Daqo New Energy Announces Unaudited First Quarter 2025 Results

Core Viewpoint - Daqo New Energy Corp. reported significant financial losses in Q1 2025 due to ongoing challenges in the solar PV industry, including overcapacity and low polysilicon prices, but noted a sequential narrowing of losses and a strong balance sheet with no financial debt [1][8]. Financial Performance - Revenues for Q1 2025 were $123.9 million, down from $195.4 million in Q4 2024 and $415.3 million in Q1 2024 [11]. - Gross loss was $81.5 million with a gross margin of -65.8%, compared to a gross loss of $65.3 million and a gross margin of -33.4% in Q4 2024 [12]. - Net loss attributable to Daqo New Energy Corp. shareholders was $71.8 million, an improvement from $180.2 million in Q4 2024 [17]. - Adjusted net loss (non-GAAP) was $53.2 million, compared to $170.6 million in Q4 2024 [19]. - EBITDA (non-GAAP) was -$48.4 million with an EBITDA margin of -39.1%, compared to -236.5 million and -121.1% in Q4 2024 [21]. Operational Highlights - Polysilicon production volume was 24,810 MT in Q1 2025, down from 34,236 MT in Q4 2024, while sales volume was 28,008 MT [6]. - Average total production cost increased to $7.57/kg from $6.81/kg in Q4 2024, and average cash cost rose to $5.31/kg from $5.04/kg [6][8]. - The company operated at a reduced utilization rate of approximately 33% of nameplate capacity due to market conditions [8]. Industry Context - The solar PV industry faced significant challenges, including persistent overcapacity and polysilicon prices below cash cost levels [8]. - China's new solar PV installations reached 59.71 GW in Q1 2025, reflecting a 30.5% year-over-year growth [8]. - A market-based reform policy for new energy on-grid tariffs was introduced by Chinese authorities, aiming to promote high-quality development in the renewable energy sector [8]. Future Outlook - The company expects to produce approximately 25,000 MT to 28,000 MT of polysilicon in Q2 2025 and a total of 110,000 MT to 140,000 MT for the full year [9]. - The management believes that ongoing losses and poor profitability will force less competitive players to exit the market, ultimately leading to a healthier solar PV industry [8].