German solar inverter manufacturer SMA Solar saw falling income, sales and earnings in 2024 as a result of weakened demand in the European small-scale solar sector and increased inventory across the continent.
SMA Solar posted preliminary net losses of €117.7 million (US$126 million) in 2024—down from €225.7 million in income last year—and earnings per share almost halved from €6.50 (US$6.96) to €3.39 (US$3.63).
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The company’s EBITDA was -€16 million, “significantly below” €311 million recorded in 2023.
Sales also fell by 19.7% to €1,530 million (US$1,639 million); including 19.5GW of inverter output sales, down from 20.5GW in 2023.
SMA CEO Jürgen Reinert concluded: “The 2024 fiscal year was overall very challenging.”
The decline was sharpest in SMA Solar’s Home Solutions and Commercial & Industrial (C&I) Solutions business segments, which supply products to the small-scale distributed solar markets. The former saw sales collapse from €580.2 million (US$621 million) in 2023 to €170.3 million (US$182 million); the latter performed slightly better, falling from €478.9 million (US$512 million) to €183.8 million (US$197 million) year-on-year.
Big challenges at small-scale
This was “Due to the lower demand situation combined with high inventories at distributors,” SMA said. CEO Reinert added: “The operating performance of the segments Home Solutions and Commercial & Industrial Solutions was significantly shaped by the overcapacity on the market and the declining demand in the home and commercial sector.”
The European distributed solar market has cooled in the last year following the white heat of expansion during the 2022-23 energy crisis after Russia began the war in Ukraine. A number of countries across the European bloc—including Italy, the Netherlands, and Poland—have shifted away from the incentives for rooftop PV they implemented during the crisis.
SMA Solar cited a “sustained market slowdown” in the residential and C&I sectors in its November decision to cut up to 1,100 jobs by the end of this year. At the same time it predicted that the small-scale markets would “stagnate” for the foreseeable future.
The company is not alone in feeling the effects of these changes. Its competitors – notably Israel-headquartered SolarEdge and US-based Enphase Energy – have also seen declining revenues over the last year and have announced their own workforce cuts.
By contrast, SMA Solar’s Large Scale & Project Solutions segment saw sales increase “considerably” to €1,175.8 million, up from €845.0 million in 2023. It said this was due to “the high sales level combined with a reduction in fixed costs, a profitable product mix and the sale of a battery storage project by SMA Altenso GmbH.”
PV Tech Premium spoke last year to an analyst from S&P Global about the market and technological dynamics affecting Western inverter manufacturers.
2025 plans
The company said it is “working on significantly reducing its cost base and simplifying the corporate structure and corporate management”. This will include merging its residential and C&I divisions to form a new “Home & Business Solutions” segment “in the first half of 2025”.
SMA CFO Barbara Gregor said: “In operational terms, we expect the new HBS division to maintain a stable sales level in the current year. Earnings of this division will be significantly higher than last year but will not yet reach the break-even point.”
Reinert added: “Since September 2024, we have [implemented] a comprehensive restructuring and transformation program. In addition to enhancing efficiency and maintaining our strategic focus as a leading global system and solution provider, we plan to save €150 to €200 million starting from 2026.”
The company expects EBITDA between €70 million (US$74.8 million) and €110 million (US$117.6 million) in the 2025 financial year.
