SunPower (NASDAQ:SPWR) shares tanked in the morning session today after the residential solar technology and energy services provider reported lower-than-expected numbers for the third quarter, with EPS of -$0.18 lagging estimates by $0.19. Further, revenue declined by 9.2% year-over-year to $432 million, falling short of expectations by $21.5 million.
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The company is witnessing demand softness and delayed revenue recognition caused by longer cycle times. It is now focusing on optimizing costs and has lowered its outlook for the full year. Adjusted EBITDA for Fiscal year 2023 is anticipated at -$35 million, compared to the prior outlook of -$25 million. Similarly, net loss is now projected to be -$175 million versus the earlier expectation of -$165 million.
Despite these challenges, SunPower added 18,800 new customers in the third quarter and began the fourth quarter with a backlog of 18,400 retrofit customers. Additionally, bookings in September rose by 59% compared to August. Importantly, the company is experiencing traction in its Financial segment, with a 20% year-over-year growth in attach rate for finance solutions and a 217% jump in lease net bookings in Q3.
Is SPWR a Good Stock?
Still, SPWR investors have seen the value of their holdings in the stock plunge by nearly 78% so far this year. Today’s price decline has now brought SPWR’s share price back to levels last seen in April 2020.
Overall, the Street has a Hold consensus rating on SunPower. The average SPWR price target of $6.53 implies a 65.7% potential upside.
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