Exhibit 99.1 Investor Contact: Robert Lahey robert.lahey@maxeon.com +1 (202) 246-1872 Media Contact: Anna Porta anna.porta@maxeon.com +39 345 7706205 Maxeon Solar Technologies Announces Fourth Quarter and Fiscal Year 2022 Financial Results --Record Gross Profit of $20 million in fourth quarter of 2022-- --Guiding Positive Adj. EBITDA in first quarter of 2023-- Singapore, March 8, 2023 – Maxeon Solar Technologies, Ltd. (NASDAQ:MAXN) ("Maxeon" or "the Company"), a global leader in solar innovation and channel ...

Financial Data and Key Metrics Changes - Total shipments for Q3 2022 were 605 megawatts, representing a 16% sequential increase [28] - Revenue for Q3 2022 was $275 million, also a 16% sequential increase [29] - Non-GAAP gross income in Q3 was negative $16 million, an improvement of $8 million from Q2 [30] - Cash and short-term investments at the end of Q3 were $314 million, up from $180 million at the end of Q2 [35] - GAAP net loss for Q3 was $45 million, compared to $88 million in the previous quarter [35] Business Line Data and Key Metrics Changes - Distributed Generation (DG) sales in Q3 were up 25% year-over-year, benefiting from price increases and a higher mix of Maxeon six products [14] - ASPs (Average Selling Prices) increased in core EU markets, with modules integrated with power electronics accounting for over 60% of sales in Q3 [12] - Beyond the panel revenue grew sequentially in multiple markets including Belgium, Germany, Italy, the UK, and Australia [12] Market Data and Key Metrics Changes - In France, residential market share increased to over 20% in Q3, up from mid-teens in 2021 [15] - The company expects significant market share expansion in the US due to increasing demand for premium solar products and a decreasing number of alternative suppliers [11] - The US utility scale demand is projected to double over the next few years, driven by the extension of investment tax credits [21] Company Strategy and Development Direction - The company plans to focus on panel manufacturing capacity growth, US market expansion, and contributions from beyond the panel initiatives [7] - A new three-gigawatt solar cell and module factory is planned in the Southeastern United States, with an anticipated ramp-up in 2025 [23] - The company is evaluating strategies to expand Maxeon seven capacity to meet high demand in the US and EU residential markets [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving positive gross margins in Q4 2022 and expects to reach at least 15% gross margins by the end of 2023 [39] - The company anticipates a sequential improvement in performance driven by contracted utility scale prices and strong DG pricing in the US and EU [40] - Management noted that underutilization charges are decreasing as production ramps up, indicating strong demand [58] Other Important Information - The company is working closely with the Department of Energy to secure financing for the new factory, with a total projected investment of over $1 billion [25] - The company is also focused on optimizing ASPs and leveraging supply chain efficiencies to improve margins [16] Q&A Session Summary Question: Can you talk about the ramp through 2022 and the ability to fill volume? - Management noted strong demand in the US utility space and that underutilization is operational, not due to lack of demand [52][57] Question: How should we think about the cadence of margins? - Management expects a ramp in contributions from beyond the panel products and improved ASPs in the second half of the year [61] Question: Can you provide an update on the IBC market and technology? - Management expressed confidence in their patent protection and ongoing innovation in IBC technology [70][72] Question: Any updates on forced labor prevention issues? - Management stated that customers feel comfortable with the current supply chain and that there are no anticipated issues with IBC products being shipped to the US [81] Question: Can you provide details on the billion dollars of CapEx? - Management clarified that the billion-dollar figure includes total project investment, not just CapEx, and specific timing for spending has not been disclosed [85][94] Question: What is the status of the CEO search process? - Management indicated that the search for a new CEO is ongoing, with no specific timeline disclosed [104]

3Q 2022 RESULTS SUPPLEMENTAL SLIDES NOVEMBER 10, 2022 1 | © 2021 Maxeon Solar Technologies moxeon SAFE HARBOR STATEMENT This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, but not limited to, statements regarding: (a) our expectations regarding pricing trends, demand and growth projections; (b) potential disruptions to our operations and supply chain t ...

[Condensed Consolidated Balance Sheets](index=2&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased, but a significant rise in total liabilities, driven by convertible debt and contract liabilities, led to a substantial decrease in equity Key Balance Sheet Metrics | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :-------------------------------- | :------------------------------- | :------------------------------- | | Total Assets | $1,256,513 | $1,056,543 | | Total Liabilities | $1,126,035 | $701,668 | | Equity attributable to the Company | $124,840 | $349,456 | Key Balance Sheet Changes (Jan 2, 2022 to Oct 2, 2022) | Key Balance Sheet Changes (Jan 2, 2022 to Oct 2, 2022) | | :----------------------------------------------------- | | Cash and cash equivalents: Increased from $166,542k to $199,085k | | Inventories: Increased from $212,820k to $300,850k | | Contract liabilities, current portion: Increased from $44,059k to $132,745k | | Convertible debt: Increased from $145,772k to $376,927k | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Despite increased revenue, the company reported a higher net loss due to elevated cost of revenue and increased operating expenses Key Operating Metrics | Metric | Three Months Ended Oct 2, 2022 (in thousands) | Three Months Ended Oct 3, 2021 (in thousands) | Nine Months Ended Oct 2, 2022 (in thousands) | Nine Months Ended Oct 3, 2021 (in thousands) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :----------------------------------------- | :----------------------------------------- | | Revenue | $275,449 | $220,488 | $736,610 | $561,800 | | Cost of revenue | $291,196 | $237,196 | $804,645 | $580,269 | | Gross loss | $(15,747) | $(16,708) | $(68,035) | $(18,469) | | Operating loss | $(56,943) | $(49,347) | $(182,342) | $(126,384) | | Net loss | $(44,478) | $(66,013) | $(191,440) | $(182,152) | | Basic Net loss per share | $(1.09) | $(1.62) | $(4.70) | $(4.97) | [Condensed Consolidated Statements of Comprehensive Loss](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Loss) Total comprehensive loss was slightly higher than net loss, primarily due to currency translation adjustments and net changes in derivatives Comprehensive Loss Metrics | Metric | Nine Months Ended Oct 2, 2022 (in thousands) | Nine Months Ended Oct 3, 2021 (in thousands) | | :-------------------------- | :----------------------------------------- | :----------------------------------------- | | Net loss | $(191,440) | $(182,152) | | Total comprehensive loss | $(191,592) | $(182,519) | Components of Other Comprehensive (Loss) Income (Nine Months Ended Oct 2, 2022) | Components of Other Comprehensive (Loss) Income (Nine Months Ended Oct 2, 2022) | | :------------------------------------------------------------------------------ | | Currency translation adjustment: $(7,774) thousand | | Net change in derivatives: $7,621 thousand | [Condensed Consolidated Statements of Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Equity) Total equity significantly decreased, driven by accumulated deficit from net losses and the reclassification of convertible debt from equity to liability Key Equity Metrics | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :------------------------------- | :------------------------------- | :------------------------------- | | Total Equity | $130,478 | $354,875 |\ | Accumulated Deficit | $(444,562) | $(262,961) | Impact of ASU 2020-06 Adoption (as of January 2, 2022) | Impact of ASU 2020-06 Adoption (as of January 2, 2022) | | :----------------------------------------------------- | | Reduction in Additional Paid-In Capital: $(52,189) thousand | | Increase in Accumulated Deficit: $10,122 thousand | | Net impact on Equity: $(42,067) thousand | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating and investing activities increased, but significant financing from new convertible debt led to a net increase in cash Key Cash Flow Metrics | Metric | Nine Months Ended Oct 2, 2022 (in thousands) | Nine Months Ended Oct 3, 2021 (in thousands) | | :------------------------------------------------- | :----------------------------------------- | :----------------------------------------- | | Net cash used in operating activities | $(36,292) | $(28,474) | | Net cash used in investing activities | $(132,031) | $(115,766) | | Net cash provided by financing activities | $213,305 | $137,527 | | Net increase (decrease) in cash, cash equivalents and restricted cash | $45,330 | $(6,646) | Key Financing Activities (Nine Months Ended Oct 2, 2022) | Key Financing Activities (Nine Months Ended Oct 2, 2022) | | :----------------------------------------------------- | | Net proceeds from issuance of convertible debt: $188,812 thousand | | Proceeds from debt: $196,388 thousand | | Repayment of debt: $(171,141) thousand | [NOTE 1. BACKGROUND AND BASIS OF PRESENTATION](index=12&type=section&id=NOTE%201.%20BACKGROUND%20AND%20BASIS%20OF%20PRESENTATION) Maxeon Solar Technologies, Ltd. is a Singapore-incorporated public company manufacturing solar cells and panels globally, with improved liquidity from new convertible debt and seasonal revenue fluctuations [Background](index=12&type=section&id=Background) Maxeon Solar Technologies, Ltd. is an independent, public Singaporean company manufacturing solar cells and panels globally, with significant ownership by TotalEnergies and TZE SG - Maxeon Solar Technologies, Ltd. is an independent, public company incorporated under the Laws of Singapore, trading on the NASDAQ Global Select Market under the symbol "MAXN" - Primary products are the Maxeon line of interdigitated back contact ("IBC") solar cells and panels, and the Performance line (formerly "P-Series") of shingled solar cells and panels - As of October 2, 2022, TotalEnergies's and TZE SG's ownership of the Company's outstanding common stock was approximately **24.4%** and **24.0%**, respectively[18](index=18&type=chunk) [Liquidity](index=12&type=section&id=Liquidity) Maxeon's unrestricted cash and equivalents increased, supplemented by short-term securities and new convertible notes, improving short-term liquidity, though long-term cash needs are uncertain Liquidity Metrics | Metric | October 2, 2022 (in millions) | January 2, 2022 (in millions) | | :-------------------------------- | :---------------------------- | :---------------------------- | | Unrestricted cash and cash equivalents | $199.1 | $166.5 | | Restricted cash | $38.5 | $25.7 | | Short-term securities | $76.0 | — | - Completed the sale of **$207.0 million** in aggregate principal amount of 7.50% first lien senior secured convertible notes due 2027 to TZE SG, resulting in aggregate net proceeds of approximately **$186.1 million**[20](index=20&type=chunk) - Management believes current cash, cash equivalents, and short-term securities, along with cash expected to be generated from operations, will be sufficient to meet obligations over the next 12 months[22](index=22&type=chunk) - Long-term cash requirements are uncertain due to dynamic markets, capital market volatility, rising inflation and interest rates, supply chain challenges, and global events, limiting visibility to quantify expected needs[23](index=23&type=chunk) [Seasonal Trends](index=13&type=section&id=Seasonal%20Trends) Maxeon's business experiences seasonal fluctuations, with the majority of revenues historically realized during the last two quarters of a fiscal year due to weather and economic factors - Sales have historically reflected seasonal trends with the largest percentage of total revenues realized during the last two quarters of a fiscal year[26](index=26&type=chunk) - The installation of solar power components and related revenue may decline during cold and/or rainy winter months for the distributed generation market[26](index=26&type=chunk) [Basis of Presentation](index=13&type=section&id=Basis%20of%20Presentation) Unaudited condensed consolidated financial statements are prepared in conformity with GAAP, relying on management estimates, and consolidate Maxeon, its subsidiaries, and primary beneficiary VIEs - The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions[29](index=29&type=chunk) - The company has a 52-to-53-week fiscal year that ends on the Sunday closest to December 31[30](index=30&type=chunk) - The condensed consolidated financial statements incorporate the accounts of Maxeon, all subsidiaries, and variable interest entities for which the Company or a subsidiary is the primary beneficiary[31](index=31&type=chunk) [Summary of Selected Significant Accounting Policies](index=14&type=section&id=Summary%20of%20Selected%20Significant%20Accounting%20Policies) Effective January 1, 2022, Maxeon extended its product warranty for solar panels to 40 years in certain countries, maintaining reserves based on historical claims and industry data - Effective from January 1, 2022, the product warranty for solar panels has been extended to a **40-year warranty** for certain countries, subject to certain conditions, for defects in materials and workmanship and for greater than promised declines in power performance[33](index=33&type=chunk) - Warranty reserves are based on the best estimate of such costs and are recognized as a cost of revenue, continuously monitored based on historical claims, lab testing, field monitoring, vendor reliability, and industry averages[35](index=35&type=chunk) [Recently Adopted Accounting Pronouncements](index=15&type=section&id=Recently%20Adopted%20Accounting%20Pronouncements) Maxeon adopted ASU 2020-06, reclassifying convertible debt from equity to liability, and ASU 2021-10 for government assistance disclosures with no material impact - Adopted ASU 2020-06 during the first quarter of fiscal year 2022 on a modified retrospective basis, which eliminated the bifurcation of the liability and equity components of the Green Convertible Notes into a single liability instrument[37](index=37&type=chunk) - The adoption of ASU 2020-06 resulted in an increase to the carrying value of the convertible debt by **$42.1 million**, a reduction in additional paid-in-capital by **$52.2 million**, and a **$10.1 million** cumulative effect of adoption recognized to the opening balance of accumulated deficit[37](index=37&type=chunk) - Adopted ASU 2021-10, Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance, during the first quarter of fiscal year 2022 with no material impact on its interim financial statements[38](index=38&type=chunk) [NOTE 2. AGREEMENTS WITH SUNPOWER, TOTALENERGIES SE AND TZE](index=15&type=section&id=NOTE%202.%20AGREEMENTS%20WITH%20SUNPOWER%2C%20TOTALENERGIES%20SE%20AND%20TZE) Maxeon maintains significant agreements with SunPower for IBC Modules, TotalEnergies for PV modules and prepayments, and TZE for silicon wafers and convertible notes [Agreements with SunPower](index=15&type=section&id=Agreements%20with%20SunPower) Maxeon's Master Supply Agreement with SunPower mandates minimum IBC Module purchases through 2023 at fixed prices, with polysilicon cost adjustment provisions - Entered into a new master supply agreement with SunPower in February 2022, which terminates and replaces the previous supply agreement[42](index=42&type=chunk) - SunPower is required to purchase, and Maxeon is required to supply, specified amounts of IBC Modules for use in the Domestic Territory during each calendar quarter of the term, continuing until December 31, 2023[42](index=42&type=chunk)[43](index=43&type=chunk) - Pricing for sales to SunPower is fixed for 2022 and 2023, based on the power output of the IBC Module, with a provision for price adjustment if polysilicon costs fluctuate above a specified threshold[43](index=43&type=chunk) [Agreements with TotalEnergies](index=16&type=section&id=Agreements%20with%20TotalEnergies) Maxeon's supply agreement with TotalEnergies involves prepayments for PV modules, with updated pricing and repayment terms, and a new prepayment for Performance line modules - Original Total Supply Agreement (Nov 2016) for up to **200 MW**, with a **$88.5 million** prepayment received[44](index=44&type=chunk) - Second Amended and Restated Initial Implementing Agreement (Feb 2021) for supply of approximately **70 MW** of PV modules until December 31, 2025, with amended pricing and repayment of the prepayment difference in 12 installments from Q1 2023 to Q4 2025[46](index=46&type=chunk) - Received **$57.1 million** prepayment from Danish Fields Solar LLC (a TotalEnergies subsidiary) for Performance line modules as of October 2, 2022, with deliveries expected by Q3 2023[47](index=47&type=chunk) Contract Liabilities with TotalEnergies (in thousands) | Contract Liabilities with TotalEnergies (in thousands) | | :--------------------------------------------------- | | **As of October 2, 2022:** | | Accrued liabilities: $5,600 | | Contract liabilities, current portion: $58,900 | | Contract liabilities, net of current portion: $500 | | Other long-term liabilities: $16,700 | | **As of January 2, 2022:** | | Contract liabilities, current portion: $31,100 | | Contract liabilities, net of current portion: $23,800 | | Other long-term liabilities: $22,600 | [Agreements with TZE](index=17&type=section&id=Agreements%20with%20TZE) Maxeon has strategic agreements with TZE, including a private placement of shares, a silicon wafer supply agreement, and the recent issuance of $207 million in 2027 convertible notes - In April 2021, the Company sold **1,870,000** ordinary shares to TZE at **$18.00 per share** in a private placement[51](index=51&type=chunk) - Entered into a silicon wafer master supply agreement with Zhonghuan Hong Kong Ltd (TZE HK) in November 2021 for P-Type G12 wafers, with deliveries commencing in 2022[52](index=52&type=chunk) Advances to Suppliers (TZE HK) (in thousands) | Advances to Suppliers (TZE HK) (in thousands) | | :------------------------------------------ | | **As of October 2, 2022:** | | Advances to suppliers, current portion: $3,900 | | **As of January 2, 2022:** | | Advances to suppliers, current portion: $1,800 | | Advances to suppliers, non-current portion: $700 | - Completed the sale of **$207.0 million** in aggregate principal amount of 7.50% first lien senior secured convertible notes due 2027 to TZE SG on August 17, 2022[54](index=54&type=chunk) [NOTE 3. REVENUE FROM CONTRACTS WITH CUSTOMERS](index=18&type=section&id=NOTE%203.%20REVENUE%20FROM%20CONTRACTS%20WITH%20CUSTOMERS) Maxeon recognized increased revenue from module and component sales, with contract liabilities significantly rising due to additional customer advances [Revenue from Sales of Modules and Components](index=18&type=section&id=Revenue%20from%20Sales%20of%20Modules%20and%20Components) Maxeon recognized increased revenue from module and component sales for both three and nine-month periods, with revenue recognized upon control transfer, typically at shipment or delivery Revenue from Sales of Modules and Components (in millions) | Metric | Three Months Ended Oct 2, 2022 (in millions) | Three Months Ended Oct 3, 2021 (in millions) | Nine Months Ended Oct 2, 2022 (in millions) | Nine Months Ended Oct 3, 2021 (in millions) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | :----------------------------------------- | :----------------------------------------- | | Revenue from sales of modules and components | $275.4 | $220.5 | $736.6 | $561.8 | - Revenue is recognized for sales of modules and components at the point that control transfers to the customer, which typically occurs upon shipment or delivery, with payment terms typically between 30 and 45 days[56](index=56&type=chunk) [Contract Assets and Liabilities](index=18&type=section&id=Contract%20Assets%20and%20Liabilities) Contract assets decreased while contract liabilities significantly increased, primarily due to additional customer advances, with equipment and inventory pledged as collateral Contract Assets and Liabilities (in millions) | Metric | October 2, 2022 (in millions) | January 2, 2022 (in millions) | | :-------------------- | :---------------------------- | :---------------------------- | | Contract assets | $0.6 | $1.6 | | Contract liabilities | $231.7 | $103.1 | - Contract assets decreased by **$1.0 million** for the nine months ended October 2, 2022, primarily due to new billings of previously unbilled receivables[57](index=57&type=chunk) - Contract liabilities increased by **$128.6 million** for the nine months ended October 2, 2022, primarily due to additional customer advances[59](index=59&type=chunk) - As of October 2, 2022, the Company has pledged **$56.6 million** equipment assets and inventory to serve as collateral for the advances from customers[58](index=58&type=chunk) [NOTE 4. BALANCE SHEET COMPONENTS](index=19&type=section&id=NOTE%204.%20BALANCE%20SHEET%20COMPONENTS) This section details specific balance sheet accounts, including increases in accounts receivable, inventories, and prepaid expenses, alongside changes in long-term assets and liabilities [Accounts receivable, net](index=19&type=section&id=Accounts%20receivable%2C%20net) Accounts receivable, net, increased, with SunPower accounting for a larger portion, and the company utilized factoring arrangements for invoices Accounts Receivable, Net (in thousands) | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :---------------------- | :------------------------------- | :------------------------------- | | Accounts receivable, net | $58,481 | $39,730 | - Sold accounts receivable invoices amounting to **$380.0 million** during the nine months ended October 2, 2022, through factoring arrangements[61](index=61&type=chunk) - SunPower accounted for **14.8%** of gross accounts receivable as of October 2, 2022, compared to **9.7%** as of January 2, 2022[63](index=63&type=chunk) [Allowance for credit losses](index=20&type=section&id=Allowance%20for%20credit%20losses) The allowance for credit losses decreased, primarily due to releases from expense during the nine-month period Allowance for Credit Losses (in thousands) | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :-------------------------- | :------------------------------- | :------------------------------- | | Balance at end of period | $724 | $940 | - Release from expense of **$(0.1) million** for the nine months ended October 2, 2022[64](index=64&type=chunk) [Allowance for sales returns](index=20&type=section&id=Allowance%20for%20sales%20returns) The allowance for sales returns decreased, mainly due to charges to expense during the nine-month period Allowance for Sales Returns (in thousands) | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :-------------------------- | :------------------------------- | :------------------------------- | | Balance at end of period | $80 | $225 | - Charges to (Releases from) expense of **$(0.1) million** for the nine months ended October 2, 2022[65](index=65&type=chunk) [Inventories](index=20&type=section&id=Inventories) Inventories significantly increased, accompanied by a substantial rise in inventory reserves during the period Inventories (in thousands) | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :---------- | :------------------------------- | :------------------------------- | | Inventories | $300,850 | $212,820 | Inventory Reserves (in millions) | Inventory Reserves (in millions) | | :------------------------------- | | October 2, 2022: $30.8 | | January 2, 2022: $4.9 | [Prepaid expenses and other current assets](index=20&type=section&id=Prepaid%20expenses%20and%20other%20current%20assets) Prepaid expenses and other current assets nearly doubled, driven by derivative financial instruments and restricted cash Prepaid Expenses and Other Current Assets (in thousands) | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :-------------------------------- | :------------------------------- | :------------------------------- | | Prepaid expenses and other current assets | $119,794 | $61,904 | Key Components (Oct 2, 2022 vs Jan 2, 2022, in thousands) | Key Components (Oct 2, 2022 vs Jan 2, 2022, in thousands) | | :-------------------------------------------------------- | | Derivative financial instruments: $12,887 vs $3,526 | | Restricted cash: $35,968 vs $1,661 | [Property, plant and equipment, net](index=21&type=section&id=Property%2C%20plant%20and%20equipment%2C%20net) Property, plant and equipment, net, remained relatively stable, with gross assets increasing but offset by rising accumulated depreciation Property, Plant and Equipment, Net (in thousands) | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :-------------------------------- | :------------------------------- | :------------------------------- | | Property, plant and equipment, net | $385,750 | $386,630 | - Construction-in-process decreased from **$124.5 million** as of January 2, 2022, to **$25.6 million** as of October 2, 2022[68](index=68&type=chunk) [Other long-term assets](index=21&type=section&id=Other%20long-term%20assets) Other long-term assets decreased, mainly due to reduced prepayment for capital expenditure and restricted cash, partially offset by an increase in Prepaid Forward Other Long-Term Assets (in thousands) | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :------------------- | :------------------------------- | :------------------------------- | | Other long-term assets | $74,667 | $115,077 | Key Components (Oct 2, 2022 vs Jan 2, 2022, in thousands) | Key Components (Oct 2, 2022 vs Jan 2, 2022, in thousands) | | :-------------------------------------------------------- | | Prepaid Forward: $52,388 vs $32,250 | | Prepayment for capital expenditure: $6,286 vs $34,631 | | Restricted cash: $2,509 vs $24,029 | [Accrued liabilities](index=21&type=section&id=Accrued%20liabilities) Accrued liabilities increased, driven by employee compensation, VAT payables, and new refund liabilities to TotalEnergies, while short-term warranty reserves decreased Accrued Liabilities (in thousands) | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :------------------ | :------------------------------- | :------------------------------- | | Accrued liabilities | $89,103 | $78,680 | Key Components (Oct 2, 2022 vs Jan 2, 2022, in thousands) | Key Components (Oct 2, 2022 vs Jan 2, 2022, in thousands) | | :-------------------------------------------------------- | | Employee compensation and employee benefits: $24,369 vs $18,769 | | Short-term warranty reserves: $7,067 vs $11,457 | | VAT payables: $10,699 vs $6,687 | | Refund liabilities to TotalEnergies, current portion: $5,569 vs $0 | [Other long-term liabilities](index=23&type=section&id=Other%20long-term%20liabilities) Other long-term liabilities slightly decreased, mainly due to reductions in refund liabilities to TotalEnergies and unrecognized tax benefits, with a slight increase in long-term warranty reserves Other Long-Term Liabilities (in thousands) | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :------------------------ | :------------------------------- | :------------------------------- | | Other long-term liabilities | $56,983 | $61,039 | Key Components (Oct 2, 2022 vs Jan 2, 2022, in thousands) | Key Components (Oct 2, 2022 vs Jan 2, 2022, in thousands) | | :-------------------------------------------------------- | | Long-term warranty reserves: $25,271 vs $23,762 | | Unrecognized tax benefits: $8,042 vs $9,834 | | Refund liabilities to TotalEnergies, net of current portion: $16,706 vs $22,566 | [Accumulated other comprehensive loss](index=23&type=section&id=Accumulated%20other%20comprehensive%20loss) Accumulated other comprehensive loss remained relatively stable, influenced by a larger cumulative translation adjustment loss offset by increased net unrealized gain on derivative instruments Accumulated Other Comprehensive Loss (in thousands) | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :-------------------------------- | :------------------------------- | :------------------------------- | | Accumulated other comprehensive loss | $(11,996) | $(11,844) | Key Components (Oct 2, 2022 vs Jan 2, 2022, in thousands) | Key Components (Oct 2, 2022 vs Jan 2, 2022, in thousands) | | :-------------------------------------------------------- | | Cumulative translation adjustment: $(26,515) vs $(18,741) | | Net unrealized gain on derivative instruments: $10,310 vs $2,689 | [NOTE 5. FAIR VALUE MEASUREMENTS](index=23&type=section&id=NOTE%205.%20FAIR%20VALUE%20MEASUREMENTS) Maxeon measures certain assets and liabilities at fair value, primarily using Level 2 inputs, and holds held-to-maturity debt securities and non-marketable equity investments [Assets and Liabilities Measured at Fair Value on a Recurring Basis](index=24&type=section&id=Assets%20and%20Liabilities%20Measured%20at%20Fair%20Value%20on%20a%20Recurring%20Basis) Maxeon's assets and liabilities measured at fair value on a recurring basis primarily use Level 2 inputs, with total fair value assets significantly increasing - Fair value is estimated by applying a hierarchy: Level 1 (quoted prices in active markets), Level 2 (observable inputs other than Level 1), Level 3 (unobservable management inputs)[74](index=74&type=chunk) Fair Value Assets and Liabilities (in thousands) | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :-------------------------------- | :------------------------------- | :------------------------------- | | Total assets measured at fair value | $65,275 | $35,776 | | Total liabilities measured at fair value | $918 | $536 | - All recurring fair value measurements utilize Level 2 inputs[75](index=75&type=chunk) [Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis](index=24&type=section&id=Assets%20and%20Liabilities%20Measured%20at%20Fair%20Value%20on%20a%20Non-Recurring%20Basis) Maxeon measures certain investments and non-financial assets at fair value on a non-recurring basis when impaired, with no material items recorded during the period - No material items were recorded at fair value on a non-recurring basis as of October 2, 2022, or January 2, 2022[76](index=76&type=chunk) [Held-to-Maturity Debt Securities](index=24&type=section&id=Held-to-Maturity%20Debt%20Securities) Maxeon holds held-to-maturity debt securities, including Philippine government bonds and a time deposit, recorded at amortized cost with no impairment losses - Held-to-maturity debt securities include Philippine government bonds (**$0.9 million** as of October 2, 2022) and a **$76.0 million** 4-month time deposit with Deutsche Bank AG, Singapore Branch, maturing in January 2023[78](index=78&type=chunk)[79](index=79&type=chunk) - These securities are recorded at amortized cost based on the ability and intent to hold them until maturity[80](index=80&type=chunk) - No other-than-temporary impairment loss was incurred during the period presented[80](index=80&type=chunk) [Non-Marketable Equity Investments](index=24&type=section&id=Non-Marketable%20Equity%20Investments) Maxeon's non-marketable equity investments are in privately-held companies, recognized at cost less impairment, adjusted for observable price changes Non-Marketable Equity Investments (in millions) | Metric | October 2, 2022 (in millions) | January 2, 2022 (in millions) | | :-------------------------------- | :---------------------------- | :---------------------------- | | Non-marketable equity investments | $4.0 | $4.0 | - Recognized at cost less impairment, adjusted for observable price changes in orderly transactions for an identical or similar investment of the same issuer[81](index=81&type=chunk) [Equity Method Investments](index=25&type=section&id=Equity%20Method%20Investments) Maxeon monitors its equity method investments for impairment, recording reductions in carrying values when necessary, indicated by Level 3 measurements - Equity method investments are monitored for impairment, with reductions in carrying values recorded when necessary[82](index=82&type=chunk) - Circumstances indicating an other-than-temporary decline include Level 3 measurements such as valuation in subsequent financing rounds, decreases in quoted market prices, and declines in the issuer's results of operations[82](index=82&type=chunk) [NOTE 6. COMMITMENTS AND CONTINGENCIES](index=25&type=section&id=NOTE%206.%20COMMITMENTS%20AND%20CONTINGENCIES) Maxeon has significant purchase commitments, advances to suppliers, ongoing legal matters, and standby letters of credit, with a provision made for a new legal claim [Purchase Commitments](index=25&type=section&id=Purchase%20Commitments) Maxeon has significant future purchase obligations for non-cancellable orders and long-term supply agreements, including a settlement with a polysilicon supplier for price escalation Future Purchase Obligations (as of October 2, 2022, in millions) | Future Purchase Obligations (as of October 2, 2022, in millions) | | :------------------------------------------------------------- | | Non-cancellable purchase orders: $149.9 | | Long-term supply agreements: $169.4 | - Reached a mutual agreement on a one-off and final settlement of **$15.2 million** with a polysilicon supplier for price escalation clauses, with payments to be made in equal monthly installments from August 2022 until January 2023[85](index=85&type=chunk) - Expects all obligations related to non-cancellable purchase orders for manufacturing equipment to be recovered through future cash flows and long-term supply agreements for inventories to be utilized in the manufacture and profitable sale of solar power products[87](index=87&type=chunk) [Advances to Suppliers](index=26&type=section&id=Advances%20to%20Suppliers) Advances to suppliers decreased, primarily for "take or pay" contracts with two main suppliers, requiring prepayments to reserve future product volumes Advances to Suppliers (in millions) | Metric | October 2, 2022 (in millions) | January 2, 2022 (in millions) | | :------------------ | :---------------------------- | :---------------------------- | | Advances to suppliers | $13.9 | $51.8 | - Agreements with vendors are structured as "take or pay" contracts, specifying future quantities and pricing of products, and requiring prepayments[89](index=89&type=chunk) - Two suppliers accounted for **100%** of total advances to suppliers as of October 2, 2022, and January 2, 2022[89](index=89&type=chunk) [Legal Matters](index=26&type=section&id=Legal%20Matters) Maxeon is involved in various litigation matters, with a provision made for an estimated exposure related to a new legal claim from a supplier, and SunPower indemnifies for certain claims - Received a legal claim from a supplier during the nine months ended October 2, 2022, and made a provision for the estimated exposure in "Accrued liabilities"[91](index=91&type=chunk) - SunPower has agreed to indemnify Maxeon for certain litigation claims to which certain subsidiaries are named the defendant or party[90](index=90&type=chunk) [Letters of Credit and Bank Guarantees](index=26&type=section&id=Letters%20of%20Credit%20and%20Bank%20Guarantees) Maxeon's maximum potential payment obligations under standby letters of credit and bank guarantees increased, collateralized by restricted cash, with no anticipated significant payments Maximum Potential Payment Obligation (in millions) | Metric | October 2, 2022 (in millions) | January 2, 2022 (in millions) | | :------------------------------------------------- | :---------------------------- | :---------------------------- | | Maximum potential payment obligation under guarantee agreements | $45.2 | $31.7 | - Certain guarantee agreements are collateralized by restricted cash of **$38.1 million** as of October 2, 2022, and **$24.1 million** as of January 2, 2022[92](index=92&type=chunk) - The company does not believe it is probable that any amounts will be required to be paid under these guarantee agreements[92](index=92&type=chunk) [NOTE 7. EQUITY INVESTMENTS](index=26&type=section&id=NOTE%207.%20EQUITY%20INVESTMENTS) Maxeon holds equity method investments in Huansheng JV and CCPV, an equity investment in Deca Technologies, Inc., and consolidates SPML Land, Inc. as a VIE [Equity Method Investments](index=27&type=section&id=Equity%20Method%20Investments) Maxeon accounts for investments in Huansheng JV and CCPV using the equity method, with its ownership in Huansheng JV diluted due to a capital injection by TZE - Maxeon accounts for its investment in Huansheng JV using the equity method, with its equity ownership diluted from **20.0%** to **16.3%** in September 2021 due to TZE's capital injection[94](index=94&type=chunk)[95](index=95&type=chunk) - Maxeon's investment in CCPV (**25%** equity ownership) was fully impaired in fiscal year 2017[96](index=96&type=chunk)[97](index=97&type=chunk) Equity Method Investments (in thousands) | Equity Method Investments (in thousands) | | :--------------------------------------- | | October 2, 2022: $1,208 | | January 2, 2022: $11,230 | [Equity Investments without Readily Determinable Fair Value](index=27&type=section&id=Equity%20Investments%20without%20Readily%20Determinable%20Fair%20Value) Maxeon holds an equity investment in Deca Technologies, Inc., recognized at cost less impairment, adjusted for observable price changes in transactions Equity Investments without Readily Determinable Fair Value (in thousands) | Equity Investments without Readily Determinable Fair Value (in thousands) | | :---------------------------------------------------------------------- | | October 2, 2022: $4,000 | | January 2, 2022: $4,000 | - Investment in Deca Technologies, Inc. is recognized at cost less impairment, adjusted for observable price changes in orderly transactions[81](index=81&type=chunk)[98](index=98&type=chunk) [Variable Interest Entities ("VIE")](index=28&type=section&id=Variable%20Interest%20Entities%20%28%22VIE%22%29) Maxeon evaluates its investments in VIEs using a qualitative approach to determine if it is the primary beneficiary, based on power to direct activities and exposure to losses or benefits - An entity is considered the primary beneficiary of a VIE if it has the power to direct the activities that most significantly impact the economic performance of the VIE and the right to receive benefits from, or the obligation to absorb losses of, the VIE that could be potentially significant[101](index=101&type=chunk) [Consolidated VIE](index=29&type=section&id=Consolidated%20VIE) Maxeon consolidates SPML Land, Inc. as a primary beneficiary VIE, despite owning only 40% equity, due to its power to direct activities and exposure to significant profits or losses - Maxeon consolidates SPML Land, Inc. because it is deemed the primary beneficiary, having the power to direct activities that significantly impact its economic performance and exposure to significant profits or losses[104](index=104&type=chunk) SPML Land, Inc. Aggregate Carrying Amounts (in millions) | SPML Land, Inc. Aggregate Carrying Amounts (in millions) | | :------------------------------------------------------- | | **As of October 2, 2022:** | | Total assets: $22.9 | | Total liabilities: $6.2 | | **As of January 2, 2022:** | | Total assets: $22.4 | | Total liabilities: $7.7 | [NOTE 8. DEBT AND CREDIT SOURCES](index=29&type=section&id=NOTE%208.%20DEBT%20AND%20CREDIT%20SOURCES) Maxeon's debt structure includes Green Convertible Notes and new 2027 Convertible Notes, with ASU 2020-06 impacting carrying values, alongside a Physical Delivery Forward and a Prepaid Forward [Green Convertible Notes](index=29&type=section&id=Green%20Convertible%20Notes) Maxeon issued $200.0 million in 6.5% Green Convertible Senior Notes due 2025, with their carrying amount increasing after the adoption of ASU 2020-06 - Issued **$200.0 million** aggregate principal amount of 6.5% Green Convertible Senior Notes due 2025[106](index=106&type=chunk) - The adoption of ASU 2020-06 increased the carrying amount of the Green Convertible Notes by **$42.1 million** to **$187.8 million** as of January 3, 2022, eliminating the bifurcation of liability and equity components[107](index=107&type=chunk) Green Convertible Notes (in millions) | Metric | October 2, 2022 (in millions) | January 2, 2022 (in millions) | | :-------------------- | :---------------------------- | :---------------------------- | | Net carrying amount | $190.4 | $145.8 | | Fair value | $293.7 | $218.5 | [Physical Delivery Forward](index=30&type=section&id=Physical%20Delivery%20Forward) Maxeon entered into a Physical Delivery Forward transaction for ordinary shares, initially a liability-classified instrument, subsequently reclassified to equity after the Note Valuation Period - Entered into a privately negotiated forward-starting physical delivery forward transaction for approximately **$60.0 million** worth of ordinary shares[111](index=111&type=chunk) - The Physical Delivery Forward was a liability-classified financial instrument that was remeasured to fair value during the Note Valuation Period and subsequently reclassified to equity after the period ended on September 29, 2020[112](index=112&type=chunk) [Prepaid Forward](index=31&type=section&id=Prepaid%20Forward) Maxeon entered into a Prepaid Forward transaction to repurchase ordinary shares, classified as an asset and remeasured to fair value each period, with changes booked in earnings - Entered into a privately negotiated forward-starting forward share purchase transaction to repurchase approximately **$40.0 million** worth of ordinary shares[113](index=113&type=chunk) - The Prepaid Forward is classified as an asset and remeasured to fair value at the end of each reporting period, with changes in fair value booked in earnings[115](index=115&type=chunk) Prepaid Forward (in millions) | Metric | October 2, 2022 (in millions) | January 2, 2022 (in millions) | | :-------------------- | :---------------------------- | :---------------------------- | | Carrying amount | $52.4 | $32.3 | - Remeasurement to fair value for the nine months ended October 2, 2022, was a gain of **$20.1 million**[115](index=115&type=chunk) [2027 Convertible debt](index=31&type=section&id=2027%20Convertible%20debt) Maxeon sold $207.0 million in 7.5% first lien senior secured convertible notes due 2027 to TZE SG, with interest payable in cash, PIK Notes, or ordinary shares - Completed the sale of **$207.0 million** aggregate principal amount of 7.5% first lien senior secured convertible notes due 2027 to TZE SG on August 17, 2022[116](index=116&type=chunk) - Interest accrues at **7.5% per annum**, payable semi-annually, with the initial **3.5%** in cash and the remaining **4.0%** payable in cash, PIK Notes, or ordinary shares at the Company's election[116](index=116&type=chunk) - Initial conversion price of **$23.13 per ordinary share**, with a conversion rate of **43.2301** ordinary shares for **$1,000** principal amount[117](index=117&type=chunk) 2027 Convertible Debt (in millions) | Metric | October 2, 2022 (in millions) | | :-------------------- | :---------------------------- | | Net carrying amount | $186.5 | | Face value | $207.0 | | Fair value | $200.8 | [Other Debt and Credit Sources](index=32&type=section&id=Other%20Debt%20and%20Credit%20Sources) Maxeon has a $50.0 million revolving credit agreement with Standard Chartered Bank Malaysia Berhad, with most other debt facilities terminated in fiscal year 2021 - Revolving Credit agreement for **$50.0 million** through Standard Chartered Bank Malaysia Berhad, with **$49.9 million** outstanding as of October 2, 2022[121](index=121&type=chunk) - A loss on extinguishment of debt of **$5.1 million** was recognized during the three and nine months ended October 3, 2021, due to the termination of certain debt facilities[122](index=122&type=chunk) [NOTE 9. DERIVATIVE FINANCIAL INSTRUMENTS](index=33&type=section&id=NOTE%209.%20DERIVATIVE%20FINANCIAL%20INSTRUMENTS) Maxeon uses derivative financial instruments, primarily foreign currency option and forward contracts, for hedging cash flow and transaction exposures, recognizing a net gain in OCL [Derivative Financial Instruments Overview](index=33&type=section&id=Derivative%20Financial%20Instruments%20Overview) Maxeon's derivative financial instruments, mainly foreign currency option and forward contracts, are measured at fair value using Level 2 inputs, with a net gain recognized in OCL for cash flow hedges Derivative Financial Instruments (in thousands) | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :-------------------- | :------------------------------- | :------------------------------- | | Derivative assets | $12,887 | $3,526 | | Derivative liabilities | $918 | $536 | - All hedge instruments measured at fair value on a recurring basis utilize Level 2 inputs under the fair value hierarchy[124](index=124&type=chunk) - For the nine months ended October 2, 2022, a net gain on derivatives of **$7.6 million** was recognized in Accumulated Other Comprehensive Loss (OCL)[125](index=125&type=chunk) [Foreign Currency Exchange Risk](index=34&type=section&id=Foreign%20Currency%20Exchange%20Risk) Maxeon manages foreign currency exchange risk using designated derivatives to hedge forecasted revenues and expenses, and non-designated forward contracts for balance sheet exposure - Uses foreign currency option contracts and foreign currency forward contracts designated as cash flow hedges to hedge certain forecasted revenue transactions denominated in Euros and Australian dollars[127](index=127&type=chunk) - As of October 2, 2022, had outstanding cash flow hedge option contracts and forward contracts with a notional value of **$233.5 million**[128](index=128&type=chunk) - Held foreign currency forward contracts with an aggregate notional value of **$29.9 million** as of October 2, 2022, for non-designated derivatives hedging balance sheet exposure[130](index=130&type=chunk) [Credit Risk](index=35&type=section&id=Credit%20Risk) Maxeon is exposed to credit losses from nonperformance by derivative counterparties but mitigates this risk by engaging with high-quality financial institutions and continuous assessment - Exposed to credit losses in the event of nonperformance by the counterparties to option and forward contracts[131](index=131&type=chunk) - Mitigates credit risk by entering into derivative contracts with high-quality financial institutions and limiting credit exposure to any single counterparty[131](index=131&type=chunk) [NOTE 10. INCOME TAXES](index=35&type=section&id=NOTE%2010.%20INCOME%20TAXES) Maxeon reported income tax expense primarily due to current year income tax in profitable jurisdictions, with unrecognized tax benefits decreasing due to the expiry of statutes of limitations [Income Tax Expense Overview](index=35&type=section&id=Income%20Tax%20Expense%20Overview) Maxeon's income tax expense was driven by current year income tax in profitable jurisdictions and prior year deferred income tax true-ups, with provisions based on a projected annual effective tax rate - Income tax expense of **$2.4 million** for the three months ended October 2, 2022, primarily due to current year income tax expense in profitable jurisdictions and prior year deferred income tax true-ups[132](index=132&type=chunk) - Provision for income taxes is computed based on a projected annual effective tax rate while excluding loss jurisdictions which cannot be benefited[133](index=133&type=chunk) [Unrecognized Tax Benefits](index=35&type=section&id=Unrecognized%20Tax%20Benefits) Unrecognized tax benefits decreased, mainly due to the expiry of statutes of limitations, as the company regularly assesses its tax positions amidst complex global tax regulations Unrecognized Tax Benefits (in millions) | Metric | October 2, 2022 (in millions) | January 2, 2022 (in millions) | | :------------------------ | :---------------------------- | :---------------------------- | | Unrecognized tax benefits | $8.0 | $9.8 | - The reduction in unrecognized tax benefits was mainly due to the expiry of statute of limitations in certain jurisdictions[135](index=135&type=chunk) - The calculation of unrecognized tax benefits involves dealing with uncertainties in the application of complex global tax regulations, including legislative, regulatory, and judicial developments, transfer pricing, and withholding taxes[136](index=136&type=chunk) [NOTE 11. NET LOSS PER SHARE](index=36&type=section&id=NOTE%2011.%20NET%20LOSS%20PER%20SHARE) Maxeon reported basic and diluted net loss per share, with potentially dilutive securities excluded from diluted EPS calculation due to their anti-dilutive effect from the net loss Net Loss Per Share Attributable to Stockholders | Metric | Three Months Ended Oct 2, 2022 | Three Months Ended Oct 3, 2021 | Nine Months Ended Oct 2, 2022 | Nine Months Ended Oct 3, 2021 | | :------------------------------------ | :----------------------------- | :----------------------------- | :---------------------------- | :---------------------------- | | Net loss attributable to stockholders | $(44,691) | $(65,363) | $(191,723) | $(181,188) | | Basic and diluted net loss per share | $(1.09) | $(1.62) | $(4.70) | $(4.97) | - Potentially dilutive securities (restricted stock units, Green Convertible Notes, and 2027 Notes) were excluded from the computation of diluted net loss per share because their effect was anti-dilutive due to the net loss attributable to stockholders[137](index=137&type=chunk) [NOTE 12. SEGMENT AND GEOGRAPHICAL INFORMATION](index=36&type=section&id=NOTE%2012.%20SEGMENT%20AND%20GEOGRAPHICAL%20INFORMATION) Maxeon operates as a single operating and reportable segment, with the United States being the largest geographical market and SunPower accounting for significant sales - The company operates in a single operating segment and a single reportable segment[138](index=138&type=chunk) Revenue by Geography (in thousands) | Revenue by Geography (in thousands) | | :---------------------------------- | | **Nine Months Ended Oct 2, 2022:** | | United States: $266,367 | | France: $58,355 | | Italy: $90,490 | | Rest of the world: $321,398 | | Total revenue: $736,610 | | **Nine Months Ended Oct 3, 2021:** | | United States: $170,029 | | France: $75,340 | | Italy: $58,096 | | Rest of the world: $258,335 | | Total revenue: $561,800 | - Sales to SunPower amounted to **$68.9 million** during the three months ended October 2, 2022[140](index=140&type=chunk) [NOTE 13. RESTRUCTURING](index=37&type=section&id=NOTE%2013.%20RESTRUCTURING) Maxeon initiated two restructuring plans related to the closure of manufacturing facilities in France, with total restructuring expense recorded for the nine months ended October 2, 2022 [May 2021 Restructuring Plan](index=37&type=section&id=May%202021%20Restructuring%20Plan) This plan, initiated in fiscal year 2021, aimed to reduce costs and improve cash flow through the closure of a France-based manufacturing facility, expected to be completed by fiscal year 2022 - Adopted in fiscal year 2021 to reduce costs and focus on improving cash flow, primarily related to the closure of the France-based manufacturing facility[141](index=141&type=chunk) - The restructuring activities are expected to be completed by fiscal year 2022[141](index=141&type=chunk) May 2021 Restructuring Plan Charges (Nine Months Ended Oct 2, 2022, in thousands) | May 2021 Restructuring Plan Charges (Nine Months Ended Oct 2, 2022, in thousands) | | :-------------------------------------------------------------------------------- | | Severance and benefits: $(432) | | Cost of disposal and retirement of property, plant and equipment: $37 | | Total: $(395) | [June 2022 Restructuring Plan](index=37&type=section&id=June%202022%20Restructuring%20Plan) Adopted in fiscal year 2022, this plan also focuses on cost reduction and cash flow improvement, specifically related to the closure of the module factory in Porcelette, France - Adopted in fiscal year 2022 to reduce costs and focus on improving cash flow, primarily related to the closure of the module factory in Porcelette, France[142](index=142&type=chunk) - The restructuring activities are expected to be completed by the first half of 2023[142](index=142&type=chunk) June 2022 Restructuring Plan Charges (Nine Months Ended Oct 2, 2022, in thousands) | June 2022 Restructuring Plan Charges (Nine Months Ended Oct 2, 2022, in thousands) | | :--------------------------------------------------------------------------------- | | Severance and benefits: $1,989 | | Cost of disposal and retirement of property, plant and equipment: $69 | | Total: $2,058 | [NOTE 14. COMMON STOCK](index=39&type=section&id=NOTE%2014.%20COMMON%20STOCK) Maxeon completed a public offering and private placement to TZE, issuing ordinary shares and raising net proceeds, with shares reserved for future issuance under equity compensation plans [Common Stock Issuance](index=39&type=section&id=Common%20Stock%20Issuance) In April 2021, Maxeon completed a public offering and a private placement to TZE, issuing a total of 9,916,025 ordinary shares and raising approximately $169.7 million in net proceeds - In April 2021, the Company completed a public offering and a private placement to TZE, issuing a total of **9,916,025** shares[146](index=146&type=chunk)[147](index=147&type=chunk) - The net proceeds from the Offering and the TZE Private Placement were approximately **$169.7 million**[148](index=148&type=chunk) [Voting Rights - Common Stock](index=39&type=section&id=Voting%20Rights%20-%20Common%20Stock) All common stockholders are entitled to one vote per share on all matters submitted to be voted on by the company's stockholders - All common stockholders are entitled to one vote per share on all matters submitted to be voted on by the company's stockholders[149](index=149&type=chunk) [Dividends - Common Stock](index=39&type=section&id=Dividends%20-%20Common%20Stock) Common stockholders are entitled to equal per share dividends when declared by the Board of Directors, subject to restrictions imposed by certain debt agreements - All common stockholders are entitled to receive equal per share dividends when and if declared by the Board of Directors[150](index=150&type=chunk) - Certain debt agreements place restrictions on the company and its subsidiaries' ability to pay cash dividends[150](index=150&type=chunk) [Shares Reserved for Future Issuance Under Equity Compensation Plans](index=40&type=section&id=Shares%20Reserved%20for%20Future%20Issuance%20Under%20Equity%20Compensation%20Plans) As of October 2, 2022, 3.3 million shares of common stock were reserved for future issuance under equity compensation plans, a slight decrease from January 2, 2022 Shares Reserved for Future Issuance (in thousands) | Metric | October 2, 2022 (in thousands) | January 2, 2022 (in thousands) | | :------------------------------------------------- | :------------------------------- | :------------------------------- | | Shares reserved for future issuance under equity compensation plans | 3,281 | 3,363 |

Maxeon Solar Technologies, Ltd. (NASDAQ:MAXN) Q2 2022 Earnings Conference Call August 18, 2022 5:30 PM ET Company Participants Robert Lahey - Head of IR Jeff Waters - CEO Kai Strohbecke - CFO Conference Call Participants Donovan Schafer - Northland Capital Markets Philip Shen - ROTH Capital Partners Pavel Molchanov - Raymond James Kevin Pollard - Pickering Energy Partners Operator Good day, and thank you for standing by. Welcome to Maxeon Solar Technologies' Second Quarter 2022 Earnings Conference Call. At ...

[Executive Summary](index=1&type=section&id=Executive%20Summary) Maxeon Solar Technologies reported Q2 2022 financial results, highlighting record EU distributed generation revenue, US utility-scale business expansion, and successful funding for Maxeon 7 technology and capacity transformation [Announcement Highlights](index=1&type=section&id=Announcement%20Highlights) Maxeon Solar Technologies announced Q2 2022 financial results, highlighting record EU distributed generation (DG) revenue, initial high-volume shipments for US utility-scale business, and funding for Maxeon 7 technology for mass production - Maxeon Solar Technologies announced Q2 2022 financial results[1](index=1&type=chunk) - Record revenue from EU distributed generation (DG) business[1](index=1&type=chunk) - US utility-scale business commenced high-volume shipments[1](index=1&type=chunk) - Maxeon 7 technology secured funding for mass production readiness[1](index=1&type=chunk) [CEO Commentary and Q2 2022 Snapshot](index=1&type=section&id=CEO%20Commentary%20and%20Q2%202022%20Snapshot) CEO Jeff Waters highlighted strong technology demand, record EU DG revenue, US market expansion, and a successful **$207 million** convertible bond issuance to fund Maxeon 7 and capacity transformation, with plans for **3 GW** additional US capacity - Technology demand continued to strengthen, with record EU DG revenue and **1.2 GW** of new orders for US utility-scale business[2](index=2&type=chunk) - Secured **$207 million** in private convertible bonds from major shareholder TZE to fund the Maxeon 7 transition project[2](index=2&type=chunk) - Capacity transformation progressed: Maxeon 5 modules discontinued, Maxeon 6 capacity expected to be fully utilized later this year, Maxeon 7 pilot line met performance targets with scale-up planned, Performance Line projected to reach **1.8 GW** early next year, and accelerated plans for **3 GW** additional US capacity due to the Inflation Reduction Act[2](index=2&type=chunk) Key Unaudited Financial Data for Q2 2022 | (In thousands, except shipments in MW) | Fiscal Q2 2022 | Fiscal Q1 2022 | Fiscal Q2 2021 | | :------------------------------ | :------------- | :------------- | :------------- | | Shipments, in MW | 521 | 488 | 434 | | Revenue | $238,080 thousand | $223,081 thousand | $175,895 thousand | | Gross loss | $(39,324) thousand | $(12,964) thousand | $(2,812) thousand | | GAAP Operating expenses | $35,701 thousand | $37,410 thousand | $38,069 thousand | | GAAP Net loss attributable to the stockholders | $(87,920) thousand | $(59,112) thousand | $(77,011) thousand | | Capital expenditures | $18,231 thousand | $21,682 thousand | $51,703 thousand | [Financial Performance - Q2 2022](index=1&type=section&id=Financial%20Performance%20-%20Q2%202022) This section details Maxeon's Q2 2022 GAAP and non-GAAP financial results, including revenue, gross loss, operating expenses, and Adjusted EBITDA, alongside the impact of polysilicon costs [Selected Unaudited Financial Summary (GAAP & Non-GAAP)](index=1&type=section&id=Selected%20Unaudited%20Financial%20Summary%20(GAAP%20%26%20Non-GAAP)) This section presents key GAAP and non-GAAP financial metrics for Q2 2022, Q1 2022, and Q2 2021, including non-GAAP gross loss, operating expenses, and Adjusted EBITDA, for a comprehensive performance overview Selected Unaudited Financial Summary | (In thousands) | Fiscal Q2 2022 | Fiscal Q1 2022 | Fiscal Q2 2021 | | :------------- | :------------- | :------------- | :------------- | | Non-GAAP Gross loss | $(23,905) thousand | $(12,542) thousand | $(2,629) thousand | | Non-GAAP Operating expenses | $30,162 thousand | $34,367 thousand | $31,200 thousand | | Adjusted EBITDA | $(36,833) thousand | $(33,590) thousand | $(23,536) thousand | [Supplementary Information Affecting GAAP and Non-GAAP Results](index=2&type=section&id=Supplementary%20Information%20Affecting%20GAAP%20and%20Non-GAAP%20Results) This section details the impact of polysilicon costs on GAAP and non-GAAP results, including incremental costs from above-market prices and losses from selling excess polysilicon Impact of Polysilicon Costs on Results | (In thousands) | July 3, 2022 | April 3, 2022 | July 4, 2021 | | :------------- | :----------- | :------------ | :----------- | | Incremental cost of above market polysilicon | $3,308 thousand | $7,388 thousand | $12,538 thousand | | Loss on ancillary sales of excess polysilicon | $— thousand | $8,328 thousand | $2,498 thousand | - Incremental cost of above-market polysilicon is calculated as the difference between long-term fixed supply agreements and market prices[5](index=5&type=chunk) - Loss on ancillary sales of excess polysilicon resulted from selling inventory at market prices below purchase cost to reduce inventory and improve working capital[5](index=5&type=chunk) [Outlook - Q3 2022](index=2&type=section&id=Outlook%20-%20Q3%202022) The company provides its preliminary, unaudited financial outlook for Q3 2022, including expected shipments, revenue, gross loss, operating expenses, Adjusted EBITDA, and capital expenditures [Third Quarter 2022 Outlook](index=2&type=section&id=Third%20Quarter%202022%20Outlook) The company provided preliminary, unaudited Q3 2022 financial outlook, projecting shipments of **580-620 MW**, revenue of **$270-290 million**, and expected ranges for gross loss, operating expenses, Adjusted EBITDA, and capital expenditures, based on current management views Q3 2022 Financial Outlook | (In millions, except shipments in MW) | Outlook | | :------------------------------ | :------ | | Shipments, in MW | 580 - 620 MW | | Revenue | $270 - $290 million | | Gross loss | $10 - $20 million | | Non-GAAP gross loss | $10 - $20 million | | Operating expenses | $38 ± $1 million | | Non-GAAP operating expenses | $35 ± $1 million | | Adjusted EBITDA | $(27) - $(37) million | | Capital expenditures | $21 - $25 million | | Out-of-market polysilicon cost | $1 million | - The outlook is preliminary and unaudited, based on management's current views and estimates regarding market conditions, production capacity, ongoing COVID-19 uncertainties, and the global economic environment[7](index=7&type=chunk) [Company Information & Disclosures](index=4&type=section&id=Company%20Information%20%26%20Disclosures) This section provides investor access information, an overview of Maxeon Solar Technologies, forward-looking statements, and reconciliations of non-GAAP financial measures [Investor Information](index=4&type=section&id=Investor%20Information) This section provides investors access to Maxeon Solar Technologies' Q2 2022 financial results and management commentary via the company website and SEC filings, along with earnings call details - Maxeon's Q2 2022 financial results and management commentary are available on the company's investor relations website and via Form 6-K on the SEC website[8](index=8&type=chunk) - The company will host a conference call to discuss results on August 18, 2022, at 5:30 PM ET[9](index=9&type=chunk) [About Maxeon Solar Technologies](index=4&type=section&id=About%20Maxeon%20Solar%20Technologies) Maxeon Solar Technologies, headquartered in Singapore, is a global solar innovation leader designing and manufacturing Maxeon® and SunPower® brand solar panels, operating in over **100** countries - Maxeon Solar Technologies, headquartered in Singapore, is a global leader in solar innovation[11](index=11&type=chunk) - Designs and manufactures Maxeon® and SunPower® brand solar panels, with sales operations in over **100** countries[11](index=11&type=chunk) - Holds over **1,000** patents, serving global rooftop and power plant markets through a network of over **1,700** partners and distributors[11](index=11&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This section contains forward-looking statements regarding pricing trends, demand growth, operational disruptions, product launches, strategic plans, financial needs, technology outlook, and Q3 2022 guidance, along with risks that could cause actual results to differ materially - Forward-looking statements cover pricing trends, demand and growth projections, operational and supply chain disruptions, product launch timing, short- and long-term strategies, cash needs and financing capabilities, technology outlook (Maxeon 5, 6, 7, and Performance Line), strategic goals, and Q3 2022 guidance[12](index=12&type=chunk)[13](index=13&type=chunk) - Risk factors include challenges in executing strategic plans, liquidity, debt, increased supply chain costs, operational disruptions (e.g., pandemics, natural disasters, military conflicts), customer and supplier management, R&D success, industry competition, regulatory and public policy changes, tax requirements, currency fluctuations, manufacturing capacity, changes in customer demand, and litigation activities[15](index=15&type=chunk) [Use of Non-GAAP Financial Measures](index=7&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures) The company uses non-GAAP financial measures like non-GAAP gross loss, operating expenses, and Adjusted EBITDA to enhance transparency into ongoing operational performance, adjusting for items such as stock-based compensation, restructuring, and polysilicon-related losses - The company uses non-GAAP gross loss, non-GAAP operating expenses, and Adjusted EBITDA to supplement GAAP financial results, enhancing transparency into ongoing operational performance[17](index=17&type=chunk)[18](index=18&type=chunk) - Adjustments for non-GAAP measures include stock-based compensation, restructuring charges, remeasurement loss on prepaid forward contracts, impairment, equity in losses of unconsolidated investees, and losses related to polysilicon supplier price escalation disputes[19](index=19&type=chunk)[20](index=20&type=chunk) - These adjustments aim to exclude items management believes are not indicative of ongoing operations or may distort long-term operating trends, thereby improving performance comparability[18](index=18&type=chunk) [Reconciliation of Non-GAAP Financial Measures](index=9&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures) This section provides detailed reconciliation tables for GAAP to non-GAAP financial measures, including gross loss, operating expenses, and Adjusted EBITDA, covering Q2 2022, Q1 2022, and Q2 2021, plus a Q3 2022 non-GAAP operating expenses outlook reconciliation Non-GAAP Gross Loss Reconciliation | (In thousands) | July 3, 2022 | April 3, 2022 | July 4, 2021 | | :------------- | :----------- | :------------ | :----------- | | Gross loss | $(39,324) thousand | $(12,964) thousand | $(2,812) thousand | | Stock-based compensation | $249 thousand | $422 thousand | $183 thousand | | Loss related to settlement of price escalation dispute | $15,170 thousand | $— thousand | $— thousand | | Non-GAAP Gross loss | $(23,905) thousand | $(12,542) thousand | $(2,629) thousand | Non-GAAP Operating Expenses Reconciliation | (In thousands) | July 3, 2022 | April 3, 2022 | July 4, 2021 | | :------------- | :----------- | :------------ | :----------- | | GAAP Operating expenses | $35,701 thousand | $37,410 thousand | $38,069 thousand | | Stock-based compensation | $(1,896) thousand | $(2,275) thousand | $(1,708) thousand | | Restructuring charges and fees | $(3,643) thousand | $(768) thousand | $(5,161) thousand | | Non-GAAP Operating expenses | $30,162 thousand | $34,367 thousand | $31,200 thousand | Adjusted EBITDA Reconciliation | (In thousands) | July 3, 2022 | April 3, 2022 | July 4, 2021 | | :------------- | :----------- | :------------ | :----------- | | GAAP Net loss attributable to the stockholders | $(87,920) thousand | $(59,112) thousand | $(77,011) thousand | | Interest expense, net | $5,685 thousand | $4,786 thousand | $7,054 thousand | | Provision for (benefit from) income taxes | $937 thousand | $825 thousand | $(1,217) thousand | | Depreciation | $15,305 thousand | $12,898 thousand | $9,681 thousand | | Amortization | $75 thousand | $90 thousand | $65 thousand | | EBITDA | $(65,918) thousand | $(40,513) thousand | $(61,428) thousand | | Impairment | $— thousand | $— thousand | $— thousand | | Stock-based compensation | $2,145 thousand | $2,697 thousand | $1,891 thousand | | Loss related to settlement of price escalation dispute | $15,170 thousand | $— thousand | $— thousand | | Restructuring charges and fees | $3,643 thousand | $768 thousand | $5,161 thousand | | Remeasurement loss on prepaid forward | $3,986 thousand | $397 thousand | $27,035 thousand | | Equity in losses of unconsolidated investees | $4,141 thousand | $3,061 thousand | $3,805 thousand | | Adjusted EBITDA | $(36,833) thousand | $(33,590) thousand | $(23,536) thousand | Non-GAAP Outlook Reconciliation (Q3 2022) | (In millions) | Outlook | | :------------ | :------ | | Operating expenses | $38 ± $1 million | | Stock-based compensation | $(2) million | | Restructuring charges and fees | $(1) million | | Non-GAAP operating expenses | $35 ± $1 million | [Consolidated Financial Statements](index=11&type=section&id=Consolidated%20Financial%20Statements) This section presents the company's condensed consolidated balance sheets, statements of operations, statements of equity, and statements of cash flows for the reported periods [Condensed Consolidated Balance Sheets](index=11&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The condensed consolidated balance sheets as of July 3, 2022, and January 2, 2022, show a slight increase in total assets, a significant rise in total liabilities, and a substantial decrease in total equity attributable to the company Condensed Consolidated Balance Sheets (Selected) | (In thousands) | July 3, 2022 | January 2, 2022 | | :------------- | :----------- | :-------------- | | Total current assets | $606,908 thousand | $533,120 thousand | | Total assets | $1,081,062 thousand | $1,056,543 thousand | | Total current liabilities | $544,725 thousand | $421,036 thousand | | Total liabilities | $912,551 thousand | $701,668 thousand | | Equity attributable to the Company | $163,086 thousand | $349,456 thousand | | Total equity | $168,511 thousand | $354,875 thousand | - Cash and cash equivalents decreased to **$138,347 thousand** as of July 3, 2022, from **$166,542 thousand** on January 2, 2022[24](index=24&type=chunk) - Inventory increased to **$282,440 thousand** as of July 3, 2022, from **$212,820 thousand** on January 2, 2022[24](index=24&type=chunk) [Condensed Consolidated Statements of Operations](index=13&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The company reported **$238,080 thousand** in revenue for Q2 2022, with expanded gross and net losses; revenue grew year-over-year, but losses significantly increased, resulting in a basic and diluted net loss per share of **$2.15** Condensed Consolidated Statements of Operations (Selected) | (In thousands, except per share data) | Three Months Ended July 3, 2022 | Three Months Ended July 4, 2021 | Six Months Ended July 3, 2022 | Six Months Ended July 4, 2021 | | :------------------------------------ | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | Revenue | $238,080 thousand | $175,895 thousand | $461,161 thousand | $341,312 thousand | | Gross loss | $(39,324) thousand | $(2,812) thousand | $(52,288) thousand | $(1,761) thousand | | Operating expenses | $35,701 thousand | $38,069 thousand | $73,111 thousand | $75,276 thousand | | Operating loss | $(75,025) thousand | $(40,881) thousand | $(125,399) thousand | $(77,037) thousand | | Net loss attributable to the stockholders | $(87,920) thousand | $(77,011) thousand | $(147,032) thousand | $(115,825) thousand | | Basic Net loss per share | $(2.15) | $(1.99) | $(3.61) | $(3.36) | - Q2 2022 revenue increased by **35.35%** year-over-year, from **$175,895 thousand** to **$238,080 thousand**[27](index=27&type=chunk) - Q2 2022 gross loss expanded to **$39,324 thousand** from **$2,812 thousand** in the same period of 2021[27](index=27&type=chunk) [Condensed Consolidated Statements of Equity](index=14&type=section&id=Condensed%20Consolidated%20Statements%20of%20Equity) The condensed consolidated statements of equity show total equity attributable to the company significantly decreased to **$163,086 thousand** as of July 3, 2022, from **$349,456 thousand** on January 2, 2022, primarily due to net loss and ASU 2020-06 adoption Condensed Consolidated Statements of Equity (Selected) | (In thousands) | Balance at January 2, 2022 | Net loss (Q1 2022) | Effect of adoption of ASU 2020-06 | Balance at April 3, 2022 | Net (loss) income (Q2 2022) | Balance at July 3, 2022 | | :------------- | :------------------------- | :----------------- | :-------------------------------- | :----------------------- | :-------------------------- | :---------------------- | | Additional Paid In Capital | $624,261 thousand | $— thousand | $(52,189) thousand | $573,536 thousand | $2,823 thousand | $576,359 thousand | | Accumulated Deficit | $(262,961) thousand | $(59,112) thousand | $10,122 thousand | $(311,951) thousand | $(87,920) thousand | $(399,871) thousand | | Accumulated Other Comprehensive Loss | $(11,844) thousand | $— thousand | $— thousand | $(12,647) thousand | $(755) thousand | $(13,402) thousand | | Equity Attributable to the Company | $349,456 thousand | $(59,112) thousand | $(42,067) thousand | $248,938 thousand | $(87,920) thousand | $163,086 thousand | | Total Equity | $354,875 thousand | $(59,197) thousand | $(42,067) thousand | $254,208 thousand | $(87,765) thousand | $168,511 thousand | - Accumulated deficit increased to **$399,871 thousand** as of July 3, 2022, from **$262,961 thousand** on January 2, 2022[29](index=29&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=16&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended July 3, 2022, cash flow from operating activities turned into a net inflow of **$3,698 thousand** from a net outflow of **$17,878 thousand** in the prior year, with reduced investing and financing outflows leading to a decrease in total period-end cash Condensed Consolidated Statements of Cash Flows (Selected) | (In thousands) | Six Months Ended July 3, 2022 | Six Months Ended July 4, 2021 | | :------------- | :---------------------------- | :---------------------------- | | Net cash provided by (used in) operating activities | $3,698 thousand | $(17,878) thousand | | Net cash used in investing activities | $(39,881) thousand | $(62,809) thousand | | Net cash provided by financing activities | $23,941 thousand | $142,830 thousand | | Net (decrease) increase in cash, cash equivalents and restricted cash | $(12,082) thousand | $62,169 thousand | | Cash, cash equivalents and restricted cash, end of period | $180,150 thousand | $271,741 thousand | - Net cash from operating activities shifted from an outflow of **$17,878 thousand** in the prior year to an inflow of **$3,698 thousand** for the six months ended July 3, 2022[33](index=33&type=chunk) - Net cash used in investing activities decreased to **$39,881 thousand** for the six months ended July 3, 2022, from **$62,809 thousand** in the prior year[33](index=33&type=chunk)

Financial Data and Key Metrics Changes - First quarter shipments were 488 megawatts, representing a year-over-year increase of over 25% and reaching the high end of guidance [48][49] - Total revenues increased slightly to $223 million sequentially and grew by more than 35% year-on-year, primarily due to volume increases and price hikes in DG markets [51][52] - Gross loss for the quarter was $13 million, largely due to losses on opportunistic sales of excess polysilicon supply [53][60] - Adjusted EBITDA for the first quarter was negative $33.6 million, reflecting challenges from polysilicon sales and factory underutilization [60][73] Business Line Data and Key Metrics Changes - European DG sales volumes exceeded U.S. DG volumes, with revenue up more than 75% year-on-year [13] - In Italy, DG market share increased to over 25% in Q1 2022, up from the low 20s in 2021 [13] - The U.S. Utility-Scale business is expected to achieve price premiums due to technology and customer focus, with gross margins projected to reach 50% at stable state [63][64] Market Data and Key Metrics Changes - Strong demand in Europe and Australia, particularly in the Netherlands, is driving growth in the solar industry [12][14] - The U.S. market is seeing increased demand for premium solar panels, especially following the exit of LG from the market [16][91] - Supply chain costs have significantly impacted margins, with polysilicon and freight rates at historical highs [57][70] Company Strategy and Development Direction - The company is focused on expanding its differentiated panel technology and enhancing its downstream channel strategy [29][30] - Maxeon is preparing for potential expansion in the U.S. and is evaluating options for increasing capacity beyond the current 1.8 gigawatts [27][28] - The introduction of the SunPower One integrated home energy solution is a key strategic initiative aimed at enhancing customer engagement and expanding product offerings [33][34] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to profitability by 2023, driven by improved capacity utilization and pricing adjustments [46][81] - The company is optimistic about the potential passage of SEMA legislation, which could enhance U.S. manufacturing capabilities [89][90] - Management highlighted the importance of customer engagement, noting that cumulative customer count surpassed 1 million in Q1 2022 [82][83] Other Important Information - The company is undergoing a transformation to enhance operational efficiency and product offerings, with a focus on the Maxeon 7 technology rollout [32][74] - Supply chain disruptions and geopolitical events have posed challenges, but the company is managing these through strategic pricing and operational adjustments [44][45] Q&A Session Summary Question: Revenue growth in DG segment and distribution partner announcement - Management indicated that existing capacity and the scaling of Maxeon 6 will contribute to increased volumes, with a focus on the U.S. market due to competitive dynamics [87] Question: Update on SEMA legislation and operational positioning - Management is closely monitoring SEMA legislation and is prepared for expansion in the U.S. or alternative locations if necessary [89][90] Question: Margin outlook beyond Q2 - Management expects the second half of the year to show improved margins, with positive EBITDA anticipated in the DG segment by Q4 [96][98] Question: Structure of contracts and pricing strategies - Management is negotiating contracts with a mix of fixed and variable pricing based on indices to share risk with customers [100][101] Question: Volume expectations with CED contract - Management anticipates significant growth from the CED partnership, leveraging the demand for premium panels [105]

| --- | --- | --- | --- | |--------------------------------------------------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1Q 2022 RESULTS SUPPLEMENTAL SLIDES MAY 26, 2022 | | | | | | | | | 1 | © 2021 Maxeon Solar Technologies SAFE HARBOR STATEMENT This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding: (a) our expectations regarding pricing ...

[Q1 2022 Financial Results Overview](index=1&type=section&id=Maxeon%20Solar%20Technologies%20Announces%20First%20Quarter%202022%20Financial%20Results) [Management Commentary](index=1&type=section&id=Management%20Commentary) The CEO highlighted record performance in European Distributed Generation (DG), with module sales up over 75% year-over-year, and the successful first delivery of US Utility-Scale shipments, focusing on ramping Maxeon 6 and Performance line production to achieve profitability in 2023 despite ongoing supply chain challenges - Record DG performance in Europe with module sales up over **75% year-over-year** and the launch of the SunPower One ecosystem[2](index=2&type=chunk) - First US Utility-Scale module shipments were successfully delivered from Mexico facilities, with negotiations underway for 2024 deliveries[2](index=2&type=chunk) - The company's key strategic focus is on ramping up Maxeon 6 (to **500MW in H2 2022**) and Performance line capacity for the US market (fully ramped in H1 2023) to drive a return to profitability in 2023[3](index=3&type=chunk) [Q1 2022 Financial Highlights](index=1&type=section&id=Selected%20Q1%20Unaudited%20Financial%20Summary) In Q1 2022, Maxeon reported revenue of **$223.1 million**, a slight increase from Q4 2021 and a significant increase from Q1 2021, recording a GAAP Net Loss of **$59.1 million** and an Adjusted EBITDA of **-$33.6 million**, while shipments decreased quarter-over-quarter but increased year-over-year Selected Q1 2022 Unaudited Financial Summary | (In thousands, except shipments) | Fiscal Q1 2022 | Fiscal Q4 2021 | Fiscal Q1 2021 | | :--- | :--- | :--- | :--- | | **Shipments, in MW** | 488 | 577 | 379 | | **Revenue** | $223,081 | $221,479 | $165,417 | | **GAAP Gross (loss) profit** | $(12,964) | $(10,545) | $1,051 | | **GAAP Net loss attributable to the stockholders** | $(59,112) | $(73,332) | $(38,814) | | **Capital expenditures** | $21,682 | $37,393 | $10,958 | Other Financial Data (Non-GAAP & Adjusted EBITDA) | (In thousands) | Fiscal Q1 2022 | Fiscal Q4 2021 | Fiscal Q1 2021 | | :--- | :--- | :--- | :--- | | **Non-GAAP Gross (loss) profit** | $(12,542) | $(10,056) | $1,274 | | **Adjusted EBITDA** | $(33,590) | $(32,777) | $(23,520) | [Financial Outlook](index=3&type=section&id=Financial%20Outlook) [Second Quarter 2022 Guidance](index=3&type=section&id=Second%20Quarter%202022%20Outlook) For Q2 2022, the company projects revenue between **$215 million** and **$230 million**, with shipments expected to be in the range of **460 to 490 MW**, anticipating an Adjusted EBITDA loss of **$37 million** to **$47 million** and capital expenditures projected at **$20 million** to **$24 million** Q2 2022 Outlook | (In millions, except shipments) | Outlook | | :--- | :--- | | **Shipments, in MW** | 460 - 490 MW | | **Revenue** | $215 - $230 | | **Gross loss** | $15 - $25 | | **Non-GAAP gross loss** | $15 - $25 | | **Adjusted EBITDA** | $(37) - $(47) | | **Capital expenditures** | $20 - $24 | - Capital expenditures are primarily directed towards upgrading production to Maxeon 6 in Malaysia, purchasing equipment for the Performance line in the U.S., and developing Maxeon 7 technology[8](index=8&type=chunk) [Consolidated Financial Statements (Unaudited)](index=11&type=section&id=Consolidated%20Financial%20Statements%20(unaudited)) [Condensed Consolidated Balance Sheets](index=11&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) As of April 3, 2022, Maxeon's total assets were approximately **$1.1 billion**, up from **$1.06 billion** at the start of the quarter, while total liabilities increased significantly to **$845.6 million** from **$701.7 million**, primarily due to increases in convertible and short-term debt, consequently decreasing total equity from **$354.9 million** to **$254.2 million** Key Balance Sheet Items (As of April 3, 2022 vs. January 2, 2022) | (In thousands) | April 3, 2022 | January 2, 2022 | | :--- | :--- | :--- | | **Total current assets** | $604,005 | $533,120 | | **Total assets** | $1,099,807 | $1,056,543 | | **Total current liabilities** | $452,976 | $421,036 | | **Total liabilities** | $845,599 | $701,668 | | **Total equity** | $254,208 | $354,875 | [Condensed Consolidated Statements of Operations](index=13&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) For the first quarter ended April 3, 2022, the company generated revenue of **$223.1 million**, an increase from **$165.4 million** in the same period last year, though the gross loss widened to **$13.0 million** from a gross profit of **$1.1 million** year-over-year, and the net loss attributable to stockholders increased to **$59.1 million**, or **($1.45) per share**, compared to a net loss of **$38.8 million**, or **($1.14) per share**, in Q1 2021 Q1 2022 vs Q1 2021 Statement of Operations Highlights | (In thousands, except per share data) | Three Months Ended April 3, 2022 | Three Months Ended April 4, 2021 | | :--- | :--- | :--- | | **Revenue** | $223,081 | $165,417 | | **Gross (loss) profit** | $(12,964) | $1,051 | | **Operating loss** | $(50,374) | $(36,156) | | **Net loss attributable to the stockholders** | $(59,112) | $(38,814) | | **Net loss per share (Basic & Diluted)** | $(1.45) | $(1.14) | [Condensed Consolidated Statements of Equity](index=14&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20EQUITY) Total equity decreased from **$354.9 million** at the beginning of the period to **$254.2 million** as of April 3, 2022, primarily driven by the net loss of **$59.1 million** and a **$42.1 million** reduction from the adoption of accounting standard ASU 2020-06 - Total equity decreased from **$354.9 million** on January 2, 2022, to **$254.2 million** on April 3, 2022[31](index=31&type=chunk) - The primary drivers for the equity decrease were a net loss of **$59.1 million** and a **$42.1 million** reduction from the adoption of accounting standard ASU 2020-06[31](index=31&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=16&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) In Q1 2022, net cash provided by operating activities was **$14.7 million**, a significant improvement from the **$50.8 million** used in Q1 2021, with net cash used in investing activities at **$21.7 million** mainly for property and equipment purchases, and net cash provided by financing activities at **$22.5 million**, ending the quarter with **$176.7 million** in cash and cash equivalents Summary of Cash Flows (Three Months Ended) | (In thousands) | April 3, 2022 | April 4, 2021 | | :--- | :--- | :--- | | **Net cash provided by (used in) operating activities** | $14,685 | $(50,823) | | **Net cash used in investing activities** | $(21,693) | $(10,958) | | **Net cash provided by (used in) financing activities** | $22,476 | $(15,463) | | **Net increase (decrease) in cash, cash equivalents and restricted cash** | $15,532 | $(77,139) | | **Cash, cash equivalents and restricted cash, end of period** | $207,764 | $132,433 | [Supplementary Information and Non-GAAP Measures](index=3&type=section&id=Supplementary%20Information%20and%20Non-GAAP%20Measures) [Supplementary Information Affecting GAAP and Non-GAAP Results](index=3&type=section&id=Supplementary%20information%20affecting%20GAAP%20and%20Non-GAAP%20results) The company's cost of revenue was significantly impacted by polysilicon-related costs, including a **$7.4 million** incremental cost for above-market polysilicon contracts and an **$8.3 million** loss on ancillary sales of excess polysilicon in Q1 2022 Polysilicon Impact on Cost of Revenue (In thousands) | Item | April 3, 2022 | January 2, 2022 | April 4, 2021 | | :--- | :--- | :--- | :--- | | **Incremental cost of above market polysilicon** | $7,388 | $11,542 | $11,618 | | **Loss on ancillary sales of excess polysilicon** | $8,328 | $2,621 | $1,720 | [Use of Non-GAAP Financial Measures](index=8&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures) Maxeon uses non-GAAP measures such as non-GAAP gross profit, non-GAAP operating expenses, and Adjusted EBITDA to enhance transparency into its ongoing operating performance by excluding non-core operational items - The company uses non-GAAP measures to enhance comparability across reporting periods and with competitors by removing items not associated with core operations[19](index=19&type=chunk) - Key adjustments to arrive at non-GAAP figures include stock-based compensation, restructuring charges, remeasurement loss/gain on prepaid forward, impairment, and equity in losses of unconsolidated investees[20](index=20&type=chunk)[22](index=22&type=chunk) [Reconciliation of Non-GAAP Financial Measures](index=10&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures) The company provides a detailed reconciliation from GAAP to non-GAAP figures, where the Q1 2022 GAAP Net Loss of **$59.1 million** was reconciled to an Adjusted EBITDA of **-$33.6 million** through adjustments for depreciation, interest, taxes, and other non-cash or non-core operational items Reconciliation of GAAP Net Loss to Adjusted EBITDA (Q1 2022, in thousands) | Line Item | Amount | | :--- | :--- | | **GAAP Net loss attributable to the stockholders** | $(59,112) | | Interest expense, net | $4,786 | | Provision for income taxes | $825 | | Depreciation | $12,898 | | Amortization | $90 | | **EBITDA** | **$(40,513)** | | Stock-based compensation | $2,697 | | Restructuring charges (credits) and fees | $768 | | Remeasurement loss (gain) on prepaid forward | $397 | | Equity in losses of unconsolidated investees | $3,061 | | **Adjusted EBITDA** | **$(33,590)** | [Other Information](index=5&type=section&id=Other%20Information) [Forward-Looking Statements](index=5&type=section&id=Forward-Looking%20Statements) The press release contains forward-looking statements regarding pricing, demand, product launches, strategic plans, and financial guidance, which are subject to substantial risks and uncertainties including supply chain disruptions, competition, and regulatory changes - The report includes forward-looking statements concerning future performance, strategy, product ramps (Maxeon 6, 7, Performance line), and Q2 2022 guidance[13](index=13&type=chunk)[14](index=14&type=chunk) - These statements are subject to significant risks and uncertainties, and readers are cautioned not to place undue reliance on them; a detailed discussion of risk factors is available in the company's SEC filings[16](index=16&type=chunk) [Conference Call Information](index=5&type=section&id=Conference%20Call%20Details) The company scheduled a conference call for May 26, 2022, to discuss the first quarter 2022 financial results and provide a business update, with dial-in details and webcast information provided for interested parties - A conference call to discuss Q1 2022 results was scheduled for May 26, 2022, at 5:30 PM U.S. ET[11](index=11&type=chunk)

4Q 2021 RESULTS SUPPLEMENTAL SLIDES March 24, 2022 © 2022 Maxeon Solar Technologies SAFE HARBOR STATEMENT This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding: (a) our expectations regarding pricing trends, demand and growth projections; (b) potential disruptions to our operations and supply chain that may result from epidemics, natural disasters or military conflicts, including t ...