Array Technologies Inc ((ARRY)) has held its Q4 earnings call. Read on for the main highlights of the call.
Array Technologies’ recent earnings call revealed a mixed sentiment, underscoring both achievements and challenges. The company showcased strong financial performance with notable margin improvements and cash flow generation in 2024. However, it faced hurdles such as revenue decline, impairment charges, and market difficulties in Brazil. Despite these challenges, the guidance for 2025 remains optimistic, with a projected 20% growth in top-line revenue.
Strong Financial Performance in 2024
Array Technologies reported impressive financial results for 2024, achieving $275 million in revenue for Q4 and $916 million for the full year, surpassing the midpoint of their guidance. The company also improved its adjusted gross margin by 410 basis points in Q4 and 680 basis points for the full year compared to 2023.
Significant Cash Flow and Cash Balance
The company generated $135 million in free cash flow and concluded the year with a robust cash balance of $364 million, highlighting its strong financial health and operational efficiency.
Order Book Growth
Array Technologies’ order book reached $2 billion by the end of the year, reflecting a 10% increase from the previous year, with domestic orders growing by 20%. This growth indicates a solid demand for their products and services.
Innovation and Product Development
The company introduced innovative products such as the OmniTrack terrain following tracker, which now constitutes over 20% of the order book. Additionally, a new reusable packaging initiative was launched to enhance sustainability efforts.
Revenue Decline
Despite the successes, Array Technologies experienced a 19% decline in Q4 2024 revenue compared to the prior year, primarily due to commodity-correlated ASP declines and project pushouts.
Goodwill and Asset Impairment
The company recorded significant non-cash charges, including a $236 million goodwill impairment and a $91.9 million write-down of long-lived intangible assets related to the 2022 STI acquisition.
Net Loss for 2024
Array Technologies reported a net loss of $296.1 million attributable to common shareholders, a stark contrast to the net income of $85.5 million reported in the previous year.
Challenges in Brazil
The company faced significant challenges in Brazil due to the devaluation of the Brazilian real, volatile interest rates, and new tariffs on solar components, which have considerably slowed market growth.
Guidance for 2025
Looking ahead, Array Technologies provided a promising outlook for 2025, expecting to exceed market growth with a 20% increase in top-line revenue. The company forecasts revenue between $1.05 billion and $1.15 billion, with an adjusted EBITDA of $180 million to $200 million and adjusted EPS of $0.60 to $0.70. This guidance reflects a cautious yet optimistic approach, driven by strong project execution and expanding domestic content capabilities.
In summary, Array Technologies’ earnings call painted a picture of resilience and innovation amidst challenges. The company achieved significant financial milestones in 2024, yet faced revenue declines and market difficulties. Looking forward, the optimistic guidance for 2025 suggests a focus on growth and strategic execution, promising a brighter future for the company.