Financial Data and Key Metrics Changes - The company achieved $275 million in revenue for Q4 2024 and $916 million for the full year, exceeding the midpoint of previously communicated guidance [12][52] - Q4 adjusted gross margin improved by 410 basis points year-on-year to 29.8%, while full year adjusted gross margin reached 34.1%, an increase of 680 basis points compared to 2023 [12][53] - Adjusted EBITDA for Q4 was $45.2 million, with a full year total of $173.6 million, down from $288.1 million in the prior year [12][54] - The net loss attributable to common shareholders for Q4 was $141.2 million, compared to a net income of $6 million in the prior year [51][54] - Free cash flow for the year was $135 million, ending with a cash balance of $364 million [12][55] Business Line Data and Key Metrics Changes - The order book ended the year at $2 billion, up 10% from 2023, with over 20% growth in the domestic portion [17] - The OmniTrack terrain following tracker contributed almost 10% of 2024 revenue, reflecting strong market traction [18] Market Data and Key Metrics Changes - Utility scale solar remains the cheapest and fastest-growing energy source, with solar and solar plus battery storage representing 64% of new electricity deployment in the U.S. [21] - The U.S. market stabilized towards the end of 2024, with expectations for continued momentum in 2025 despite previous headwinds [22][29] Company Strategy and Development Direction - The company is focused on supply chain resiliency, with a new manufacturing facility in Albuquerque aimed at reducing costs and risks [13] - Continued investment in innovation, including partnerships with companies like SWAP Robotics, to enhance operational efficiency and project cycle times [37][38] - The company aims to provide 100% domestic content trackers in the U.S. by the first half of 2025 [26][40] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the utility scale solar industry's value proposition and demand, expecting 20% top-line growth in 2025 [29][66] - The company is taking a conservative approach to forecasting for 2025, with expectations for revenue between $1.05 billion and $1.15 billion [59] Other Important Information - The company experienced significant impairment charges related to the 2022 STI acquisition, impacting operating expenses [49] - The company is actively monitoring developments regarding the Inflation Reduction Act and its implications for the solar industry [24][26] Q&A Session Summary Question: Can you discuss the EBITDA margin in Q1 compared to the rest of the year? - Management indicated that Q1 EBITDA margins are expected to be lower due to the continuation of large shipments from Q4 and the roll-off of some amortization [70] Question: What initiatives are being taken to grow the backlog? - Management noted a strong win rate for new orders, with a book-to-bill ratio of 1.5 in North America, despite some debookings in Brazil [78] Question: What pricing dynamics are expected in 2025? - Management stated that pricing remains disciplined, with commodity prices impacting ASPs rather than aggressive pricing strategies [82] Question: How does the competitive environment look after Soltec's exit in Europe? - Management acknowledged gaining market share in Brazil but noted legal constraints in Spain preventing immediate project takeovers [108] Question: Are there plans to sell off any 45X credits? - Management indicated that selling credits is not a near-term plan, as most credits are filed by vendors, but they would evaluate selling excess credits in the future [113]

Array Technologies, Inc. (NASDAQ:ARRY) Q4 2024 Earnings Conference Call February 27, 2025 5:00 PM ET Company Participants Gina Gunning - Chief Legal Officer & Corporate Secretary Kevin Hostetler - Chief Executive Officer Neil Manning - President & Chief Operating Officer Keith Jennings - Chief Financial Officer Conference Call Participants Mark Strouse - JPMorgan Vikram Bagri - Citigroup Brian Lee - Goldman Sachs Joe Osha - Guggenheim Partners Maheep Mandloi - Mizuho Securities Colin Rusch - Oppenheimer Phi ...

Investment Rating - The report maintains a neutral investment rating for Array Technologies, indicating that the stock's total return over the next 12-18 months is expected to be in line with the return of its relevant broad market benchmark [14]. Core Insights - Array Technologies reported adjusted EBITDA slightly below market expectations for the fourth quarter, leading to a negative market reaction. The company also reported a net loss due to impairment related to its STI acquisition [1][2]. - For the fiscal year 2025, Array provided revenue guidance of $1.05 to $1.15 billion, representing a year-over-year growth of 15-26%, while adjusted EBITDA guidance is set at $180 to $200 million, which is below the market expectation of $233 million [2][3]. - The company acknowledged ongoing headwinds in the utility-scale solar market but remains optimistic about moderate growth in Europe, despite challenges in Brazil due to currency depreciation and new tariffs on solar components [1][2]. Financial Performance Summary - In Q4 2024, Array reported net revenue of $275 million, a 19% decrease quarter-over-quarter and a 7% decrease year-over-year, with a gross profit margin of 28% [3][6]. - The adjusted net income for Q4 2024 was a loss of $141 million, primarily due to a $74 million non-cash goodwill impairment and a $92 million non-cash long-term intangible asset write-down related to the STI acquisition [3][6]. - The company reaffirmed a strong order backlog of $2 billion, consistent with previous quarters, indicating stable demand despite market challenges [2][3].

Core Insights - Array Technologies, Inc. reported quarterly earnings of $0.16 per share, missing the Zacks Consensus Estimate of $0.17 per share, and down from $0.21 per share a year ago, representing an earnings surprise of -5.88% [1] - The company posted revenues of $275.23 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 3.15%, but down from $341.62 million year-over-year [2] - Array Technologies has outperformed the S&P 500, gaining approximately 13.6% since the beginning of the year compared to the S&P 500's gain of 1.3% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.08 on revenues of $210.05 million, and for the current fiscal year, it is $0.77 on revenues of $1.12 billion [7] - The estimate revisions trend for Array Technologies is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Solar industry, to which Array Technologies belongs, is currently ranked in the top 20% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Another company in the same industry, FTC Solar, is expected to report a quarterly loss of $0.83 per share, reflecting a year-over-year change of -3.8%, with revenues projected to decline by 50.3% from the previous year [9]

Revenue Performance - Fourth quarter 2024 revenue reached $275.2 million, exceeding the mid-point of guidance[4] - Full year 2024 revenue totaled $915.8 million, with a gross margin of 32.5%[4] - Total revenue for the year ended December 31, 2024, was $915.8 million, a decrease of 42% compared to $1.58 billion in 2023[24] - Revenue for the three months ended December 31, 2024, was $275,232 thousand, a decrease from $341,615 thousand in the same period of 2023, representing a decline of approximately 19.4%[29] - ARRAY expects over 20% year-over-year revenue growth for 2025 at the midpoint of guidance[5] - The company anticipates first quarter 2025 revenue in the range of $260 million to $270 million[7] Profitability and Loss - The company reported a net loss to common shareholders of $(296.1) million for the full year, including a $236.0 million non-cash goodwill impairment charge[4] - Adjusted EBITDA for the fourth quarter was $45.2 million, while the full year adjusted EBITDA was $173.6 million[4] - Gross profit for the year ended December 31, 2024, was $297.7 million, down from $415.6 million in 2023, reflecting a gross margin of approximately 32.5%[24] - The company reported a net loss of $240.4 million for the year ended December 31, 2024, compared to a net income of $137.2 million in 2023[24] - Net loss for the three months ended December 31, 2024, was $(126,903) thousand, compared to a net income of $19,342 thousand in the same period of 2023[30] - Adjusted net income for the three months ended December 31, 2024, was $25,117 thousand, slightly down from $26,415 thousand in the same period of 2023[30] Cash and Liabilities - Cash and cash equivalents increased to $363.0 million as of December 31, 2024, from $249.1 million in 2023[22] - Total current liabilities rose to $437.8 million in 2024, up from $335.7 million in 2023, indicating a 30% increase[24] - The company experienced a significant increase in accounts payable, which rose to $172.4 million in 2024 from $119.5 million in 2023[24] - Cash paid for interest in the year ended December 31, 2024, was $38,655 thousand, down from $43,949 thousand in 2023[28] - Cash and cash equivalents at the end of the period were $364,141 thousand, an increase from $249,080 thousand at the end of the previous year[28] Operating Expenses - Operating expenses for the year ended December 31, 2024, totaled $524.7 million, significantly higher than $201.4 million in 2023[24] - General and administrative expenses for the three months ended December 31, 2024, were $45,663 thousand, an increase of 4.5% from $43,710 thousand in 2023[31] - Adjusted general and administrative expenses for the three months ended December 31, 2024, were $25,299 thousand, a decrease of 40.7% compared to $42,581 thousand in 2023[31] Shareholder Information - The weighted average common shares outstanding for the year ended December 31, 2024, was 151.8 million, compared to 150.9 million in 2023[24] - The weighted average number of common shares outstanding for the three months ended December 31, 2024, was 151,944 thousand, compared to 151,175 thousand in the same period of 2023[30] - The company reported a basic loss per common share of $1.95 for the year ended December 31, 2024, compared to earnings of $0.57 per share in 2023[24] Goodwill and Impairment - The company recorded a goodwill impairment of $236.0 million for the year ended December 31, 2024[24] - The company reported a goodwill impairment of $74,000 thousand for the three months ended December 31, 2024[30] Future Outlook - The OmniTrack™ product now accounts for over 20% of the company's order book[4] - ARRAY is on track to deliver 100% domestic content solar trackers by the first half of 2025[4] - Adjusted net income per share for 2025 is projected to be between $0.60 and $0.70[7] Cash Flow - For the three months ended December 31, 2024, net cash provided by operating activities was $57,586 thousand, a decrease of 38.6% compared to $93,981 thousand for the same period in 2023[32] - Free cash flow for the three months ended December 31, 2024, was $44,609 thousand, down 49.6% from $88,607 thousand in the prior year[32] Legal and Other Costs - The company incurred $2,240 thousand in certain legal expenses for the three months ended December 31, 2024, compared to $244 thousand in the same period of 2023[31] - Other costs for the three months ended December 31, 2024, included $2,586 thousand related to Capped-Call accounting treatment evaluation[31] - The total estimated tax impact of all Adjusted Net Income add-backs for the year ended December 31, 2024, was $(42,596) thousand, compared to $(20,863) thousand for 2023[31] Capital Expenditures - The purchase of property, plant, and equipment for the year ended December 31, 2024, was $7,305 thousand, down from $16,989 thousand in 2023[32] Litigation - The company is awaiting a decision on an appeal related to litigation dismissed with prejudice on May 19, 2023[31]

Financial Performance - ARRAY Technologies reported fourth quarter revenue of $275.2 million, exceeding the mid-point of guidance, with a gross margin of 28.5% and an adjusted gross margin of 29.8% [7][4] - For the full year 2024, the company achieved revenue of $915.8 million, a gross margin of 32.5%, and an adjusted gross margin of 34.1% [7][4] - The net loss to common shareholders for the fourth quarter was $(141.2) million, which included a non-cash goodwill impairment charge of $74.0 million and a long-lived intangible asset write-down of $91.9 million related to the 2022 STI acquisition [7][4] Operational Highlights - ARRAY finished 2024 with an order book of $2 billion, reflecting a 10% year-on-year growth [4] - The company's OmniTrack™ product now represents over 20% of the order book, indicating strong market traction [4] - ARRAY is on track to deliver 100% domestic content solar trackers by the first half of 2025 [4] Market Outlook - The company anticipates over 20% year-over-year revenue growth for 2025, despite facing headwinds such as permitting delays and labor constraints [5] - In Europe, modest growth is expected in 2025, while Brazil's growth is impacted by macroeconomic factors like currency devaluation and tariffs [5] - ARRAY remains optimistic about future demand for utility-scale solar energy both domestically and internationally [5] Cash Flow and Financial Position - Free cash flow for the year was reported at $135.4 million, indicating strong cash generation capabilities [7] - Total executed contracts and awarded orders as of December 31, 2024, stood at $2.0 billion [7] Guidance - For the first quarter of 2025, ARRAY expects revenue in the range of $260 million to $270 million, with an adjusted EBITDA margin between 11% to 13% [11] - For the full year 2025, revenue is projected to be between $1.05 billion and $1.15 billion, with adjusted EBITDA expected to range from $180 million to $200 million [11]

Core Insights - The article does not provide specific insights or analysis regarding any companies or industries, focusing instead on disclaimers and disclosures related to the author's position and affiliations [1][2]. Group 1 - No stock, option, or similar derivative positions are held by the author in any mentioned companies, nor are there plans to initiate such positions in the near future [1]. - The article expresses the author's personal opinions and does not reflect the views of Seeking Alpha as a whole [2]. - The content does not provide any investment recommendations or advice regarding the suitability of investments for particular investors [2].

Company Performance - Array Technologies, Inc. closed at $7.21, down 1.23% from the previous trading session, underperforming the S&P 500's gain of 0.67% [1] - Over the past month, shares have appreciated by 13.53%, outperforming the Oils-Energy sector's loss of 0.76% and the S&P 500's gain of 2.07% [1] Upcoming Earnings - The company is set to announce its earnings on February 27, 2025, with projected earnings per share (EPS) of $0.17, reflecting a 19.05% decrease from the same quarter last year [2] - Revenue is estimated to be $266.83 million, indicating a 21.89% decrease compared to the same quarter of the previous year [2] Analyst Estimates - Changes in analyst estimates for Array Technologies, Inc. are important as they reflect shifting business dynamics, with positive revisions indicating a favorable outlook on the company's health and profitability [3] - The Zacks Consensus EPS estimate has moved 0.17% lower over the last 30 days, and the company currently holds a Zacks Rank of 3 (Hold) [5] Valuation Metrics - Array Technologies, Inc. is trading at a Forward P/E ratio of 9.49, which is a discount compared to the industry average Forward P/E of 9.85 [6] - The company's PEG ratio is currently 0.8, while the average PEG ratio for solar stocks is 0.67 [6] Industry Context - The Solar industry, part of the Oils-Energy sector, has a Zacks Industry Rank of 78, placing it in the top 32% of over 250 industries [7] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [7]

Core Viewpoint - ARRAY Technologies, Inc. is set to release its fourth quarter and full year 2024 financial results on February 27, 2025, followed by a conference call to discuss the results [1]. Financial Results Announcement - The financial results will be announced after market close on February 27, 2025 [1]. - A conference call will take place at 5:00 p.m. (Eastern Time) on the same day [1]. Conference Call Details - The conference call can be accessed by phone at (877)-869-3847 for domestic calls and (201)-689-8261 for international calls [2]. - A telephonic replay will be available approximately three hours after the call, accessible at (877)-660-6853 for domestic and (201)-612-7415 for international callers, with a passcode of 13750627 [2]. - The replay will be available until 11:59 p.m. (ET) on March 13, 2025 [2]. Webcast Information - Interested parties can also listen to a simultaneous webcast of the conference call via the Investor Relations section of the company's website [3]. - The online replay will be available for a limited time starting immediately after the call [3]. Company Overview - ARRAY Technologies is a leading global renewable energy company specializing in utility-scale solar tracking technology [4]. - The company’s solar trackers and software are designed to maximize energy production and support the adoption of sustainable energy solutions [4]. - Founded and headquartered in the United States, ARRAY leverages a diversified global supply chain and a customer-centric approach to support solar energy developments worldwide [4].

Core Viewpoint - ARRAY Technologies has appointed Gina Gunning as the new chief legal officer and corporate secretary, bringing over 25 years of legal and compliance experience to the company [1][2]. Group 1: Appointment Details - Gina Gunning will report directly to ARRAY's CEO, Kevin G. Hostetler, and will relocate to Chandler, Arizona [1]. - Gunning's previous role was as Chief Legal Officer and Corporate Secretary at GrafTech International Ltd., where she managed the legal department and global litigation [2][3]. Group 2: Experience and Qualifications - Gunning is recognized for her expertise in corporate law, governance, compliance, and risk management, with a strong background in structuring complex transactions and navigating regulatory landscapes [2][3]. - Prior to GrafTech, she held senior legal positions at FirstEnergy Corp. and Cliffs Natural Resources Inc., focusing on mergers and acquisitions, securities law, and capital markets transactions [3]. Group 3: Responsibilities and Vision - As chief legal officer, Gunning will lead ARRAY's legal, compliance, and risk management teams, ensuring alignment with business objectives and adherence to legal standards [4]. - Her responsibilities will include providing strategic counsel on corporate governance, contracts, intellectual property, and environmental, social, and governance (ESG) initiatives [4]. Group 4: Company Overview - ARRAY Technologies is a leading global renewable energy company specializing in utility-scale solar tracking technology, designed to maximize energy production [6]. - The company emphasizes a customer-centric approach and relies on a diversified global supply chain to support solar energy developments worldwide [6].