Title

Earning Preview: Sunrun Q4 revenue is expected to increase by 14.22%, and institutional views are bullish

Abstract

Sunrun Inc. will report fourth-quarter and full-year 2025 results on February 26, 2026, Post Market; this preview outlines consensus expectations for revenue and adjusted EPS, reviews last quarter’s performance, and highlights the segments and operational drivers most likely to shape near-term outcomes.

Market Forecast

Consensus forecasts point to Sunrun Inc. delivering revenue of $614.41 million this quarter, up 14.22% year over year, with adjusted EPS estimated at -$0.05 and EBIT at -$94.41 million, implying year-over-year changes of 79.35% and 37.01% respectively. Guidance for margins is not available in the forecast dataset, but the revenue mix continues to be led by customer agreements and incentives, with solar systems and products providing added volume flexibility and monetization. The main business highlight centers on recurring cash generation from customer agreements and incentives and the durable attachment of storage to new installs, reinforcing unit economics and backlog monetization. The most promising segment is solar systems and products, which generated $232.96 million last quarter; storage attachment rates rose to 70% from 60% a year earlier, underlining a robust upsell and cross-sell trajectory into the current quarter.

Last Quarter Review

Sunrun Inc. reported third-quarter revenue of $724.56 million, a gross profit margin of 33.57%, GAAP net profit attributable to the parent company of $16.59 million, a net profit margin of 2.29%, and adjusted EPS of $0.06, rising 116.22% year over year; total revenue grew 34.88% year over year. A notable operational highlight was the substantial revenue beat against expectations and positive EBIT of $3.65 million, reflecting stronger-than-modeled execution and backlog conversion despite cost and financing headwinds. Main business traction remained anchored by customer agreements and incentives at $491.60 million, while the storage attachment rate reached 70% and customer additions with storage grew 20% year over year, supporting higher lifetime value per installation.

Current Quarter Outlook

Main Business: Customer Agreements and Incentives

Customer agreements and incentives form the core of Sunrun Inc.’s revenue base and cash generation framework, with last quarter’s revenue contribution at $491.60 million. This quarter, the segment’s performance is likely to hinge on installation pace, contract monetization, and the storage attachment dynamics that influence unit economics. The steady upswing in storage attachment rates—at 70% last quarter—supports higher system values and a deeper customer relationship, improving cross-sell opportunities and ancillary service potential. Near term, the revenue trajectory should track the forecast for total revenue at $614.41 million, given that customer agreements are typically a majority of mix and are less volatile than systems sales. Cash generation in this segment relates closely to incentives utilization and the timing of sales of tax attributes, which may cause quarter-to-quarter variability in reported profitability without altering the underlying economics of the agreements. While margin guidance is not available for the current quarter, the historical gross profit margin of 33.57% provides a baseline for evaluating cost discipline and pricing strategy against input costs and financing conditions. A further consideration is the quarter-on-quarter movement in net profit noted last quarter, where net profit’s quarter-on-quarter change registered -94.07%. This underscores the sensitivity of reported GAAP results to the cadence of monetization events and non-cash valuation effects. Investors should focus on the cohesion between contract value creation and realized cash, as this is likely to be the differentiator in assessing the sustainability of earnings into the spring reporting cycle.

Most Promising Business: Solar Systems and Products with Storage Upsell

Solar systems and products contributed $232.96 million in the last quarter, and the ongoing strength in storage attachments signals the most promising vector for incremental value. Customer additions with storage rose 20% year over year in the last reported period, and the storage attachment rate of 70% indicates a consistent preference for combined solar-plus-storage solutions. This uptick in storage penetration enhances revenue per installation and typically supports better gross margins through premium pricing and improved energy resilience value propositions. In the current quarter, the revenue contribution from solar systems and products will be shaped by product mix, pricing, and the velocity of installations. The uptrend in storage uptake has also expanded Sunrun Inc.’s networked storage capacity to approximately 3.7 gigawatt hours across more than 217,000 installed systems, which creates optionality for grid services participation and potential recurring revenue streams beyond the initial system sale. These dynamics, in turn, could provide qualitative support to margin continuity even as equipment and financing costs fluctuate, given the value-added nature of storage and its role in enhancing system economics. Importantly, solar systems and products provide tactical agility: as permitting cycles, local incentive availability, and supply chain timing vary, the company can calibrate price and product configurations to maintain throughput. The absence of an explicit gross margin forecast necessitates monitoring price realization and deployment costs this quarter, but the above indicators suggest that storage-enabled systems will remain the primary growth lever for revenue quality and potential margin support.

Key Stock Price Drivers This Quarter

The stock’s near-term reaction is likely to reflect the interplay between headline revenue and adjusted EPS delivery relative to forecasts, with current-quarter expectations calling for $614.41 million in revenue and an adjusted EPS of -$0.05. A narrower-than-expected loss per share or stabilizing EBIT trajectory could improve sentiment, especially after the mixed reaction to last quarter’s print. Conversely, any meaningful shortfall in revenue or a wider EPS loss would pressure the shares, given the sensitivity of multiples to profitability trends and cash generation narratives. Storage momentum is a critical qualitative driver. The continued rise in storage attachment rates to 70% and the 20% year-over-year growth in storage-enabled customer additions last quarter indicate healthy demand for premium solutions and higher revenue per install. If Sunrun Inc. demonstrates that this trend is intact or accelerating, investor attention may shift toward lifetime value, improved contract economics, and the potential for monetizing grid services associated with the expanding installed base. Evidence of consistent storage pipeline conversion would likely enhance confidence in forecasted revenue growth and moderate concerns about variability in quarterly GAAP profitability. Policy and financing conditions round out the biggest drivers of equity performance this quarter. As noted by institutional commentary, favorable tax credit and tariff policies remain supportive to the business framework, which helps underpin volume and contract value. At the same time, the cost of capital and incentive timing continue to impact reported margins and profitability cadence. Operational execution around backlog conversion, incentive utilization, and pricing in solar systems and products will be essential for aligning reported figures with the revenue and EPS forecasts, and the market will watch how these elements coalesce in the February 26, 2026 release.

Analyst Opinions

Institutional views skew bullish in the six months through February 19, 2026, with buy/outperform stances outnumbering bearish commentary; we count four bullish ratings against one bearish article, making the ratio roughly 80% bullish. TD Cowen maintained a Buy rating with a $23.00 price target, highlighting favorable setup into the coming quarters. Oppenheimer also reiterated a Buy with a $23.00 price target, indicating positive conviction in Sunrun Inc.’s execution and financial trajectory. Goldman Sachs maintained its Buy rating with a $19.00 target, remaining constructive on the path to profitability within the forecast framework and the potential for improved cash generation. Mizuho reiterated Sunrun Inc. as an Outperform and listed the company among its favorite ideas for 2026, emphasizing benefits from favorable tax credit and tariff policies and observing that the sector has not yet seen direct demand attributable to AI, implying further room for structural tailwinds to run their course. The majority bullish view hinges on several pillars. First, the anticipated year-over-year revenue growth of 14.22% this quarter provides a tangible baseline for confidence, particularly given last quarter’s 34.88% year-over-year revenue expansion and the magnitude of the revenue beat. Second, operational data around storage—attachment rates at 70% and customer additions with storage growing 20% year over year—suggests a supportive mix shift toward higher-value installs. Analysts who are constructive highlight that these trends underpin stronger unit economics and reinforce cash generation potential, even if quarterly GAAP results show variability due to incentive timing and valuation effects. Third, the forecasts for adjusted EPS at -$0.05 and EBIT at -$94.41 million incorporate improvements on a year-over-year basis of 79.35% and 37.01%, respectively, pointing to a trajectory that may be indicative of discipline in cost structure and pricing actions. This is a central thread in the bullish narrative: even absent explicit gross margin guidance for the quarter, analysts view the rising storage mix and consistent performance in customer agreements and incentives as key to improving profitability trends over time. Should these elements converge with steady volume throughput and efficient monetization of tax attributes, the near-term skepticism tied to quarterly variability may give way to a firmer valuation backdrop. Finally, institutions emphasize the constructive policy environment. Mizuho’s perspective that favorable tax credit and tariff policies support Sunrun Inc.’s opportunity set is a significant component of the majority stance. The combination of these structural supports with demonstrated storage momentum creates a thesis that the current forecast—revenue of $614.41 million and improved year-over-year EPS and EBIT growth—is achievable and could serve as a catalyst if the company presents visibility on cash generation and margin continuity. In sum, the majority of analysts lean bullish heading into February 26, 2026, citing revenue growth, storage-led mix enhancement, and supportive policies as the key drivers of an improving outlook for Sunrun Inc.