Enphase sees substantial solar growth in Europe as raw gas costs soar

Enphase sees substantial solar growth in Europe as raw gas costs soar

July 28, 2022: -Enphase Energy’s second-quarter results were boosted by solid growth out of Europe, which soars natural gas prices and prompts consumers to go solar.

Shares of the company, supplying solar energy components and battery systems, increased over 9% during the trading Tuesday after Enphase beat revenue estimates for the second quarter.

Presently, the U.S. makes up approximately 80% of Enphase’s revenue. But CEO Badri Kothandaraman is seeing that changing fast.

“Maybe in two years from today, that number will get closer to 50/50,” he told CNBC, with Europe which accounts for the bulk of international revenue.

This opportunity for growth comes as Europe scrambles to rejigger its energy system to move away from Russian fuel.

On Tuesday, the bloc agreed to reduce gas consumption by 15% voluntarily. The region has pledged to ramp up its renewable energy infrastructure.

But in the meantime, fuel prices are surging. On Tuesday, Dutch TTF natural gas futures jumped 19.8% to 211.70 euros per megawatt hour, the highest level since March.

According to Argus Media, that is equivalent to about $63 per million British thermal units (MMBtu), which is how U.S. natural gas is priced.

To put the action in perspective, U.S. natural gas futures touched $9.75 per MMBtu on Tuesday, the highest level since 2008 but significantly below European prices.

Kothandaraman expects revenue from Europe to grow one more 40% during the review quarter.

“We are expanding the team. We expect this momentum to continue,” he said on the company’s earnings call.

Enphase sees demand growth from the U.S., where utility bills are increasing. Increasingly frequent grid outages prompt consumers to want energy independence.

Total revenue for the company, making microinverters and backup energy storage for solar systems, increased 20% quarter more than quarter to a record $530 million. Gross margins increased quarter over quarter from 40.1% to 41.3%.

Enphase provides an upbeat outlook for the current quarter, with a revenue range of $590 million to $630 million. According to estimates compiled by Street Account, Wall Street was screaming for $550.5 million.

The industry has faced several challenges in contemporary months, including supply chain issues, increasing raw material costs, and policy uncertainty.

Editor's Choice

Posts You Might Like

A Resilient & Innovative Leader | Maushum Basu

Maushum Basu is a visionary leader who inspires his team with a clear, compelling purpose. Unafraid to take calculated risks, he understands that growth often stems from change and innovation. His deep commitment to both Airia Brands, Inc.

Directing with Courage & Precision | Martin Paquette

When speaking with Martin Paquette, one thing is immediately apparent: he’s honest. His transparency is refreshing. While many shy away from such vulnerability, Paquette sees it as a force to reckon with. The incredible emotional intelligence speaks to years of looking within—it’s also what allows him to acknowledge his mistakes gracefully and use them as opportunities to innovate.

An Innovative Thinker | Marina Charriere

Marina Charriere, CEO of Star Drug Testing Services, Star Drug Testing Services (Windsor Park), and First Defence Face Masks go hand in hand. Star is a drug and alcohol testing facility, and First D F M is a face mask company.

A Pioneer of Food Technology | Lejjy Gafour

Lejjy Gafour, CEO, CULT Food Science Corp. Lejjy is a self-taught entrepreneur and experienced company operator who made his start creating opportunities at the young age of 14, and he has been working, leading, and building businesses ever since.

The-corporate-magazine-15

Leave us a message

Subscribe

Fill the form our team will contact you

Advertise with us

Fill the form our team will contact you​