Canadian Solar Cuts FY23 Revenue Guidance Post Mixed Q2 Performance

Canadian Solar Inc CSIQ reported second-quarter FY23 revenue growth of 2% year-on-year to $2.36 billion, missing the consensus of $2.48 billion. 

CSIQ's Q2 revenue grew by 39% sequentially due to higher solar module shipment volume and higher project sales, partially offset by a decline in module average selling price (ASP). Solar module shipments were 8.2 GW, up 62% Y/Y.

Margin: The gross margin increased by 260 bps to 18.6%.

EPS of $2.39 beat the consensus of $1.52. Canadian Solar generated $290 million in operating cash flow and held $3.2 billion in cash and equivalents.

Dr. Shawn Qu, Chairman and CEO, commented, "We successfully completed the IPO of our CSI Solar subsidiary, raising approximately $975 million in gross proceeds to support our ambitious growth plans across our solar and battery energy storage businesses. We also continued to strengthen our competitive position in core markets such as the U.S., where we are making long-term investments and building a state-of-the-art 5 GW solar module manufacturing plant under the backdrop of the Inflation Reduction Act." 

Outlook: Canadian Solar expects Q3 revenue of $1.9 billion - $2.1 billion (consensus $2.47 billion).  

Total module shipments recognized as revenues by CSI Solar will likely be 8.5 GW - 8.7 GW.

Canadian Solar cuts FY23 revenue to $8.5 billion - $9.0 billion (prior $9.0 billion - $9.5 billion) (consensus $9.27 billion). 

The company reiterated CSI Solar's total module shipments of 30 GW - 35 GW and battery storage shipments of 1.8 GWh - 2.0 GWh.

Price Action: CSIQ shares traded higher by 0.78% at $31.00 in the premarket session on the last check Tuesday.