Core Viewpoint - FTC Solar, Inc. is set to report its fourth quarter and full year 2024 financial results on March 31, 2025, before market open [1] Group 1: Financial Reporting - The company will hold a conference call at 8:30 a.m. E.T. on the same day to discuss its financial results, outlook, and other business matters [2] - The conference call will be accessible via webcast and will have a replay available for 30 days [2] Group 2: Company Overview - FTC Solar, founded in 2017, specializes in solar tracker systems, technology, software, and engineering services [3] - The company's solar trackers enhance energy production by optimizing solar panel orientation, offering a competitive installation cost-per-watt advantage [3]

Core Viewpoint - FTC Solar, Inc. is set to report its fourth quarter and full year 2024 financial results on March 31, 2025, before market open, indicating a significant upcoming event for investors [1]. Financial Results Announcement - The company will hold a conference call at 8:30 a.m. E.T. on the same day to discuss its financial results, outlook, and other business matters, which will be accessible via webcast [2]. Company Overview - FTC Solar, founded in 2017, specializes in solar tracker systems, technology, software, and engineering services, enhancing energy production by optimizing solar panel orientation [3]. - The company's innovative tracker designs offer strong performance and reliability, boasting an industry-leading installation cost-per-watt advantage [3].

Company Overview - FTC Solar, Inc. is a leading provider of solar tracker systems, software, and engineering services, founded in 2017 by renewable energy industry veterans [3] - The company specializes in solar trackers that enhance energy production by optimizing solar panel orientation, offering a competitive installation cost-per-watt advantage [3] Leadership Appointment - Kent James has been appointed as Chief Commercial Officer for North America, effective January 6, 2025, to lead FTC's North American commercial strategy [1] - Kent James brings over 20 years of experience in the solar industry, having previously served in various roles including SVP of Sales and Development at Primoris Renewable Energy, where he contributed to the company's growth to a top 5 industry leader with revenues exceeding $1 billion [2][3] - His strategic and relationship-driven approach is expected to strengthen FTC's market position and drive significant revenue growth [2] Market Position and Growth Potential - FTC Solar is recognized for its exceptional product portfolio, which is well-regarded in the industry and has a strong growth potential [2] - The company has a robust pipeline of projects and aims to expand its relationships within the solar market [2]

Supply Chain and Supplier Diversification - FTC Solar reported a significant reduction in reliance on Chinese suppliers, decreasing from 90% in 2019 to less than 20% as of the date of the report[131]. - As of September 30, 2024, the company has qualified suppliers outside of China for certain commodities to mitigate tariff impacts[131]. - The company has invested in Alpha Steel to enhance its U.S.-based supply chain and reduce reliance on international suppliers[131]. - The company is focused on diversifying its manufacturing partnerships and optimizing transportation costs to address supply chain disruptions[134]. Product and Technology Development - The company introduced the SUNOPS cloud-based solar asset monitoring solution in August 2023 and plans to launch the Automated Hail Stow Solution in May 2024[137]. - The introduction of new products and technology is part of the company's strategy to attract and retain customers and enhance user experience[137]. Financial Performance - Total revenue for the three months ended September 30, 2024, was $10,136,000, a decrease of 66.8% compared to $30,548,000 for the same period in 2023[151]. - Product revenue decreased by 72.8% to $7,411,000, down from $27,274,000, primarily due to an 82% decrease in MW produced[153][154]. - Service revenue decreased by 16.8% to $2,725,000, down from $3,274,000, attributed to a 29% decrease in ASP and lower engineering consulting revenues[153][155]. - Total revenue for the nine months ended September 30, 2024, was $34,153,000, a decrease of 67.1% compared to $103,801,000 for the same period in 2023[168]. - Product revenue decreased by 66.5% to $27,092,000 in 2024 from $80,927,000 in 2023, primarily due to a 73% decrease in the amount of MW produced[169][170]. - Service revenue fell by 69.1% to $7,061,000 in 2024 from $22,874,000 in 2023, attributed to a 63% decrease in MW delivered and a 16% decrease in ASP[171]. - Total cost of revenue increased to $42,910,000 in 2024, a 55.4% decrease from $96,186,000 in 2023, leading to a gross loss of $8,757,000[172]. - Gross margin percentage for the nine months ended September 30, 2024, was negative 25.6%, compared to a positive 7.3% in 2023[173]. Expenses and Losses - Gross profit for the three months ended September 30, 2024, was a loss of $4,306,000, compared to a profit of $3,379,000 in 2023, resulting in a gross margin of -42.5%[151][158]. - Research and development expenses were $1,467,000, a decrease of 23.6% from $1,921,000, with R&D expenses as a percentage of revenue increasing to 14.5%[161]. - Selling and marketing expenses decreased by 62.0% to $2,406,000 from $6,324,000, with selling and marketing costs as a percentage of revenue at 23.7%[163]. - General and administrative expenses were $6,797,000, down 40.4% from $11,411,000, with G&A expenses as a percentage of revenue at 67.1%[165]. - The net loss for the three months ended September 30, 2024, was $15,359,000, compared to a net loss of $16,937,000 in 2023[151]. - The company reported a net loss of $36.371 million for the nine months ended September 30, 2024, compared to a net loss of $39.113 million for the same period in 2023, representing a 7% improvement[227]. - Adjusted EBITDA for the nine months ended September 30, 2024, was $(33.280) million, compared to $(24.097) million for the same period in 2023, indicating a decline in performance[227]. Cash Flow and Liquidity - The company incurred net cash used in operations of $18.0 million for the nine months ended September 30, 2024, compared to $46.4 million for the same period in 2023[191]. - Working capital decreased by approximately $35.0 million from $53.8 million at December 31, 2023 to $18.9 million at September 30, 2024[194]. - The company plans to issue $15 million in long-term senior secured promissory notes to address liquidity needs[185]. - The company had $8.3 million in cash and cash equivalents as of September 30, 2024, with no debt outstanding[231]. - Cash equivalents included $1.8 million in money market fund deposits as of September 30, 2024, down from $13.9 million at December 31, 2023[232]. Market Risks and Customer Concentration - The company is exposed to market risks due to customer concentrations and fluctuations in steel and aluminum prices, which could impact financial performance[229]. - The company relies on a small number of customers that account for a significant portion of revenue, increasing credit risk exposure[235]. - The company regularly evaluates reserves for potential credit losses based on expected lifetime credit losses[235]. Stock and Equity - The company’s common stock was transferred to the Nasdaq Capital Market due to non-compliance with the minimum bid price requirement[184]. - The company has not issued any dividends in its history and does not expect to issue dividends over the life of option grants[212]. - The company utilized Monte Carlo simulations for certain awards granted with market conditions, estimating the average present value based on up to 250,000 simulation paths[213]. Other Financial Metrics - The diluted adjusted net loss per share for the nine months ended September 30, 2024, was $(0.27), compared to $(0.22) for the same period in 2023[227]. - Stock-based compensation for the three months ended September 30, 2024, was $1,319 thousand, up from $1,192 thousand in the same period of 2023[224]. - The company did not identify any impairments of long-lived assets, intangible assets, or goodwill during the nine months ended September 30, 2024, and 2023[218]. - The weighted-average common shares outstanding for diluted shares was 127,380,292 for the three months ended September 30, 2024, compared to 119,793,821 for the same period in 2023[225].

Financial Data and Key Metrics Changes - Revenue for Q3 2024 was $10.1 million, a decrease of 11.3% compared to the prior quarter and a decrease of 66.8% year-over-year due to lower product volumes [34] - GAAP gross loss was $4.3 million, or 42.5% of revenue, compared to a gross loss of $2.3 million, or 20.5% of revenue in the prior quarter [35] - GAAP net loss was $15.4 million, or $0.12 per diluted share, compared to a loss of $12.2 million, or $0.10 per diluted share in the prior quarter [37] - Adjusted EBITDA loss was $12.2 million, which was better than the midpoint of guidance, compared to losses of $10.5 million in the prior quarter [38] - The company ended the quarter with $8.3 million in cash on the balance sheet [39] Business Line Data and Key Metrics Changes - Over 70% of current purchase orders are in the 1P category, indicating a significant shift from previous quarters where 1P revenues were only 16% and 30% in Q2 and Q3 respectively [13] - The company has transitioned from a 2P only company to one that offers both 1P and 2P solutions, significantly increasing the total addressable market [15] Market Data and Key Metrics Changes - The company is seeing strong growth in the Northeast and Southwest U.S. markets, with opportunities expanding in the Southeast due to high wind product offerings [46] - The company has signed a multi-year supply agreement with Strata Clean Energy for at least 500 megawatts of 2P trackers, which could expand to over 1 gigawatt [28] Company Strategy and Development Direction - The company is focused on expanding its 1P product offerings, which now include high wind solutions and compatibility for various module types, to capture a larger market share [14] - The management believes that the company is poised to achieve quarterly profitability in 2025, driven by strong margins and a robust product cost structure [25] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the solar market's resilience, noting that solar has experienced growth regardless of political changes [48] - The company expects to see continued improvement in revenue, margin, and adjusted EBITDA in Q4, with a target of achieving adjusted EBITDA breakeven on a quarterly basis in 2025 [41] Other Important Information - The company entered into a binding term sheet for a $15 million promissory note, which is expected to close by the end of November [21] - The company received an additional $4.7 million in cash from an earn-out on a prior investment, improving its liquidity position [39] Q&A Session Summary Question: What proportion of the backlog is coming from 1P revenues? - Management indicated that about 70% of signed purchase orders are in the 1P category, with expectations for revenue growth from this segment [43] Question: How is the geographic distribution of projects? - The company has a diverse geographic focus, with strong growth in the Northeast, Southwest, and Southeast markets [46] Question: What is the breakeven revenue range? - Management confirmed that the breakeven revenue range remains at $50 million to $60 million, consistent with previous discussions [51] Question: What is the outlook for 2025 revenue guidance? - Management expects about 60% of the signed backlog to start recognizing revenue in 2025, indicating strong growth potential [53] Question: Will there be opportunities for 1P in the Strata supply agreement? - Currently, the agreement is for 2P delivery, but there are expectations for future opportunities to cross-sell between 1P and 2P products [54]

Financial Data and Key Metrics Changes - Revenue for Q3 2024 was $10.1 million, a decrease of 11.3% compared to the prior quarter and a decrease of 66.8% year-over-year due to lower product volumes [35] - GAAP gross loss was $4.3 million, or 42.5% of revenue, compared to a gross loss of $2.3 million, or 20.5% of revenue in the prior quarter [36] - GAAP net loss was $15.4 million, or $0.12 per diluted share, compared to a loss of $12.2 million, or $0.10 per diluted share in the prior quarter [38] - Adjusted EBITDA loss was $12.2 million, which was better than the midpoint of guidance, compared to losses of $10.5 million in the prior quarter [39] - The company ended the quarter with $8.3 million in cash on the balance sheet [40] Business Line Data and Key Metrics Changes - Over 70% of current purchase orders are in the 1P category, indicating a significant shift towards this product line [13] - The company has transitioned from a 2P-only company to one that offers both 1P and 2P solutions, significantly increasing the total addressable market [15] Market Data and Key Metrics Changes - The company is seeing strong growth in the Northeast and Southwest regions of the U.S., with opportunities in the Southeast due to high wind products [49] - The company has a diverse geographical presence, focusing on both domestic and international markets [49] Company Strategy and Development Direction - The company aims to achieve quarterly profitability in 2025, supported by a strong product cost structure and efficient operating expenses [26][28] - A binding agreement has been entered to add additional liquidity to the balance sheet, which is expected to enhance commercial opportunities [12] - The company has signed significant supply agreements, including a multi-year agreement with Strata Clean Energy for at least 500 megawatts of 2P trackers and a 1 gigawatt supply agreement with Dunlieh Energy [29][30] Management's Comments on Operating Environment and Future Outlook - Management believes the company is at an inflection point with significant traction in the 1P market, which is expected to drive future revenue growth [13][20] - The political environment is seen as favorable for solar growth, with historical data showing resilience in the solar market regardless of political changes [50][51] - The company expects to see strong growth potential in 2025, driven by a robust backlog and new commercial opportunities [61] Other Important Information - The company has received an additional $4.7 million in cash from an earn-out on a prior investment, enhancing its liquidity position [40][32] - The company has a breakeven revenue range of $50 million to $60 million, which remains unchanged despite the shift towards 1P products [59] Q&A Session Summary Question: What proportion of the backlog is coming from 1P revenues? - About 70% of signed purchase orders are in the 1P category, indicating a growing revenue stream from this segment [45] Question: Can you describe the geographic distribution of new projects? - The company has a strong focus on the U.S., with growth in the Northeast, Southwest, and Southeast regions [49] Question: What is the outlook for the political environment affecting solar? - The solar market is expected to thrive politically, with historical growth trends indicating resilience regardless of political control [50] Question: Is the breakeven revenue range still $50 million to $60 million? - Yes, the breakeven point remains at $50 million to $60 million, with similar margins on both 1P and 2P products [59] Question: What are the opportunities for cross-selling between 1P and 2P? - There are opportunities to cross-sell between 1P and 2P, especially as larger EPCs plan projects over multiple quarters [62]

Company Positioning and Strategy - FTC Solar is at an inflection point due to its positioning and traction in 1P, with over 70% of bookings now in 1P compared to 16% of revenues in Q2 and 30% in Q3[4] - The company's transition from 2P-only to a broad offering across 1P and 2P opens up approximately 85% of the market, positioning FTC for potential share gains[4] - FTC Solar aims to achieve quarterly profitability in 2025, driven by a product cost structure that enables strong margin growth as the top line scales and an efficient operating cost structure[5] Recent Wins and Agreements - Strata Clean Energy has a multi-year agreement for 500MW of 2P trackers, expandable to over 1GW[6] - Dunlieh Energy, a new customer, has a 1GW agreement, with the first project being 500MW in Nebraska[6] - Sandhills Energy Agreement includes three projects totaling 225MW, 320MW, and 448MW[6] Q3 Financial Performance - Q3 revenue was $30548 thousand, compared to $10136 thousand in Q3 2023[7] - Gross margin percentage was (42.5%) compared to 11.1% in Q3 2023[7] - Net loss was $(15359) thousand, compared to $(16937) thousand in Q3 2023[7] Q4 Outlook - Q4 2024 revenue is projected to be between $10 million and $14 million[9] - Non-GAAP gross margin for Q4 2024 is expected to be between (42.2%) and (10.7%)[9] - Adjusted EBITDA for Q4 2024 is forecasted to be between $(13.7) million and $(9.9) million[9]

Core Viewpoint - FTC Solar reported a quarterly loss of $0.10 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.08, marking a 25% earnings surprise [1] - The company generated revenues of $10.14 million for the quarter ended September 2024, exceeding the Zacks Consensus Estimate by 2.66%, but down from $30.55 million year-over-year [2] Company Performance - Over the last four quarters, FTC Solar has consistently failed to meet consensus EPS estimates [2] - The stock has declined approximately 24.8% year-to-date, contrasting with the S&P 500's gain of 25.8% [3] Future Outlook - The company's earnings outlook is critical for investors, with current consensus EPS estimates at -$0.06 for the upcoming quarter and -$0.33 for the current fiscal year [7] - The estimate revisions trend for FTC Solar is currently unfavorable, resulting in a Zacks Rank 4 (Sell), indicating expected underperformance in the near future [6] Industry Context - The solar industry is currently ranked in the bottom 26% of over 250 Zacks industries, suggesting a challenging environment for stocks in this sector [8] - Canadian Solar, a peer in the industry, is expected to report a quarterly loss of $0.44 per share, reflecting a significant year-over-year decline of 237.5% [9]

Financial Performance - Third quarter revenue was $10.1 million, a decrease of 66.8% compared to the same quarter last year[4] - Gross margin percentage was -42.5%, compared to -20.5% in the prior quarter[5] - Total operating expenses were $10.7 million, down from $19.7 million in the prior year[6] - Net loss for the quarter was $15.4 million, or $0.12 per diluted share, compared to a net loss of $16.9 million, or $0.14 per diluted share in the same quarter last year[7] - Total revenue for the three months ended September 30, 2023, was $30,548,000, a decrease from $34,153,000 for the nine months ended September 30, 2024[16] - Gross profit for the three months ended September 30, 2023, was $3,379,000, compared to a gross loss of $8,757,000 for the nine months ended September 30, 2024[16] - Net loss for the three months ended September 30, 2023, was $16,937,000, which is an improvement from a net loss of $39,113,000 for the nine months ended September 30, 2024[16] - U.S. GAAP revenue for the nine months ended September 30, 2024, was $34,153,000, a decrease from $103,801,000 in the same period of 2023[22] - Non-GAAP gross profit for the nine months ended September 30, 2024, was $(7,524,000), compared to $9,519,000 in the same period of 2023, reflecting a significant decline[22] - Non-GAAP gross margin percentage for the nine months ended September 30, 2024, was (22.0%), down from 9.2% in the same period of 2023[22] - U.S. GAAP operating expenses for the nine months ended September 30, 2024, were $30,645,000, a decrease from $46,656,000 in the same period of 2023[23] - Adjusted EBITDA for the nine months ended September 30, 2024, was $(33,280,000), compared to $(24,097,000) in the same period of 2023[26] - The net loss per U.S. GAAP for the nine months ended September 30, 2024, was $(36,371,000), compared to $(39,113,000) in the same period of 2023[26] - Stock-based compensation for the nine months ended September 30, 2024, was $4,243,000, down from $9,044,000 in the same period of 2023[26] Cash and Assets - Cash and cash equivalents decreased to $8,255,000 as of September 30, 2024, down from $25,235,000 as of December 31, 2023[17] - Accounts receivable decreased to $37,345,000 as of September 30, 2024, compared to $65,279,000 as of December 31, 2023[17] - Total assets decreased to $91,693,000 as of September 30, 2024, from $123,070,000 as of December 31, 2023[17] - Total liabilities increased slightly to $61,285,000 as of September 30, 2024, compared to $60,599,000 as of December 31, 2023[17] - The company reported a net cash used in operations of $18,008,000 for the nine months ended September 30, 2024, compared to $46,383,000 for the same period in the previous year[18] - The company’s accumulated deficit increased to $335,506,000 as of September 30, 2024, from $299,135,000 as of December 31, 2023[17] Future Outlook - The company added $18 million in new purchase orders since August 8, 2024, bringing the contracted backlog to $513 million[2] - A binding term sheet was entered into for a $15 million promissory note to strengthen the balance sheet[9] - For Q4 2024, revenue is expected to be flat to up 39% relative to Q3 2024, with guidance of $9.0 million to $11.0 million[11] - The company anticipates achieving adjusted EBITDA breakeven on a quarterly basis in 2025[11] Agreements and Investments - A $4.7 million earn-out was received post quarter-end related to a prior investment in Dimension Energy[8] - The company has a new 1GW tracker supply agreement with Dunlieh Energy and a multi-year agreement with Strata Clean Energy for 500MW, expandable to 1GW+[1] Other Expenses - The company incurred one-time recruitment fees related to hiring a new CEO in August 2024, which will be expensed over the next two years[27] - Non-routine legal fees incurred in 2023 amounted to $181,000, reflecting specific legal matters not routine to the business operations[27] - The weighted-average common shares outstanding for the nine months ended September 30, 2024, were 126,234,997, compared to 112,794,562 in the same period of 2023[27]

Group 1 - Momentum investing contrasts with the traditional "buy low and sell high" strategy, focusing instead on "buying high and selling higher" to capitalize on fast-moving stocks [1] - Identifying the right entry point for momentum stocks can be challenging, as they may lose momentum if their valuations exceed future growth potential [1] - A safer investment strategy involves targeting bargain stocks that exhibit recent price momentum, utilizing tools like the Zacks Momentum Style Score [2] Group 2 - FTC Solar (FTCI) has shown significant price movement, with a 127.7% increase over the past four weeks, indicating strong investor interest [3] - The stock has also gained 14.2% over the past 12 weeks, demonstrating its ability to maintain momentum over a longer period [4] - FTCI has a high Momentum Score of A, suggesting it is an opportune time to invest in the stock for potential gains [5] Group 3 - The upward trend in earnings estimate revisions has contributed to FTCI's Zacks Rank 2 (Buy), indicating strong momentum among stocks with similar rankings [6] - FTCI is currently trading at a Price-to-Sales ratio of 0.79, suggesting it is undervalued, as investors pay only 79 cents for each dollar of sales [6] - The stock appears to have significant growth potential while maintaining a reasonable valuation [7]