Company Overview and Q2 2025 Highlights SolarEdge reported Q2 2025 results, highlighting steady progress with revenue growth and margin expansion [Introduction and CEO Statement](index=1&type=section&id=Introduction%20and%20CEO%20Statement) CEO Shuki Nir highlighted SolarEdge's second consecutive quarter of revenue growth and margin expansion - SolarEdge achieved its **second consecutive quarter of year-over-year and sequential revenue growth**[3](index=3&type=chunk) - The company also experienced **margin expansion** during the quarter[3](index=3&type=chunk) [Second Quarter 2025 Financial Summary (GAAP & Non-GAAP)](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Summary%20%28GAAP%20%26%20Non-GAAP%29) SolarEdge reported sequential revenue and gross margin growth, reduced non-GAAP losses, while GAAP losses increased and cash flow turned negative [Revenue and Shipments](index=1&type=section&id=Revenue%20and%20Shipments) Q2 2025 revenues showed strong sequential increases for both GAAP and Non-GAAP, with substantial inverter and battery shipments Q2 2025 Revenue Performance (Millions) | Metric | Q2 2025 | Prior Quarter | Sequential Change | | :----- | :------ | :------------ | :---------------- | | GAAP Revenues | $289.41 | $219.51 | +32% | | Non-GAAP Revenues | $281.0 | $212.1 | +32% | - The Company shipped **1,194 MW (AC) of inverters** and **247 MWh of batteries** for PV applications in Q2 2025[5](index=5&type=chunk) [Margins and Expenses](index=1&type=section&id=Margins%20and%20Expenses) Gross margins improved sequentially in Q2 2025 for both GAAP and Non-GAAP, despite tariff impact, while GAAP operating expenses increased Q2 2025 Gross Margin and Operating Expenses | Metric | Q2 2025 | Prior Quarter | Sequential Change | | :----- | :------ | :------------ | :---------------- | | GAAP Gross Margin | 11.1% | 8.0% | +3.1 pp | | Non-GAAP Gross Margin | 13.1% | 7.8% | +5.3 pp | | GAAP Operating Expenses (Millions) | $147.61 | $120.31 | +$27.3 | | Non-GAAP Operating Expenses (Millions) | $85.2 | $89.1 | -$3.9 | - New tariffs had a **negative impact of approximately 1% on gross margin** in the second quarter[6](index=6&type=chunk) [Operating and Net Loss](index=1&type=section&id=Operating%20and%20Net%20Loss) GAAP operating and net losses increased in Q2 2025, while Non-GAAP operating and net losses significantly narrowed Q2 2025 Operating and Net Loss (Millions) | Metric | Q2 2025 | Prior Quarter | Sequential Change | | :----- | :------ | :------------ | :---------------- | | GAAP Operating Loss | $(115.51) | $(102.71) | $(12.8) | | Non-GAAP Operating Loss | $(48.3) | $(72.4) | +$24.1 | | GAAP Net Loss | $(124.71) | $(98.51) | $(26.2) | | Non-GAAP Net Loss | $(47.7) | $(66.1) | +$18.4 | | GAAP Net Loss per Share | $(2.13) | $(1.70) | $(0.43) | | Non-GAAP Net Loss per Share | $(0.81) | $(1.14) | +$0.33 | [Cash Flow and Liquidity](index=2&type=section&id=Cash%20Flow%20and%20Liquidity) Operating and free cash flow turned negative in Q2 2025, but net cash and investments portfolio increased from year-end 2024 Q2 2025 Cash Flow Summary (Millions) | Metric | Q2 2025 | Prior Quarter | Sequential Change | | :----- | :------ | :------------ | :---------------- | | Cash used in operating activities | $(7.8) | $33.8 (provided) | $(41.6) | | Free cash flow used | $(9.1) | $19.8 (generated) | $(28.9) | - As of June 30, 2025, the cash and investments portfolio, net of debt, totaled **$131.8 million**, an increase of **$18.6 million** from $113.2 million as of December 31, 2024[12](index=12&type=chunk) [Outlook for Third Quarter 2025](index=2&type=section&id=Outlook%20for%20Third%20Quarter%202025) SolarEdge projects continued revenue growth and improved non-GAAP gross margin for Q3 2025, with stable non-GAAP operating expenses Q3 2025 Financial Guidance | Metric | Guidance Range | Notes | | :----- | :------------- | :---- | | Revenues (Millions) | $315 to $355 | | | Non-GAAP Gross Margin (%) | 15 to 19 | Includes approximately 2% of new tariff impact | | Non-GAAP Operating Expenses (Millions) | $85 to $90 | | [Conference Call Information](index=2&type=section&id=Conference%20Call%20Information) SolarEdge scheduled a conference call for August 7, 2025, to discuss Q2 2025 results, with live access and webcast replay details - A conference call to discuss Q2 2025 results was scheduled for **8:00 a.m. ET on Thursday, August 7, 2025**[14](index=14&type=chunk) - Interested parties could join by dialing **+1 833-316-1983 (domestic)** or **+1 785-838-9310 (international)**, using Conference ID SEDG[14](index=14&type=chunk) - A live webcast and replay would be available in the **Investor Relations section of the Company's website**[14](index=14&type=chunk) [About SolarEdge](index=3&type=section&id=About%20SolarEdge) SolarEdge is a global leader in smart energy technology, providing intelligent inverter solutions and a broad range of smart energy offerings - SolarEdge is a **global leader in smart energy technology**, leveraging world-class engineering and innovation[17](index=17&type=chunk) - The company developed an **intelligent inverter solution for photovoltaic (PV) systems** to maximize power generation and lower energy costs[17](index=17&type=chunk) - SolarEdge addresses various energy market segments with solutions for **PV, storage, EV charging, batteries, and grid services**[17](index=17&type=chunk) [Use of Non-GAAP Financial Measures](index=3&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures) SolarEdge uses non-GAAP measures to provide additional insights into operating results by excluding certain non-recurring or non-cash items - Non-GAAP measures exclude items such as **stock-based compensation, amortization and impairment of acquired intangible assets, restructuring and impairment charges, and certain litigation expenses**[18](index=18&type=chunk) - Management uses non-GAAP measures for **internal budgeting, forecasting, evaluating financial performance, and comparing operating results across periods**[19](index=19&type=chunk) - These non-GAAP measures have limitations and should be considered **in addition to, not as a substitute for, GAAP measures**, and may not be comparable to those of other companies[20](index=20&type=chunk) [Safe Harbor Statement](index=4&type=section&id=Safe%20Harbor%20Statement) The press release contains forward-looking statements subject to known and unknown risks and uncertainties, with no obligation for updates - The press release includes **forward-looking statements** regarding future results, business strategies, technology developments, and economic conditions[21](index=21&type=chunk) - These statements are subject to **known and unknown risks and uncertainties**, including demand for renewable energy, ability to forecast demand, changes in tax laws, trade environment, and macroeconomic conditions[22](index=22&type=chunk) - Readers should not place **undue reliance on forward-looking statements**, and the company does not undertake to update them[22](index=22&type=chunk) [Investor Contacts](index=4&type=section&id=Investor%20Contacts) Contact information for SolarEdge's Investor Relations department and Sapphire Investor Relations, LLC is provided for inquiries - **JB Lowe** is the Head of Investor Relations for SolarEdge Technologies, Inc[24](index=24&type=chunk) - **Erica Mannion or Michael Funari** from Sapphire Investor Relations, LLC can also be contacted[24](index=24&type=chunk) - All investor inquiries can be directed to **investors@solaredge.com**[24](index=24&type=chunk) [Condensed Consolidated Financial Statements (GAAP)](index=6&type=section&id=Condensed%20Consolidated%20Financial%20Statements%20%28GAAP%29) This section presents SolarEdge's GAAP financial statements, including statements of loss, balance sheets, and cash flows [Condensed Consolidated Statements of Loss](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Loss) GAAP statements show a net loss of $(124,744) thousand for Q2 2025, an increase from the prior year, despite higher revenues Condensed Consolidated Statements of Loss (GAAP, in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------ | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Revenues | $289,429 | $265,405 | $508,909 | $469,804 | | Cost of revenues | 257,298 | 276,374 | 459,242 | 506,960

Core Insights - SolarEdge Technologies and Enphase Energy have lost their significant post-pandemic gains, with SolarEdge underperforming compared to the S&P 500 Index and the iShares Global Clean Energy ETF [1] Company Performance - SolarEdge Technologies is currently underperforming relative to both the S&P 500 Index and the iShares Global Clean Energy ETF, indicating a decline in market performance [1] Market Context - The decline in performance for both SolarEdge and Enphase Energy suggests a broader trend affecting clean energy stocks post-pandemic, reflecting potential shifts in investor sentiment or market conditions [1]

Core Insights - SolarEdge Technologies (SEDG) experienced a stock decline of 7.8% in the most recent trading session, underperforming compared to the S&P 500, which fell by 0.3% [1] - Over the past month, the company's shares have increased by 32.65%, significantly outperforming the Oils-Energy sector's gain of 3.2% and the S&P 500's gain of 3.64% [1] Earnings Expectations - The upcoming earnings report for SolarEdge Technologies is scheduled for August 7, 2025, with an expected EPS of -$0.82, reflecting a 54.19% increase from the same quarter last year [2] - The consensus estimate for quarterly revenue is projected at $273.71 million, which is a 3.13% increase compared to the previous year [2] Full Year Projections - For the full year, the Zacks Consensus Estimates predict an EPS of -$3.29 and revenue of $1.1 billion, indicating changes of +85.69% and +18.25% respectively from the prior year [3] Analyst Estimates and Market Sentiment - Changes in analyst estimates for SolarEdge Technologies are crucial as they reflect short-term business trends and analysts' confidence in the company's performance [4] - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), indicates a current rank of 3 (Hold) for SolarEdge Technologies, with a recent consensus EPS projection moving 1.21% lower [6] Industry Context - The solar industry, part of the Oils-Energy sector, holds a Zacks Industry Rank of 85, placing it in the top 35% of over 250 industries [7] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1, highlighting the competitive strength of the solar industry [7]

Group 1 - First Solar (FSLR) stock price increase narrowed to 4.5% [1] - Daqo New Energy ADR currently up 7.6%, SolarEdge up 4.2%, Clean Energy ETF QCLN up 2.4%, and Canadian Solar ADR up 1.6% [1] - U.S. solar manufacturers have filed anti-dumping and countervailing duty petitions against three Asian countries: India, Indonesia, and Laos [1]

Core Viewpoint - Morgan Stanley has adjusted ratings for several U.S. solar stocks due to market and policy changes, downgrading Enphase Energy and SolarEdge Technologies to "Neutral" while favoring Sunrun as a preferred stock [1][2]. Group 1: Enphase Energy - Morgan Stanley downgraded Enphase Energy's rating from "Overweight" to "Neutral" and reduced the target price from $64 to $37, reflecting downward pressure on stock prices and profit margins due to the industry's shift towards third-party systems [1]. - Despite the downgrade, the firm believes that Enphase remains one of the few consistently profitable solar companies with a net cash position [1]. - Analyst Mark Strouse noted that the recent "Inflation Reduction Act" may lead to a lack of positive momentum in the U.S. residential solar market, potentially impacting Enphase's market share and gross margins [1]. Group 2: SolarEdge Technologies - SolarEdge Technologies' rating was also downgraded from "Overweight" to "Neutral," with a target price set at $23, following a 34% increase in the stock's performance this month [2]. - Strouse maintains that SolarEdge holds a relatively favorable position in the U.S. residential inverter market, as the residential solar sector shifts towards third-party ownership models [2]. - New foreign entity regulatory frameworks have reduced competitive pressure in the market [2]. Group 3: Sunrun - Morgan Stanley is optimistic about Sunrun, assigning it an "Overweight" rating and raising the target price from $13 to $16, due to improved visibility in solar leasing and power purchase agreements [2]. - Sunrun is expected to meet the 48E tax credit eligibility by the end of 2027 and continue to benefit from storage incentives until the end of 2032 [2].

Company Performance - SolarEdge Technologies (SEDG) ended the recent trading session at $27.57, demonstrating a +1.77% change from the preceding day's closing price, outpacing the S&P 500's 0.28% gain [1] - Prior to today's trading, shares of SolarEdge had gained 30.05%, significantly outperforming the Oils-Energy sector's gain of 4.96% and the S&P 500's gain of 4.37% [1] Upcoming Earnings - SolarEdge is anticipated to report an EPS of -$0.81, marking a 54.75% rise compared to the same quarter of the previous year [2] - The Zacks Consensus Estimate for revenue is projecting net sales of $274.47 million, up 3.42% from the year-ago period [2] Annual Forecast - For the entire year, the Zacks Consensus Estimates forecast earnings of -$3.25 per share and revenue of $1.09 billion, indicating changes of +85.86% and +17.55%, respectively, compared to the previous year [3] Analyst Estimates - Recent changes in analyst estimates for SolarEdge Technologies are important as they signify the changing landscape of near-term business trends [4] - Positive revisions in estimates convey analysts' confidence in the business performance and profit potential [4] Zacks Rank System - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), has a proven track record of outperformance, with 1 stocks returning an average of +25% annually since 1988 [6] - Within the past 30 days, the consensus EPS projection for SolarEdge has moved 0.07% higher, and the company currently holds a Zacks Rank of 2 (Buy) [6] Industry Overview - The Solar industry is part of the Oils-Energy sector and currently carries a Zacks Industry Rank of 51, placing it within the top 21% of over 250 industries [7] - The Zacks Industry Rank assesses the strength of industry groups by calculating the average Zacks Rank of the individual stocks within those groups [7]

Group 1 - U.S. stock futures showed mixed results, with Dow futures decreasing by approximately 0.1% [1] - Helius Medical Technologies, Inc. (HSDT) experienced a significant pre-market decline, with shares dropping 10.9% to $8.42 following a $25 million share offering prospectus filing [1] - Blue Gold Limited (BGL) shares fell 15.6% to $63.00 in pre-market trading after a 30% drop on Monday [3] Group 2 - Pelthos Therapeutics Inc. (PTHS) shares decreased by 8.3% to $23.79 after a substantial gain of 60% on Monday [3] - AirJoule Technologies Corp (AIRJ) shares fell 5.8% to $4.82 in pre-market trading [3] - Aebi Schmidt Holding (AEBI) shares dipped 5.2% to $11.50 after a decline of over 10% on Monday [3] Group 3 - SolarEdge Technologies, Inc. (SEDG) shares declined 5.1% to $25.08 after a 4% drop on Monday, despite an upgrade from Keybanc analyst Sophie Karp from Underweight to Sector Weight [3] - Sunrun Inc. (RUN) shares slipped 4.8% to $10.58 after gaining more than 5% on Monday, also receiving an upgrade from Keybanc analyst Sophie Karp from Underweight to Sector Weight [3] - Shoals Technologies Group Inc (SHLS) shares fell 4% to $6.05 after a 5% gain on Monday [3]

Core Viewpoint - The Republican Party has canceled the consumption tax on wind and solar projects at the last moment, leading to a significant rise in U.S. solar stocks. However, concerns remain regarding the potential increase in costs for renewable energy developers due to reliance on foreign components and supply chains dominated by China [1][2]. Group 1: Tax Legislation Impact - The latest tax and spending bill passed by the U.S. Senate includes a gradual phase-out of tax credits for solar and wind energy starting in 2026, with complete elimination by 2028. Projects must be operational by the end of 2027 to qualify for tax credits [2]. - The bill allows nuclear tax credits to continue until 2036, while hydrogen tax credits will be eliminated by 2028 [2]. Group 2: Industry Reactions - The President of the Solar Energy Industries Association expressed concerns that the bill undermines the recovery of U.S. manufacturing and the country's global energy leadership, predicting higher electricity costs for households and potential job losses [2]. - Some U.S. manufacturers support the proposed tax changes, emphasizing the need to reduce dependence on China's clean energy supply chain [1]. Group 3: Legislative Challenges - The bill, known as the "Big and Beautiful Act," passed the Senate with a narrow margin of 51 to 50 but faces significant challenges in the House of Representatives due to concerns from some Republican lawmakers about its impact on the federal deficit [2]. - The Congressional Budget Office estimates that the bill could increase the federal deficit by at least $3 trillion over the next decade [2].

Group 1 - The U.S. Senate passed President Trump's latest tax and spending bill, which removed consumption taxes on wind and solar projects, leading to a significant rise in solar stocks [1] - Solar stocks such as Shoals Technologies (SHLS.US) increased nearly 24%, Array Technologies (ARRY.US) rose nearly 13%, and Sunrun (RUN.US) gained nearly 11% following the news [1] - The bill mandates a gradual phase-out of solar and wind tax credits starting in 2026, with a complete elimination by 2028, while nuclear tax credits will last until 2036 [1] Group 2 - The American Solar Industry Association expressed concerns that the bill undermines U.S. manufacturing recovery and energy leadership, potentially leading to higher electricity costs and job losses [2] - The bill passed the Senate with a narrow margin of 51 to 50 but faces challenges in the House due to concerns over its impact on the federal deficit, estimated to increase by at least $3 trillion over the next decade [2]

Group 1: Hong Kong Stocks - Lehua Entertainment (02306) surged over 24% due to strong market performance of its toy IP "WUKUKU," with multiple new products setting sales records and the theme song exceeding 1 billion views [1] - United Energy Group (00467) rose over 7% after signing a 15-year production increase contract with Uzbekistan's UNG, involving 57.8 billion cubic meters of oil and gas production, with an initial investment of $100 million to expand into Central Asia [1] - Smoore International (06969) fell over 3% as shareholder Yiwei Lithium Energy plans to reduce its stake by 3.5% (216 million shares), resulting in a decrease of its holding to 27.23%, no longer being the controlling shareholder [1] - New World Development (00200) dropped over 5% after completing a "2 for 1" rights issue, issuing 758 million shares and raising HKD 771 million, with oversubscription of 13 times [1] - Fourth Paradigm (06682) increased over 7% after launching AI solutions for the manufacturing industry, covering production optimization to supply chain intelligence upgrades [1] - Shandong High-Tech Holdings (00412) rose over 4% as Zhongtai Securities highlighted significant synergy between its new energy and digital infrastructure, with a data center PUE value of 1.15, enhancing financial integration [1] - KANAT Optical (02276) increased over 4% due to an explosion in the smart glasses market (e-commerce transactions up 8 times), with Meta collaborating with Oakley to launch AI glasses, positioning the company with leading 3C enterprises [1] Group 2: Other Notable Stocks - Sipai Health (00314) rose over 7% after partnering with Anruijiaer to develop customized insurance, planning to sell 6 pharmacies for 5.89 million to focus on core medical insurance business [2] - SF Express (09699) increased over 5% after raising its delivery service revenue cap for 2025/26 to HKD 12.8 billion / HKD 20.5 billion, with demand growth exceeding expectations [2] - Liufu Group (00590) fell over 3% as it projected a 40% decline in profits for the 2025 fiscal year, primarily due to gold hedging losses and high base effects from acquisition gains [2] - Zhenjiu Lidu (06979) rose over 4% after announcing Yao Annan as the "Cultural Heritage Ambassador" for liquor, leveraging Huawei-related topics to boost brand visibility [2] - Ideal Auto-W (02015) dropped over 4% as Meituan's Wang Xing sold 5.73 million shares for HKD 600 million, reducing his stake to 20.61% [2] - Health Road (02587) surged over 7% as its liver disease AI management platform was selected for Beijing's digital medical verification program, supporting WHO's "2030 Hepatitis Elimination" goal [2] - Gilead Sciences-B (01672) rose over 5% after its psoriasis oral drug ASC50 completed the first dosing in Phase I clinical trials in the U.S., targeting the IL-17 pathway [2] - China Silver Group (00815) increased over 10% after partnering with Zefeng Gold to acquire a 55% stake in a lead-zinc exploration company, gaining exploration rights over 50.8 square kilometers in Tibet [2] Group 3: U.S. Stocks - Verve Therapeutics (VERV.US) skyrocketed over 80% as Eli Lilly prepares to acquire the gene-editing company for up to $1.3 billion, with $1 billion as an upfront payment and $300 million contingent on specific clinical milestones [4] - Solar energy stocks plummeted, with Sunrun (RUN.US) down over 40%, Solaredge Technologies (SEDG.US) down over 41%, and First Solar (FSLR.US) down over 22%, following a Republican proposal in the U.S. Senate to terminate wind and solar tax credits by 2028, raising concerns about the industry's outlook [4] - Reddit (RDDT.US) rose over 6% after launching the AI advertising tool Reddit Insights, enhancing ad targeting through real-time user trend analysis [4] - Bitcoin-related stocks fell, with CleanSpark (CLSK.US) down over 7% and Riot Platforms (RIOT.US) down over 5%, as Bitcoin prices dropped nearly 2% to $105,580 amid escalating tensions in the Middle East and high leverage positions in the derivatives market [4] - AMD (AMD.US) continued to rise 0.56% after officially launching the Zen5 architecture Ryzen Threadripper processors, covering the workstation and desktop markets, with a market share close to 50% in China for Q1, although there are concerns about its cost-performance ratio [5] - Brain Regen Technologies (RGC.US) surged over 30% after announcing a 38-for-1 stock split, coupled with FDA clinical trial approval news, although its actual business has no revenue and a very small float, indicating significant retail speculation [6] - Jabil (JBL.US) rose over 8%, reaching a new all-time high of $202.5, with Q3 revenue increasing 15% year-on-year to $7.83 billion, raising its full-year revenue forecast to $29 billion and planning a $500 million investment to support AI data center infrastructure [6] - Niu Technologies (NIU.US) increased over 11% after launching its new NX Play electric motorcycle on Douyin, integrating a smart riding system to enhance user experience [6] - T-Mobile US (TMUS.US) fell nearly 4% as SoftBank sold 21.5 million shares at $224 each, a 3% discount, triggering market sell-off [6] - The pharmaceutical sector saw widespread declines, with Eli Lilly (LLY.US) down over 2% and Novo Nordisk (NVO.US) down over 3%, as concerns grew over the potential impact of the U.S. Senate tax bill on the industry, coupled with profit-taking ahead of some companies' earnings reports [6] - The gold sector declined, with Gold Fields (GFI.US) down over 2.1%, and spot gold fell 0.27% to $3,375.53, as easing tensions in the Middle East reduced safe-haven demand, alongside Citigroup's bearish long-term gold price forecast [7]