Tigo Energy to lower inventory by Q1 2024, poses decreased FY 2023 results

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Module-level power electronics solutions from Tigo. Image: Tigo Energy.

Module-level power electronics supplier Tigo Energy expects its losses will continue in the first quarter of 2024, according to its latest financial result announcement.

The company said revenue in Q1 2024 is expected to range between US$9 million and US$14 million, while the adjusted EBITDA loss will be between $8 million and $12 million, close to the adjusted EBITDA loss of US$11.6 million in Q4 2023.

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Commenting on the financial guidance, Zvi Alon, chairman and CEO of Tigo, said: “Our business faced order push-outs and cancellations that ramped more significantly than expected through the second half of last year, largely driven by elevated inventory levels in the channel.”

He added that these headwinds had created significant uncertainties and limited the company’s performance, resulting in significant losses of adjusted EBITDA. In response to the situation, Tigo Energy reduced workforce by 15% in Q4 2023.

Alon commented: “As we turn to 2024, we believe the ongoing inventory digestion cycle will be substantially complete by the end of the current quarter and that we are solidly positioned to expand our market share as the industry upturn emerges.”

In addition to the Q1 outlook, the company also announced the financial results of Q4 2023 and FY 2023. Revenue in 2023 totalled US$145.2 million, a 78.6% increase from US$81.3 million in 2022. Adjusted EBITDA in 2023 decreased to US$1 million, down from US$2.5 million in 2022.

In Q4, revenue totalled US$9.2 million, decreasing by 70.1% from US$30.9 million in Q4 2022. Adjusted EBITDA loss totalled US$11.6 million for Q4 2023, compared to adjusted EBITDA of US$2.7 million for Q4 2022.

The company also explained the business of its products. For example, it deployed 10 million Tigo TS4 devices, as its revenue grew by 69% to US$119 million compared to US$70 million in 2022.

“Furthermore, our GO ESS product line grew steadily last year to represent approximately 9.2% of our total revenues and continues to show signs of progress this year,” said Alon.

Conference call transcript from Seeking Alpha.

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