Array Technologies, an US solar tracker manufacturer, has unveiled its third-quarter financial performance for this year, painting a dynamic picture of the company's growth and challenges. Amidst the Q3 results, a 32% decline in revenue to $350.4 million stands out, primarily attributed to reduced shipments.
In the third quarter, Array Technologies experienced a 22% reduction in the total MWs shipped, coupled with a 12% decrease in the average selling price, influenced by cost-saving measures. Consequently, the revenue dropped from $515 million in Q3 2022 to $350.4 million in Q3 2023. In comparison to Q2 2023, the quarterly revenue witnessed a 31% decrease, falling from $507.7 million.
On a more positive note, the gross profit saw a 14% increase to $87.4 million when compared to the same period in 2022, primarily driven by a rise in gross profit as a percentage of revenue, albeit slightly offset by a decrease in volume. Nonetheless, Q3 2023 saw a significant 41.7% drop in gross profit quarter-on-quarter.
Array Technologies also reported a boost in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA), rising to $57.4 million, compared to $55.4 million in the prior-year period.
Looking ahead, the company has projected its revenue to fall within the range of $1,525 million to $1,575 million, with adjusted EBITDA expected to be in the range of $280 million to $290 million.
CEO Kevin Hostetler noted, “We are seeing a steady increase in our domestic pipeline, which has more than doubled from the second quarter. This increase is a key early indicator of the expected momentum in our orderbook.” Despite some challenges caused by project timing delays, Hostetler expressed optimism about the company's operational execution, particularly in expanding its non-tracker offerings, which are poised to enhance margins in the latter half of the year.
In addition to its financial results, Array Technologies announced plans to construct a second manufacturing plant in Albuquerque, New Mexico, with construction set to commence in early 2024. The venture will be backed by a $50 million investment from Array Technologies and its partners.
Furthermore, in July, the company forged a collaboration with Lock Joint Tube, a Texas-based manufacturer of structural and mechanical-grade steel tubing, aimed at procuring steel tubing. This strategic move aligns with the Internal Revenue Service's guidelines on domestic content tax credits under the Inflation Reduction Act, offering a 10% bonus to renewable projects that meet the criteria for domestically-sourced components and materials. Array Technologies continues to adapt and grow in a dynamic solar industry landscape.