Group 1: Market Performance - Solar stocks generally rose, with Array up 7.64%, Canadian Solar ADR up 5.62%, Sunrun up 4.96%, First Solar up 4.32%, SolarEdge up 3.23%, and JinkoSolar ADR up 2.72% [1][2] - The S&P 500 index is currently down 0.45%, the Dow Jones is down 104 points (0.49%), while the Nasdaq is up 13 points (0.31%) [1] Group 2: Regulatory Environment - The U.S. believes that imports of solar products from Southeast Asia harm the domestic industry, laying the groundwork for tariffs on these imports [1]

Core Insights - ARRAY Technologies has launched DuraTrack Hail XP™, an advanced solar tracker designed to withstand extreme hail and wind events, enhancing the reliability of solar assets in hail-prone regions [1][3] - The development of Hail XP involved direct input from customers, insurers, and industry partners, addressing severe weather risks that solar projects face today [2][3] - Hail XP features industry-leading protective stow angles and strong stow reliability, aiming to reduce downtime and damage to solar installations [3][6] Product Features - Hail XP operates without relying on batteries, ensuring maximum readiness when hail approaches [6] - It has a 77-degree stow capability, allowing modules to be positioned at a high tilt to mitigate hail impact regardless of wind conditions [6] - The product integrates seamlessly with ARRAY's SmarTrack® Hail Alert Response and patented Passive Wind Stow technologies, enhancing its protective features [6] - Enhanced durability is achieved through a reinforced bearing housing, larger gear rack, and upgraded damper, ensuring performance in harsh conditions [6] - Hail XP is expected to be available for first shipments in early 2026 [6] Company Overview - ARRAY Technologies is a leading global provider of solar tracking technology, focusing on utility-scale and distributed generation customers [4] - The company emphasizes its commitment to manufacturing and technology, leveraging a diversified global supply chain and a customer-centric approach [4]

Core Insights - ARRAY Technologies has launched DuraTrack Hail XP™, an advanced solar tracker designed to withstand extreme hail and wind events, enhancing the reliability of solar assets in hail-prone regions [1][3] - The development of Hail XP involved direct input from customers, insurers, and industry partners, addressing severe weather risks that solar projects face today [2][3] - Hail XP sets a new benchmark for tracker reliability, featuring industry-leading protective stow angles and strong stow reliability to reduce downtime and damage [3] Product Features - Hail XP operates without batteries, ensuring maximum readiness when hail approaches [6] - It has a 77-degree stow capability, allowing modules to be positioned at a high tilt to mitigate hail impact regardless of wind conditions [6] - The product integrates seamlessly with ARRAY's SmarTrack® Hail Alert Response and patented Passive Wind Stow technologies, enhancing its protective features [6] - Enhanced durability is achieved through a reinforced bearing housing, larger gear rack, and upgraded damper, ensuring performance in harsh conditions [6] - Hail XP is expected to be available for first shipments in early 2026 [6] Company Overview - ARRAY Technologies is a leading global provider of solar tracking technology, focusing on utility-scale and distributed generation customers [4] - The company emphasizes its commitment to manufacturing and technology, leveraging a diversified global supply chain and a customer-centric approach [4]

Company Overview - Array Technologies, Inc. was founded in 1989 and is based in Albuquerque, NM, specializing in solar tracking equipment and technology for the solar power industry, primarily for utility-scale installations [1] Industry Insights - The company provides solar trackers, which are systems that position solar panels to maximize sunlight exposure, thereby enhancing energy production [1] Investment Philosophy - The investment approach emphasizes the slow accumulation of high-quality assets, blending steady investment with high-risk, high-reward opportunities, and transformative technologies [1]

Revenue and Growth - Revenue for Q1 2025 reached $302.36 million, a 97% increase from $153.40 million in Q1 2024[173]. - Consolidated revenue increased by $149.0 million, or 97%, for the three months ended March 31, 2025, driven by Array Legacy Operations (86%) and STI Operations (128%) growth[175]. - Array Legacy Operations revenue grew by 86% to $213.21 million in Q1 2025, while STI Operations revenue increased by 128% to $89.15 million[174]. - Array Legacy Operations revenue rose by $98.8 million, or 86%, primarily due to a 116% increase in volume, despite a 14% decrease in average selling prices[176]. - STI Operations revenue increased by $50.1 million, or 128%, mainly from a 212% rise in volume, offset by a 17% decrease in average selling prices and a 10% unfavorable foreign currency impact[177]. Profitability - Gross profit for Q1 2025 was $76.43 million, reflecting a 39% increase from $55.09 million in Q1 2024[173]. - Consolidated gross profit increased by $21.3 million, or 39%, but gross margin decreased to 25.3% from 35.9% year-over-year[179]. - Net income surged to $16.75 million in Q1 2025, a 673% increase from $2.17 million in Q1 2024[173]. - Income from operations rose significantly by 224% to $27.28 million in Q1 2025, compared to $8.41 million in Q1 2024[173]. Costs and Expenses - Cost of revenue increased by 130% to $225.94 million in Q1 2025, compared to $98.31 million in Q1 2024[173]. - Operating expenses totaled $49.14 million in Q1 2025, a 5% increase from $46.68 million in Q1 2024[173]. - Consolidated general and administrative expenses rose by $6.2 million, or 16%, due to higher personnel expenses and credit risk allowances[182]. - Consolidated income tax expense increased by $5.2 million, or 401%, with an effective tax rate of 28.1% for the three months ended March 31, 2025[188][189]. Research and Development - Research and development costs for the three months ended March 31, 2025, were $2.4 million, compared to $1.9 million for the same period in 2024, with total engineering expenses at $4.4 million in 2025[138]. - Total engineering expenses were $4.4 million for Q1 2025, with R&D costs representing a significant portion of this expenditure[138]. Market and Economic Factors - The Inflation Reduction Act (IRA) raised the Investment Tax Credit (ITC) to 30% with no step downs before 2032, which is expected to influence customer orders positively[142]. - The ongoing Russian-Ukraine war has increased logistics costs for material procurement, impacting the company's supply chain[147]. - The company is focused on reducing costs and aligning its operations in Brazil with current market conditions due to economic pressures affecting power purchase agreements[140]. Product Development and Innovation - The company’s flagship tracker design allows one motor to drive multiple rows of solar panels, resulting in greater reliability and lower installation costs compared to competitors' designs[134]. - The company has added a dual-row tracker design to its product portfolio through the acquisition of STI, enhancing its offerings for irregular project areas[135]. - The company’s core U.S. patent on a linked-row, single-driving apparatus for solar trackers does not expire until February 5, 2030, providing a competitive advantage[134]. Financial Position - As of March 31, 2025, the cash balance was $348.3 million, with $567.8 million in net working capital and $232.8 million in outstanding borrowings[191]. - Cash used in operating activities was $13.1 million for the three months ended March 31, 2025, compared to cash provided of $47.5 million in the same period of 2024[190][196]. - The Company refinanced its Revolving Credit Facility, reducing the Consolidated First Lien Secured Leverage Ratio from 7.10:1.00 to 5.50:1.00[192]. - Surety bonds posted as of March 31, 2025, totaled approximately $269.9 million, which do not adversely impact liquidity or capital resources[205]. Supplier and Cost Management - The company has successfully negotiated agreements with key suppliers to share the economic benefits of the section 45X manufacturing tax credit, which applies to certain components[143]. - The company continues to expand its supplier base and productivity initiatives to mitigate inflationary pressures on operations[149]. - The average selling price (ASP) and cost per watt (CPW) metrics are utilized to evaluate pricing trends and customer profitability[158].

Company Overview - Array Technologies, Inc. (NASDAQ: ARRY) specializes in manufacturing and selling solar tracking technology across various markets including the United States, Spain, Brazil, and Australia [1] Market Focus - The company primarily serves customers involved in the development of solar energy sites, indicating a strong alignment with the growing renewable energy sector [1] Investment Philosophy - The investment approach emphasizes identifying mispriced securities by analyzing the underlying drivers of a company's financials, often utilizing a Discounted Cash Flow (DCF) model for valuation [1]

Core Viewpoint - Array Technologies, Inc. reported quarterly earnings of $0.13 per share, exceeding the Zacks Consensus Estimate of $0.09 per share, and showing an increase from $0.06 per share a year ago, indicating a 44.44% earnings surprise [1] Financial Performance - The company posted revenues of $302.36 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 14.92%, compared to $153.4 million in the same quarter last year [2] - Over the last four quarters, Array Technologies has exceeded consensus EPS estimates three times and topped consensus revenue estimates four times [2] Stock Performance - Array Technologies shares have declined approximately 18.4% since the beginning of the year, while the S&P 500 has decreased by 3.9% [3] - The current consensus EPS estimate for the upcoming quarter is $0.18 on revenues of $285.86 million, and for the current fiscal year, it is $0.61 on revenues of $1.09 billion [7] Industry Outlook - The solar industry, to which Array Technologies belongs, is currently ranked in the bottom 18% of over 250 Zacks industries, indicating potential challenges ahead [8] - The performance of Array Technologies may be influenced by the overall outlook of the solar industry, as research shows that the top 50% of Zacks-ranked industries outperform the bottom 50% by more than 2 to 1 [8]

Financial Data and Key Metrics Changes - The company reported revenue of $302.4 million for Q1 2025, a 97% increase year-over-year and a 10% increase sequentially from Q4 2024 [29][30] - Adjusted gross margin for Q1 2025 was 26.5%, reflecting a decline due to the roll-off of prior year benefits and commodity-driven compression [32][34] - Net income attributable to common stockholders was $2.3 million, compared to a net loss of $11.3 million in the prior year [34] Business Line Data and Key Metrics Changes - The delivered volume increased by 143% year-over-year, achieving the second-largest quarter of volume shipped since Q2 2023 [31] - Domestic order book grew over 9% in Q1 2025, with over 40% of the order book set to be delivered in the remaining quarters of 2025 [9][10] Market Data and Key Metrics Changes - Sales in North America represented approximately 65% of total revenue, with a mix shift impacting gross margins [31] - The order book remained resilient at $2 billion despite near-term policy-related headwinds [8][40] Company Strategy and Development Direction - The company is focused on maintaining operational agility and delivering long-term value amidst a rapidly evolving policy environment [7] - Continued emphasis on solar energy as a major component of energy strategy, with expectations for growth to meet increasing electricity demand [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of fundamentals and resilience of the company despite near-term volatility [7] - The company reaffirmed its full-year 2025 guidance, expecting revenue between $1.05 billion and $1.15 billion [39][40] Other Important Information - The company has a strong cash position with $348 million in cash and total liquidity of approximately $510 million [35][37] - The company is actively engaging with policymakers regarding energy tax credits and tariffs [15][17] Q&A Session Summary Question: Can you provide more color on the growing interest in VCAs? - Management is in active discussions with customers about longer-term commitments and will announce VCAs as they are finalized [48] Question: What is the guidance for Q2 revenue? - Specific guidance for Q2 was not provided, but the first half is expected to account for about 55% of total revenue [51] Question: Can you discuss the size of orders and lead times? - Lead times remain industry-leading at 14 weeks, with ongoing discussions about potential early pull-ins for 2025 [55] Question: How is the company managing cash use and term loans? - The company is looking at all options for managing term loans and is pleased with its balance sheet and liquidity position [66] Question: What is the impact of steel pricing on the business? - Steel prices are expected to increase by 25% to 28% for the year, which will translate into higher ASPs for future bookings [92] Question: What is the outlook for bookings momentum? - While demand momentum remains strong, uncertainty around tariffs and IRA impacts may affect the ability to convert bookings into orders [99]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $302.4 million, a 97% increase year-over-year and a 10% increase sequentially from Q4 2024 [26][7] - Adjusted gross margin for Q1 2025 was 26.5%, reflecting a decline due to the roll-off of prior year benefits and a higher mix of international projects [29][30] - Net income attributable to common stockholders was $2.3 million, compared to a net loss of $11.3 million in the prior year [31] - Adjusted EBITDA was $40.6 million, representing an adjusted EBITDA margin of 13.4% [30] Business Line Data and Key Metrics Changes - Delivered volume increased by 143% year-over-year, achieving the second-largest quarter of volume shipped since Q2 2023 [27][7] - Domestic order book grew over 9% in Q1 2025, with over 40% of the order book set to be delivered in the remaining quarters of 2025 [8][9] - New product offerings, such as Omnitrac and Skylink, accounted for 15% of revenue and 30% of new bookings in Q1 [9] Market Data and Key Metrics Changes - The order book remained resilient at $2 billion despite near-term policy-related headwinds [7][36] - North America represented approximately 65% of revenue, with a mix shift impacting gross margins [28] - International markets, particularly Europe, are performing as expected with solid growth anticipated in 2025 [14] Company Strategy and Development Direction - The company is focused on maintaining operational agility and delivering long-term value amidst a rapidly evolving policy environment [6] - Continued investment in talent and technology is aimed at enhancing customer engagement and product innovation [8][20] - The company is actively engaging with policymakers to support energy tax credits and address regulatory uncertainties [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of fundamentals and the resilience of the company despite near-term volatility [6] - The company reaffirmed its full-year 2025 guidance, expecting revenue between $1.05 billion and $1.15 billion [36] - Management noted that while utility-scale solar remains a low-cost energy source, regulatory uncertainties may lead to project delays [11] Other Important Information - The company ended the quarter with a cash balance of approximately $348 million and total liquidity of about $510 million [32][34] - Free cash flow for the period was a use of $15.4 million, driven by working capital investments [30] - The company is exploring additional markets for international expansion, including the Middle East [15] Q&A Session Summary Question: Can you provide more color on the growing interest in VCAs? - Management is in active discussions with customers about longer-term commitments and will announce VCAs as they are finalized [42][44] Question: What is the guidance for Q2 revenue? - Specific guidance for Q2 has not been provided, but the first half is expected to account for about 55% of total revenue [46][47] Question: Can you discuss the size of orders and lead times? - Lead times remain industry-leading at fourteen weeks, with ongoing discussions about potential early pull-ins for 2025 [50][51] Question: How is the company managing cash use and term loans? - The company has successfully amended its revolving credit facility and is considering options for managing term loans [61][62] Question: What is the exposure to battery cell pack challenges? - Most components needed for projects are already in the country, minimizing risk for 2025 projects [76] Question: How are steel pricing and bookings expected to impact margins? - Steel prices are expected to increase, which will translate into higher ASPs for future bookings [85][86]

1Q 2 5 E A R N I N G S P RE S E N TA T IO DISCLAIMER 1Q25 EARNINGS PRESENTATION Forward Looking Statements May 6, 2025 Thi s presentation contains forward-looking statements that are based on our management's beli efs and assumptions and on informati on currently available to our management. Forward-looking statements inclu de informati on concerning our possible or assumed future results of operations, business strategies, financing and investment plans, competitive position, indu stry and regulatory envir ...