By Elsa Ohlen

SolarEdge Technologies stock leapt after the maker of technology for solar-panel installations reported stronger results than expected and said tariffs would only cut margins by two percentage points.

SolarEdge reported an adjusted first-quarter loss of $1.14, from revenue of $219.5 million, while the consensus calls among analysts tracked by FactSet were for a loss of $1.16 and revenue of $204 million.

SolarEdge stock rose as much as 15% to $14.85 in premarket trading following the earnings release. Futures tracking the Nasdaq 100 were down 0.9%.

"Despite an uncertain tariff and regulatory environment, we remain relentlessly focused on elevating our execution across our business," CEO Shuki Nir said, noting that the company delivered a second straight quarter of positive free cash flow.

For the current quarter, SolarEdge now expects revenue between $265 million and $285 million, above the $244 million expected by analysts.

It sees second-quarter adjusted gross margin of between 8% and 12%, including an additional 2 percentage-point hit from tariffs. It didn't disclose the effects of tariffs on each category of products it handles.

The report contrasts with those from some SolarEdge peers. Shares of Enphase and First Solar, which also make solar panels and equipment, fell by double digits in late April after the companies reported weaker quarterly earnings than expected and indicated they would be hurt by tariffs in the current quarter.

First Solar sharply reduced its 2025 guidance, citing tariffs.

SunRun is expected to report quarterly earnings Wednesday.

The solar sector was under pressure even before the Trump administration began to roll out tariffs because weak residential demand and high interest rates have weighed on companies' profitability, as well as their stocks. Inventories at solar companies have risen, especially those specializing in residential systems.

In an earnings call with investors Tuesday morning, SolarEdge executives said inventories were returning to normal.

Another big concern for clean-energy investors is that the Republican leadership will scale back or even revoke former President Joe Biden's Inflation Reduction Act, which can give companies tax credits of up to 50% of a project's value.

Coming into Tuesday trading, SolarEdge stock was down nearly 80% over the past 12 months. The Invesco Solar ETF had fallen roughly 30% over the same period.

Write to Elsa Ohlen at elsa.ohlen@barrons.com

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May 06, 2025 09:35 ET (13:35 GMT)

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