes, $16 million related to business reorganization costs, $8 million related to amortization of intangible assets, $4 million related to restructuring, $2 million related to transaction-related costs, $(97) million related to the gain on sale of our membership interest in the commercial sale-leaseback portfolio, $(33) million related to unrealized gain on equity investment, $(6) million related to gain on sale of previously impaired project assets, and $(4) million related to construction revenue on solar services contracts. |
March 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue | Gross Profit / Margin | Operating expenses | Other income (expense), net | Benefit from (provision for) income taxes | Gain (Loss) attributable to non-controlling interests | Net income (loss) attributable to stockholders | |||||||||||||||||||||||||||||||||||||||||||||||||||
SunPower Energy Services | SunPower Technologies | Intersegment eliminations | SunPower Energy Services | SunPower Technologies | Intersegment eliminations | Research and development | Sales, general and administrative | Restructuring credits | Impairment of residential lease assets | Gain on business divestiture | |||||||||||||||||||||||||||||||||||||||||||||||
GAAP | $ | 178,221 | $ | 230,804 | $ | (60,800 | ) | $ | 7,143 | 4.0 | % | $ | (52,064 | ) | (22.6 | )% | $ | 7,636 | $ | (89,724 | ) | ||||||||||||||||||||||||||||||||||||
Adjustments based on IFRS: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legacy utility and power plant projects | — | (171 | ) | — | 125 | (9 | ) | — | — | — | — | — | — | — | — | — | 116 | ||||||||||||||||||||||||||||||||||||||||
Legacy sale-leaseback transactions | — | — | — | (824 | ) | 1 | — | — | — | — | — | — | 5,734 | — | — | 4,911 | |||||||||||||||||||||||||||||||||||||||||
Unrealized gain on equity investment | — | — | — | — | — | — | — | — | — | — | — | (33,000 | ) | — | — | (33,000 | ) | ||||||||||||||||||||||||||||||||||||||||
Other adjustments: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Impairment of residential lease assets | — | — | — | (125 | ) | — | — | — | — | — | 9,226 | — | — | — | (788 | ) | 8,313 | ||||||||||||||||||||||||||||||||||||||||
Construction revenue on solar services contracts | 63,505 | — | — | 11,386 | — | — | — | — | — | — | — | — | — | (15,126 | ) | (3,740 | ) | ||||||||||||||||||||||||||||||||||||||||
Cost of above-market polysilicon | — | — | — | — | 49,428 | — | — | — | — | — | — | — | — | — | 49,428 | ||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | 168 | — | — | 593 | 4,905 | — | — | — | — | — | — | 5,666 | ||||||||||||||||||||||||||||||||||||||||||
Amortization of intangible assets | — | — | — | — | 1,786 | — | — | — | — | — | — | — | — | — | 1,786 | ||||||||||||||||||||||||||||||||||||||||||
Gain on business divestiture | — | — | — | — | — | — | — | — | — | — | (6,114 | ) | — | — | — | (6,114 | ) | ||||||||||||||||||||||||||||||||||||||||
Business reorganization costs | — | — | — | — | — | — | — | 2,649 | — | — | — | — | — | — | 2,649 | ||||||||||||||||||||||||||||||||||||||||||
Transaction-related costs | — | — | — | — | — | — | — | 1,422 | — | — | — | — | — | — | 1,422 | ||||||||||||||||||||||||||||||||||||||||||
Non-cash interest expense | — | — | — | — | — | — | — | 10 | — | — | — | — | — | — | 10 | ||||||||||||||||||||||||||||||||||||||||||
Restructuring credits | — | — | — | — | — | — | — | — | (665 | ) | — | — | — | — | — | (665 | ) | ||||||||||||||||||||||||||||||||||||||||
Tax effect | — | — | — | — | — | — | — | — | — | — | — | — | 1,518 | — | 1,518 | ||||||||||||||||||||||||||||||||||||||||||
Non-GAAP | $ | 241,726 | $ | 230,633 | $ | (60,800 | ) | $ | 17,873 | 7.4 | % | $ | (858 | ) | (0.4 | )% | $ | 7,636 | $ | (57,424 | ) |
December 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue | Gross Profit / Margin | Operating expenses | Benefit from (provision for) income taxes | Gain (Loss) attributable to non-controlling interests | Net income (loss) attributable to stockholders | |||||||||||||||||||||||||||||||||||||||||||||||||
SunPower Energy Services | SunPower Technologies | Intersegment eliminations | SunPower Energy Services | SunPower Technologies | Intersegment eliminations | Research and development | Sales, general and administrative | Restructuring credits | Impairment and sale of residential lease assets | |||||||||||||||||||||||||||||||||||||||||||||
GAAP | $ | 265,427 | $ | 277,256 | $ | (85,846 | ) | $ | 20,126 | 7.6 | % | $ | (19,616 | ) | (7.1 | )% | $ | (8,081 | ) | $ | (158,174 | ) | ||||||||||||||||||||||||||||||||
Adjustments based on IFRS: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legacy utility and power plant projects | (240 | ) | (451 | ) | — | (472 | ) | (97 | ) | — | — | — | — | — | — | — | — | (569 | ) | |||||||||||||||||||||||||||||||||||
Legacy sale-leaseback transactions | 69,254 | — | — | 6,113 | 19 | — | — | — | — | — | 4,852 | — | — | 10,984 | ||||||||||||||||||||||||||||||||||||||||
Unrealized loss on equity investment | — | — | — | — | — | — | — | — | — | — | 150 | — | — | 150 | ||||||||||||||||||||||||||||||||||||||||
Other adjustments: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Impairment and sale of residential lease assets | — | — | — | (2,163 | ) | — | — | — | — | — | 81,086 | — | — | 2,350 | 81,273 | |||||||||||||||||||||||||||||||||||||||
Cost of above-market polysilicon | — | — | — | 2,055 | 35,176 | — | — | — | — | — | — | — | — | 37,231 | ||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | 610 | 626 | — | 907 | 4,281 | — | — | — | — | — | 6,424 | ||||||||||||||||||||||||||||||||||||||||
Amortization of intangible assets | — | — | — | 616 | 1,273 | — | — | — | — | — | — | — | — | 1,889 | ||||||||||||||||||||||||||||||||||||||||
Business reorganization costs | — | — | — | — | — | — | — | 1,330 | — | — | — | — | — | 1,330 | ||||||||||||||||||||||||||||||||||||||||
Transaction-related costs | — | — | — | — | — | — | — | (3,142 | ) | — | — | — | — | — | (3,142 | ) | ||||||||||||||||||||||||||||||||||||||
Non-cash interest expense | — | — | — | — | — | — | — | 10 | — | — | — | — | — | 10 | ||||||||||||||||||||||||||||||||||||||||
Restructuring credits | — | — | — | — | — | — | — | — | (1,107 | ) | — | — | — | — | (1,107 | ) | ||||||||||||||||||||||||||||||||||||||
Tax effect | — | — | — | — | — | — | — | — | — | — | — | (6,605 | ) | — | (6,605 | ) | ||||||||||||||||||||||||||||||||||||||
Non-GAAP | $ | 334,441 | $ | 276,805 | $ | (85,846 | ) | $ | 26,885 | 8.0 | % | $ | 17,381 | 6.3 | % | $ | (8,081 | ) | $ | (30,306 | ) |
April 1, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue | Gross Profit / Margin | Operating expenses | Other income (expense), net | Benefit from (provision for) income taxes | Equity in earnings of unconsolidated investees | Gain (Loss) attributable to non-controlling interests | Net income (loss) attributable to stockholders | ||||||||||||||||||||||||||||||||||||||||||||||||||
SunPower Energy Services | SunPower Technologies | Intersegment eliminations | SunPower Energy Services | SunPower Technologies | Intersegment eliminations | Research and development | Selling, general and administrative | Restructuring charges | Impairment and sale of residential lease assets | ||||||||||||||||||||||||||||||||||||||||||||||||
GAAP | $ | 246,928 | $ | 253,834 | $ | (108,874 | ) | $ | 40,925 | 16.6 | % | $ | (24,207 | ) | (9.5 | )% | $ | (6,144 | ) | $ | (115,974 | ) | |||||||||||||||||||||||||||||||||||
Adjustments based on IFRS: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
8point3 | (251 | ) | — | — | — | — | — | — | — | — | — | — | — | (177 | ) | — | (177 | ) | |||||||||||||||||||||||||||||||||||||||
Legacy utility and power plant projects | (392 | ) | (1,400 | ) | — | (450 | ) | 182 | — | — | — | — | — | — | — | — | — | (268 | ) | ||||||||||||||||||||||||||||||||||||||
Legacy sale-leaseback transactions | 9,103 | — | — | (3,039 | ) | — | — | — | — | — | — | 4,412 | — | — | — | 1,373 | |||||||||||||||||||||||||||||||||||||||||
Other adjustments: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Impairment of residential lease assets | — | — | — | (3,853 | ) | — | — | — | — | — | 49,092 | — | — | — | (100 | ) | 45,139 | ||||||||||||||||||||||||||||||||||||||||
Cost of above-market polysilicon | — | — | — | — | 18,700 | — | — | — | — | — | — | — | — | — | 18,700 | ||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | 361 | 580 | — | 2,877 | 4,940 | — | — | — | — | — | — | 8,758 | ||||||||||||||||||||||||||||||||||||||||||
Amortization of intangible assets | — | — | — | 1,402 | 1,090 | — | — | — | — | — | — | — | — | — | 2,492 | ||||||||||||||||||||||||||||||||||||||||||
Depreciation of idle equipment | — | — | — | 289 | 432 | — | — | — | — | — | — | — | — | — | 721 | ||||||||||||||||||||||||||||||||||||||||||
Non-cash interest expense | — | — | — | — | — | — | 3 | 19 | — | — | — | — | — | — | 22 | ||||||||||||||||||||||||||||||||||||||||||
Restructuring charges | — | — | — | — | — | — | — | — | 11,177 | — | — | — | — | — | 11,177 | ||||||||||||||||||||||||||||||||||||||||||
Tax effect | — | — | — | — | — | — | — | — | — | — | — | (170 | ) | — | — | (170 | ) | ||||||||||||||||||||||||||||||||||||||||
Non-GAAP | $ | 255,388 | $ | 252,434 | $ | (108,874 | ) | $ | 35,635 | 14.0 | % | $ | (3,223 | ) | (1.3 | )% | $ | (6,144 | ) | $ | (28,207 | ) |