Continued “weak demand” from the commercial and industrial (C&I) and residential segments has negatively impacted SMA Solar’s sales and income in the first quarter of 2025.
Both the Home Solutions and C&I Solutions segments have seen their sales severely drop on a yearly basis, and remain affected by the weakened demand in the European small-scale sector already highlighted in the last quarter of 2024. External sales from the residential segment fell by 65% from €62.6 million (US$70.33 million) in Q1 2024 to €21.9 million in Q1 2025, due to low demand and high inventories at distributors.
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As sales dropped in both segments, their share of total sales also severely dropped, with residential representing 6.7% in Q1 2025 (versus 17.3% in Q1 2024), while C&I’s sales represented 8% of the total sales, down from the 19.5% in Q1 2024.
The impact of the decrease in sales from both segments was partially alleviated by the increase in the Large Scale & Project Solutions segment, which increased by 22.2% in comparison with Q1 2024. The utility-scale segment registered sales of €279.5 million in Q1 2025, up from the €228.7 million in Q1 2024 and accounted for 85.3% of total sales (up from 63.2% in Q1 2024).
Moreover, the utility-scale segment improved its profitability year-on-year due to a high level of sales and the increase in productivity, achieving earnings before interest and taxes (EBIT) of €50.3 million in Q1 2025, compared to the €41.3 million registered in Q1 2024. Both the residential and C&I segments registered negative EBIT in Q1 2025 with -€19.6 million (-€3.6 million in Q1 2024) and -€26.4 million (-€18.2 million), respectively.
Overall, total sales dropped by 9.4% year-over-year from €361.8 million in Q1 2024 to €327.7 million in Q1 2025, while inverters sold also slightly decreased from 4.3GW in Q1 2024 to 4.1GW in Q1 2025.
Due to the lower sales and a decrease in fixed cost for the Home Solutions and Commercial & Industrial Solutions segments in Q1 2025, the company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) decreased by more than half year-on-year from €49.9 million in Q1 2024 to €24.6 million in Q1 2025.
However, despite the residential and C&I segments decreasing on a yearly basis, Jürgen Reinert, CEO of SMA said: “We saw a slight improvement in order intake in the Home Solutions and Commercial & Industrial solutions segments in the first quarter of 2025.”
“Looking ahead to the coming quarters, we expect order intake to be less volatile overall due to the further normalisation of inventories in distribution within these two segments, thereby returning to normal levels compared to the last two fiscal years.”
US tariff uncertainty
As has been the case with many solar companies in the past few weeks, the recent tariffs from Trump’s administration created ongoing uncertainties for companies, including SMA, according to its CEO Jürgen Reinert.
“The unclear US tariff policy and its potential consequences for the global solar industry, for example through investment postponements, remain a major source of uncertainty,” said Reinert.
Compared to last year’s first quarter, the Americas represented a bigger portion of the company’s total sales, going up from 25% in Q1 2024 to 40% in Q1 2025, while the European, Middle East and Africa (EMEA) region dropped from 68% to 48%.
