SunPower has updated its expected fiscal second-quarter financial results, joining a growing number of PV manufacturers adjusting to weaker-than-expected demand in the second quarter of 2011. SunPower narrowed its revenue forecast from between US$500-US$600 million to approximately $590-$595 million. Non-GAAP gross margin is set to fall from previous guidance of 15-17% to between 12-13% for the quarter. One-time pretax charges are expected to reach US$75 million. Gross margin is expected to be to be in the range of approximately 3-4%, and a GAAP loss per share of approximately US$1.50-US$1.55.
"While we met our revenue goals for the second quarter, our gross margin and bottom-line performance was impacted by market conditions in Germany and Italy," commented, Tom Werner, SunPower president and CEO. "Despite these challenges, we successfully reduced inventory quarter over quarter and have begun the process of cancelling above-market third-party cell contracts. In addition, we continue to execute on our accelerated cost reduction roadmap and are ahead of our original plan. With the closure of the Total transaction, we commenced negotiations with banks to effectively utilize our US$1 billion credit support agreement and expect to enter into new and more flexible credit facilities shortly. With continued strong demand for our high-efficiency systems and our partnership with Total, we are poised to gain share profitably."
The one-time pretax charges are expected to reach US$75 million, which included US$29.3 million related to the company's panel reallocation strategy, as utility-scale projects stalled during and after the Italian Government introduced new tariff systems.
SunPower also incurred expenses of US$13.1 million in expenses related to the Total tender offer, and US$32.5 million related to the write-down of third-party inventory and costs associated with the termination of third-party cell supply contracts.
SunPower releases 2Q results and its 2011 outlook on Tuesday, August 9.