Research Alert: Enph Posts In-line Results And Guidance As U.s. Resi Sell-through Deteriorates
CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:ENPH posted Q1 sales of $283M (-21% Y/Y), near consensus ($282M). Non-GAAP EPS of $0.47 (-31% Y/Y) also slightly beat expectations ($0.45). Non-GAAP gross margin of 43.9% declined 220 bps sequentially and 500 bps Y/Y, mainly due to lower sales and elevated tariff impacts of 430 bps. U.S. demand deteriorated as expected, with sell-through falling 48% Q/Q and 18% Y/Y as the residential solar credit expired at year-end 25. ENPH disclosed $844M in TPO agreements YTD, which we view as supportive for future residential solar growth. The company also announced a new 1.25 MW data center product targeting 800-V AI racks. We think this product offers upside around 2028. However, we expect minimal near-term price movement, as the market is crowded and we view the announcement as largely expected. Q2 guidance calls for a sales midpoint of $295M (-19% Y/Y), matching consensus, with a gross margin of 45.5% exceeding the Street view (44.5%). We estimate Section 45-X credits provided about 1,000 bps of margin benefit in Q1.