FSLR · Q1 2026 Earnings

Cautious

First Solar

Reported April 30, 2026

30-second summary

First Solar delivered $1.044B revenue (+24% YoY) and $3.22 GAAP EPS in Q1, with adjusted EBITDA of $520M landing above the high end of the $400–500M preview range — the operational read is clean. But the forward signal is unchanged in every material respect: FY2026 revenue ($4.9–5.2B), volume (17.0–18.2 GW), gross profit ($2.4–2.6B), and EBITDA ($2.6–2.8B) all reaffirmed, and Q2 EBITDA guided to $400–500M (midpoint flat vs. Q1's $520M beat). Backlog ticked down to 47.9 GW from 50.1 GW at year-end. Net cash declined from $2.4B at YE2025 to $2.0B at Q1 end (-$400M), reflecting seasonal working capital build and capex. Management is running SE Asia at depressed utilization as deliberate option value on the Section 232 decision, and the entire 2026 trajectory remains contingent on a tariff outcome that has slipped further into Q2.

Headline numbers

EPS

Q1 FY2026

$3.22

Revenue

Q1 FY2026

$1.04B

+24.0% YoY

Gross margin

Q1 FY2026

46.5%

Operating margin

Q1 FY2026

33.0%

Key financials

Q1 FY2026

Metric	Q1 FY2026	YoY	Q4 FY2025	QoQ
Revenue	$1.04B	+24.0%	$1.68B	-38.0%
EPS	$3.22	—	$4.84	-33.5%
Gross margin	46.5%	—	39.5%	+700bps
Operating margin	33.0%	—	32.6%	+40bps

Guidance

Company reaffirms all FY2026 full-year guidance with no changes to revenue, volume, profitability, or balance sheet targets.

Guidance is issued for both next quarter and the full year. Both may appear below.

New guidance

Metric	Period	Guide	YoY
Module sales volume	Q2 FY2026	3.4 GW to 4.0 GW	—
Section 45X tax credits	Q2 FY2026	$330 million to $400 million	—
Adjusted EBITDA	Q2 FY2026	$400 million to $500 million	—

Reaffirmed unchanged this quarter: Revenue ($4.9B to $5.2B), Volume sold (17.0 GW to 18.2 GW), Gross profit ($2.4B to $2.6B), Operating expenses ($610M to $635M), Adjusted EBITDA ($2.6B to $2.8B), Capital expenditures ($0.8B to $1.0B), Net cash balance ($1.7B to $2.3B)

Capacity & utilization

Q1 FY2026

Segment	Q1 FY2026
Contracted Sales Backlog	47.9 GW
Gross Cash Balance	$2.4 billion
Net Cash Balance	$2.0 billion

Profitability

Q1 FY2026

Segment	Q1 FY2026
Adjusted EBITDA	$520 million
Adjusted EBITDA Margin	50%

Management tone

Q2 "Tariffs override the policy tailwind" → Q3 "BP default and structural underutilization" → Q4 "Idle capacity as deliberate option value" → Q1 "Reaffirmed posture; offensive on IP and India"

Underutilization has hardened from one-year option to multi-quarter base case. Q4 framed Malaysia/Vietnam at reduced utilization as a deliberate one-year carry awaiting the 232 decision. This quarter's framing — "our international facilities in Malaysia and Vietnam continue to operate at a significantly reduced utilization consistent with current trade dynamics and lower ASP expectations for internationally produced modules" — drops the "we chose to" energy and accepts depressed utilization as the operating reality through the 232 timeline, which has slipped from "Q2 target" with "things can always move" caveats. The FY EBITDA reaffirmation embeds this absorption.

IP enforcement has moved from posture to active litigation lever. Across 2025, IP and Chinese supply chain decoupling were thematic talking points. This quarter management cites a Section 337 ITC investigation instituted in March "with respondents representing a significant share of top 10 modules currently imported into the United States" — a concrete enforcement action with an 11-month initial-determination clock. The tonal shift from "supply chain independence is valued" (defensive moat language) to active ITC litigation against named importers is the most assertive offensive move FSLR has taken in this cycle.

India repositioned from opportunistic to strategic pillar. Q2 framed India as a hedge being preserved for domestic demand; this quarter management states "in India, our presence reflects the same strategic logic that underpins our U.S. manufacturing investment, energy security, and supply chain independence…currently favors vertically integrated manufacturers such as First Solar." India is no longer the second-best alternative to SE Asia redirect — it is being framed as a parallel strategic platform with structurally favorable economics.

CURE has moved from milestone to operating mode. Q4 demoted CURE's 2026 margin contribution to "limited" with the bulk pushed to 2027–2028. This quarter management confirms "CURE is scheduled to be replicated across the Series 6 and 7 fleet through the first half of 2028" with up to $0.6B of contingent backlog adjuster value — same number, same timing, but now framed as a launched program executing rather than a future commitment. The de-risking is incremental.

Recurring themes management leaned on this quarter:

Domestic manufacturing reshoring and capacity optimizationTechnology differentiation through CURE efficiency gainsIP enforcement against Chinese silicon competitorsIndia market expansion as strategic supply chain hedgeSupply chain independence and Chinese decouplingMargin expansion through cost rationalization and tax credits

Risks management surfaced:

Pending 232 polysilicon derivatives tariff decision and outcomesProposed fiat rulemaking regulatory impactsInternational module ASP pressure and constrained demandTrade dynamics affecting international production utilizationSection 337 ITC investigation outcome uncertainty (11-15 months)

Q&A highlights

Brian Lee · Goldman Sachs

Asked about module gross margins remaining flat Q2 despite freight and warehousing tailwinds, and what drives H2 improvement. Also inquired about ASP trends, noting recent bookings appear higher at 36-37 cents vs. 35 cents blended.

Management explained Q2 flatness is due to Malaysia-Vietnam underutilization charges offsetting other benefits. H2 improvement driven by volume growth, fixed cost leverage, and tariff assumptions (Section 122 through July, no modeling beyond). India mix not materially impacting gross margin %. Recent bookings blended at 35 cents; half the 1.4GW call-to-call volume occurred post-quarter at same ASP. Additional 700MW in options tied to customer M&A activity.

7% module gross margin in Q1 (ex-45X benefit)Full year guide unchanged at 7% gross marginQ2 guidance flat vs. Q11.4GW booked since last call at $0.35/W blended ASP

Julian Dumoulin-Smith · Jefferies

Requested quantification of technology adders in 34-35% ASP range and future strategy for Southeast Asian capacity.

Management revealed adder structure is shifting with Cure launch. Historical adder entitlement ~3 cents, but blended average now ~1.5 cents as half of recent 1.4GW bookings had no adders (pricing full technology entitlement instead). Going forward, Cure contracts will be priced with all energy attributes embedded; adders diminishing. Malaysia-Vietnam capacity decision tied to 232 tariff policy clarity (expected Q2); maintaining as option pending outcome.

Historical adder entitlement: ~3 cents/wattRecent blended adder: ~1.5 cents/watt (50% of volume has zero adders)Half of 1.4GW bookings extend to 2029 (Cure product)Malaysia-Vietnam underutilization: 115-155M annually

Chris Dendrinos · RBC Capital Markets

Requested decision tree for Southeast Asia capacity expansion based on tariff outcomes and timing for long-term commitment.

Management outlined three scenarios: (1) full capacity operation shipping finished goods to U.S., (2) incremental U.S. finishing line added, or (3) capacity shutdown. Decision hinges on 232 outcome, supply availability, and ability to allocate tariff risk. All contingent on tariff policy certainty. Clarified that of original 7GW Southeast Asia capacity, 3.5GW goes to South Carolina as semi-finished, 1.8-2GW remains for standalone finished goods export (dependent on 232).

Three scenarios for Malaysia-Vietnam: full capacity export, add U.S. finishing line, or shutdownOriginal 7GW capacity split: 3.5GW to South Carolina finishing, 3.5GW remainingRemaining capacity further reduced: ~1.8-2GW available (balance redirected to Perrysburg perovskite pilot)232 decision timing: most likely Q2 2025

Phil Shen · Roth Capital Partners

Asked about 232 decision framework (e.g., minimum import price ~38 cents/W reported), timing confidence (Q2 vs. delays), and Cure/perovskite technology specs, costs, efficiency, durability.

On 232: framework remains in flux; engagement with administration on per-watt tariff or minimum import price structure receiving positive feedback, but outcome uncertain. Timing: Q2 remains target but with caveats ('end of quarter, move into early Q1 potentially'). On perovskite: pilot line (1GW) launching 2027 in Perrysburg; will be sub-optimized cost initially; evaluating single-junction vs. tandem, leaning toward single-junction for faster field validation and durability proof before complexity of tandem integration.

232 framework: per-watt tariff or minimum import price under consideration232 timing: Q2 target, but not committed ('things can always move')Perovskite pilot: 1GW capacity in 2027, not HVM-cost entitlementPerovskite strategy: likely single-junction launch for durability validation, tandem optionality later

Vikram Bagri · Citibank

Asked how quickly bookings can ramp post-232 announcement, how much pent-up demand exists, and what to monitor for post-232 volume inflection. Also asked on India capacity strategy: export vs. domestic focus given IPA repeal and 15% tariff.

On 232 demand: some multi-gigawatt customers waiting; pent-up demand exists but magnitude depends on 232 outcome and magnitude of tariff/price impact. If outcome lower than expected, ASP pressure; if higher, upside. Bid-ask currently reflects midpoint expectations. On India: strong domestic demand supports continued focus there through H1; gross margin on India product is highest including 45X benefits. Bringing 'tens to low 100s of megawatts' of semi-finished India product to U.S. in H1; uncertain on larger export pivot until tariff environment clarifies post-July 122 expiration.

Multi-gigawatt customer demand waiting for 232India gross margin: highest of all products (including 45X benefits)India volumes H1 strong, Q3 soft, Q4 recoveryBringing 10-100MW India semi-finished product to U.S. H1

Answers to last quarter's watch list

Q1 EBITDA print vs. $400–500M guide. Adjusted EBITDA landed at $520M, $20M above the high end of the preview range, with a 50% EBITDA margin. Operational execution beat the framework's first test cleanly. Status: Resolved positively

Section 232 polysilicon investigation outcome and any reciprocal-tariff resolution. Not resolved this quarter. Management's hedging language ("we expect an initial determination within approximately 11 months" on the related ITC case) and qualitative posture suggest the 232 decision continues to slip — what Q4 framed as a Q2 target is now soft. The underutilization carry continues to accrue. Status: Continue monitoring

CURE adjuster realization pace. No quantification of 2026 CURE adjuster realization disclosed in the print. The $0.6B contingent value is reaffirmed but explicitly remains "majority anticipated in 2027 and 2028" — the timing pushed in Q4 has not moved back. Status: Continue monitoring

Perovskite pilot line milestones. This quarter confirms a 1 GW pilot line at Perrysburg targeted for 2027, leveraging back-end tools redeployed from SE Asia and existing Perrysburg facility space. Single-junction vs. tandem construct still under evaluation. The commitment is now concrete but management explicitly flagged sub-optimal cost economics at pilot scale. Status: Continue monitoring

Gross bookings cadence. Backlog fell to 47.9 GW from 50.1 GW at YE2025 — a 2.2 GW decline. Q1 shipments of 3.8 GW against gross bookings of 1.7 GW (and 0.1 GW de-bookings) reconciles the gap, with bookings well below the shipment pace needed to hold backlog flat. This validates the "selective contracting masks demand softness" thesis. Status: Resolved negatively

Working capital and 45X discount. Net cash declined to $2.0B from $2.4B at YE2025 — a $400M decline in Q1 against $520M of EBITDA, consistent with working capital build and capex for the South Carolina facility. No widening of the 45X discount was disclosed. Status: Continue monitoring

What to watch into next quarter

Section 232 decision timing and substance. Management's Q1 framing ("Q2 target" with hedge) was the third quarter in a row pointing at "next quarter." A decision that lands in Q2 with per-watt or minimum-import-price structure would validate the underutilization carry; further slippage into H2 forces the question of whether the SE Asia option is still worth the absorbed cost.

Q2 EBITDA print vs. $400–500M and the implied H2 acceleration. Q2 midpoint of $450M implies H2 quarterly EBITDA of $815–915M — a step function. Any Q2 print below $400M makes the FY $2.6–2.8B reaffirmation arithmetically harder and forces a midyear cut.

Gross bookings cadence. With backlog at 47.9 GW and Q1 bookings of 1.7 GW vs. 3.8 GW shipped, the gap needs to close. A Q2 bookings update below ~3.8 GW gross would confirm Q1 was not a timing anomaly and validates further backlog erosion.

45X monetization rate. Q2 45X guide of $330–400M is 75–90% of the EBITDA range; any disclosed discount widening compresses realized cash EBITDA materially.

ITC Section 337 procedural milestones. Initial determination expected within ~11 months; any early procedural rulings on respondents or scope are inputs to the moat-from-litigation thesis.

South Carolina facility production start (H2 2026). Equipment installation began this quarter per the transcript and production start remains on track for H2 2026; any indication of slippage would push the SE Asia front-end consolidation into 2028 and extend the underutilization drag.

Sources

First Solar Q1 2026 press release (SEC EX-99.1): https://www.sec.gov/Archives/edgar/data/1274494/000127449426000108/ex991pressreleaseq1-2026.htm
First Solar Q1 2026 earnings call transcript (prepared remarks and Q&A).
First Solar Q4 2025 Tapebrief (FY2026 guidance baseline and prior watch list).
First Solar Q3 2025 Tapebrief (backlog and BP termination context).
First Solar Q2 2025 Tapebrief (tariff and bookings cadence context).

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