First Solar · Earnings release

News Release

First Solar, Inc. Announces Third Quarter 2024 Financial Results

•Net sales of $0.9 billion

•Net income per diluted share of $2.91, impacted by $50 million product warranty reserve charge

•Net cash balance of $0.7 billion

•YTD net bookings of 4.0 GW; 0.4 GW since second quarter earnings call

•Expected sales backlog of 73.3 GW

TEMPE, Ariz., October 29, 2024 – First Solar, Inc. (Nasdaq: FSLR) (the “Company”) today announced financial results for the third quarter ended September 30, 2024.

Net sales for the third quarter were $0.9 billion, a decrease of $0.1 billion from the prior quarter. The decrease was primarily driven by a decrease in the volume of MW sold and a product warranty reserve charge, partially offset by termination payments from certain customers in the U.S. and India.

The Company reported third quarter net income per diluted share of $2.91, compared to net income per diluted share of $3.25 in the second quarter of 2024.

Cash, cash equivalents, restricted cash, restricted cash equivalents, and marketable securities, less debt at the end of the third quarter, decreased to $0.7 billion from $1.2 billion at the end of the prior quarter. The decrease was primarily driven by capital expenditures associated with our new U.S. factories in Alabama and Louisiana along with an increase in working capital.

“As we approach the end of 2024, we remain pleased with the progress made across our business, navigating against a backdrop of industry volatility and political uncertainty, with a continued focus on balancing growth, profitability, and liquidity,” said Mark Widmar, CEO of First Solar. “We expect that our disciplined, long-term approach will allow us to work through the outcomes of the upcoming US elections as well as the continued volatility across the solar manufacturing industry.”

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Our 2024 guidance has been updated as follows:

Prior

Current

G1Net Sales

G2Gross Margin (1)

G3Operating Expenses (2)

G4Operating Income (3)

G5Earnings per Diluted Share

G6Net Cash Balance (4)

G7Capital Expenditures

G8Volume Sold

——————————

(1)Assumes $60 million to $75 million of ramp costs and $1.02 billion to $1.05 billion of Section 45X tax credits

(2)Assumes $70 million to $80 million of production start-up expense

(3)Assumes $130 million to $155 million of production start-up expense and ramp costs, and $1.02 billion to $1.05 billion of Section 45X tax credits

(4)Defined as cash, cash equivalents, restricted cash, restricted cash equivalents, and marketable securities, less expected debt at the end of 2024

The guidance figures presented above are forward-looking statements that are subject to a variety of assumptions and estimates, including with respect to certain factors related to the Inflation Reduction Act of 2022 (the “IRA”). Among other things, such factors include (i) the total Section 45X tax credit and (ii) the timing and ability to monetize such credit. Investors are encouraged to listen to the conference call and to review the accompanying materials, which contain more information about First Solar’s third quarter 2024 financial results, 2024 guidance, and financial outlook.

Conference Call Details

First Solar has scheduled a conference call for today, October 29, 2024, at 4:30 p.m. ET, to discuss this announcement. A live webcast of this conference call and accompanying materials are available at investor.firstsolar.com. A replay of the webcast will be available on the Investors section of the Company’s website approximately two hours after the conclusion of the call and remain available for 30 days.

About First Solar, Inc.

First Solar is a leading American solar technology company and global provider of responsibly produced eco-efficient solar modules advancing the fight against climate change. Developed at research and development labs in California and Ohio, the Company’s advanced thin film photovoltaic (“PV”) modules represent the next generation of solar technologies, providing a competitive, high-performance, lower-carbon alternative to conventional crystalline silicon PV panels. From raw material sourcing and manufacturing through end-of-life module recycling, First Solar’s approach to technology embodies sustainability and a responsibility towards people and the planet. For more information, please visit www.firstsolar.com.

For First Solar Investors

This release contains forward-looking statements which are made pursuant to safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements in this release, other than statements of historical fact, are forward-looking statements. These forward-looking statements include, but are not limited to, statements concerning: demand for our technology; increased research and development investment; new domestic and international capacity coming online; production and delivery of our modules; anticipated claims under our limited product warranty obligations and any related remediation commitments; our financial guidance for 2024, including future financial results, net sales, gross margin, operating expenses, operating income, earnings per diluted share, net

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cash balance, capital expenditures, expected earnings cadence, volume sold, shipments, bookings, products and our business and financial objectives for 2024; the availability of benefits under certain production linked incentive programs, and the impact of the IRA including the total advanced manufacturing production credit available to us under Section 45X of the Internal Revenue Code. These forward-looking statements are often characterized by the use of words such as “estimate,” “expect,” “anticipate,” “project,” “plan,” “intend,” “seek,” “believe,” “forecast,” “foresee,” “likely,” “may,” “should,” “goal,” “target,” “might,” “will,” “could,” “predict,” “continue,” “contingent” and the negative or plural of these words and other comparable terminology. Forward-looking statements are only predictions based on our current expectations and our projections about future events and therefore speak only as of the date of this release.

You should not place undue reliance on these forward-looking statements. We undertake no obligation to update any of these forward-looking statements for any reason, whether as a result of new information, future developments or otherwise. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from those expressed or implied by our forward-looking statements. These factors include, but are not limited to: structural imbalances in global supply and demand for PV solar modules; our competitive position and other key competitive factors; the market for renewable energy, including solar energy; the reduction, elimination, expiration or introduction of government subsidies, policies, and support programs for solar energy projects; the impact of public policies, such as tariffs or other trade remedies imposed on solar cells and modules; the passage of legislation intended to encourage renewable energy investments through tax credits, such as the IRA; the impact of the IRA on our expected results of operations in future periods, which may be affected by technical guidance, regulations, subsequent amendments or interpretations of the law; interest rate fluctuations and both our and our customers’ ability to secure financing; changes in the exchange rates between the functional currencies of our subsidiaries and other currencies in which assets and liabilities are denominated; our ability to execute on our long-term strategic plans; the loss of any of our large customers, or the ability of our customers and counterparties to perform under their contracts with us; our ability to execute on our solar module technology and cost reduction roadmaps; the performance of our solar modules upon installation; our ability to improve the wattage of our solar modules; our ability to incorporate technology improvements into our manufacturing process, including the production of bifacial solar modules and the implementation of our Copper Replacement (“CuRe”) program; the satisfaction of conditions precedent in our sales agreements; our ability to attract new customers and to develop and maintain existing customer and supplier relationships; general economic and business conditions, including those influenced by U.S., international, and geopolitical events; environmental responsibility, including with respect to cadmium telluride (“CdTe”) and other semiconductor materials; claims under our limited warranty obligations; changes in, or the failure to comply with, government regulations and environmental, health, and safety requirements; effects arising from and results of pending litigation; future collection and recycling costs for solar modules covered by our module collection and recycling program or otherwise as required by laws and regulations; supply chain disruptions; our ability to protect our intellectual property; our ability to prevent and/or minimize the impact of cybersecurity incidents including breaches or outages of our information systems; our continued investment in research and development; the supply and price of components and raw materials, including CdTe; our ability to construct new production facilities to support new product lines in line with anticipated timing; evolving corporate governance and public disclosure regulations and expectations, including with respect to environmental, social and governance matters; our ability to avoid manufacturing interruptions, including during the ramp of our manufacturing facilities; our ability to attract and retain key executive officers and associates; the severity and duration of public health threats, including the potential impact on our business, financial condition, and results of operations; and the matters discussed under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our most recent Annual Report on Form 10-K, as supplemented by our other filings with the Securities and Exchange Commission.

Contacts

First Solar Investors First Solar Media

investor@firstsolar.com media@firstsolar.com

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FIRST SOLAR, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

(Unaudited)

ASSETS

Current assets:

Cash and cash equivalents

$

$

Marketable securities

Accounts receivable trade, net

Government grants receivable, net

Inventories

Other current assets

Total current assets

Property, plant and equipment, net

Deferred tax assets, net

Restricted marketable securities

Government grants receivable

Goodwill

Intangible assets, net

Inventories

Other assets

Total assets

$

$

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable

$

$

Income taxes payable

Accrued expenses

Current portion of debt

Deferred revenue

Other current liabilities

Total current liabilities

Accrued solar module collection and recycling liability

Long-term debt

Deferred revenue

Other liabilities

Total liabilities

Commitments and contingencies

Stockholders’ equity:

Common stock, $0.001 par value per share; 500,000,000 shares authorized; 107,057,732 and 106,847,475 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively

Additional paid-in capital

Accumulated earnings

Accumulated other comprehensive loss

Total stockholders’ equity

Total liabilities and stockholders’ equity

$

$

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FIRST SOLAR, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

Three Months Ended

Nine Months Ended

Net sales

$

$

$

$

$

Cost of sales

Gross profit

Operating expenses:

Selling, general and administrative

Research and development

Production start-up

Litigation loss

—

—

Total operating expenses

Gain on sales of businesses, net

—

—

Operating income

Foreign currency loss, net

Interest income

Interest expense, net

Other expense, net

Income before taxes

Income tax expense

Net income

$

$

$

$

$

Net income per share:

Basic

$

$

$

$

$

Diluted

$

$

$

$

$

Weighted-average number of shares used in per share calculations:

Basic

Diluted

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FIRST SOLAR, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

Nine Months Ended

Cash flows from operating activities:

Net income

$

$

Adjustments to reconcile net income to cash provided by operating activities:

Depreciation, amortization and accretion

Share-based compensation

Deferred income taxes

Gain on sales of businesses, net

Other, net

Changes in operating assets and liabilities:

Accounts receivable, trade

Inventories

Government grants receivable

Other assets

Income tax receivable and payable

Accounts payable and accrued expenses

Deferred revenue

Other liabilities

Net cash provided by operating activities

Cash flows from investing activities:

Purchases of property, plant and equipment

Purchases of marketable securities and restricted marketable securities

Proceeds from sales and maturities of marketable securities

Acquisitions, net of cash acquired

—

Other investing activities

—

Net cash used in investing activities

Cash flows from financing activities:

Proceeds from borrowings under debt arrangements, net of issuance costs

Repayment of debt

—

Payments of tax withholdings for restricted shares

Contingent consideration payment and other financing activities

—

Net cash (used in) provided by financing activities

Effect of exchange rate changes on cash, cash equivalents, restricted cash, and restricted cash equivalents

Net (decrease) increase in cash, cash equivalents, restricted cash, and restricted cash equivalents

Cash, cash equivalents, restricted cash, and restricted cash equivalents, beginning of the period

Cash, cash equivalents, restricted cash, and restricted cash equivalents, end of the period

$

$

Supplemental disclosure of noncash investing and financing activities:

Property, plant and equipment acquisitions funded by liabilities

$

$

Proceeds to be received from asset-based government grants

$

$

Acquisitions funded by contingent consideration

$

$

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