First Solar has announced financial results for the third quarter of 2026, reporting $1.23 billion in net sales, a 58% gross margin and $571 million in net income.
While net sales declined 23% year-over-year due to lower volumes of modules sold to third parties, the company’s gross margin was roughly 20 percentage points higher than the same figure for the third quarter of 2025, and net income rose 25% year-over-year. The company also authorized a new $500 million stock buyback.
Due to the slowdown in sales, the company reduced its full-year volume sold forecast to between 16.0 GW and 17.0 GW and lowered its full-year 2026 net sales guidance to between $4.6 billion and $4.9 billion, down from the $4.9 billion to $5.2 billion it reported after Q2.
On the company’s third-quarter earnings call, executives outlined how First Solar is adjusting its commercial and operational strategy following the August Section 232 tariff proclamation. The call and following Q&A focused on a number of important topics, including a forthcoming “binary decision” on the future of First Solar’s 1.8 GW Malaysia factory, investments in perovskite technology and how upcoming modules built with the company’s CuRe technology stack up against crystalline silicon PERC and TOPCon competitor in cost.
Management also provided comments on ongoing legal disputes regarding the company’s TOPCon intellectual property and a recent warranty lawsuit filed by developer Swift Current Energy.On the earnings call, company CEO Mark Widmar said First Solar will soon file its formal legal response in the Swift Current case and maintained that the company’s warranty terms govern any remediation.
“We will stand by and we will support under the parameters of our limited liability warranty the obligations that we have,” Widmar said. “Where people are asking for remedies that are outside the parameters of the warranty, that’s not something that we will do.”
Just before the call, First Solar announced a non-exclusive patent licensing agreement with perovskite company CubicPV, adding the rights to use the IP to its existing agreement with Oxford PV. The company plans to begin producing Series 6-form-factor perovskite modules for field testing and durability validation from its Perrysburg, Ohio facility in the first half of 2027.
Contracting strategy vs. the spot market
First Solar closed the third quarter with a contracted backlog of 44 GW valued at approximately $13.5 billion, with deliveries scheduled through 2030. In the time since its second-quarter update, the company says it recorded 1.4 GW of U.S. bookings at an average selling price of about 36 cents per watt.
Despite the slower pace of new bookings, CFO Alex Bradley emphasized that the company is planning to avoid selling to the spot market for its international volume and is instead pivoting toward project-specific contracts with defined delivery schedules rather than the multi-year framework agreements across multiple projects for very large customers for which First Solar is known.
“We don’t want to be in the spot market. That’s a challenging place for us to be,” Bradley said on the call. “If we move to more of a project-based model, where there is a certainty around an individual project, the timing of that project and delivery schedule, that allows me to plan on the operational side much more efficiently.”
Bradley added that project-specific contracting helps reduce working capital requirements and warehousing costs, even if it slows the rate at which multi-year backlog is added.
Pricing and Section 232 concerns
Widmar described the August Section 232 proclamation as “a meaningful shift for U.S. solar manufacturing,” and noted that nearly 80% of First Solar’s global manufacturing footprint will be located in the United States by 2027.
“Section 232 represents a structural change in how the United States approaches solar manufacturing,” the CEO said. “As a technology company and the only fully integrated utility-scale solar manufacturer without dependency on a Chinese crystalline silicon supply chain, we believe we are structurally positioned to benefit from this environment.”
Still, the company says near-term procurement and price discovery have been slowed by several market pressures. Widmar noted that developers are holding back on module procurement for 2029 and 2030 as they navigate through challenges with interconnection and pushback from local communities around data center deployment, wait for further guidance around Foreign Entity of Concern (FEOC) rules and face uncertainty around how Section 232 minimum import prices and anti-stockpiling rules will be enforced.
A binary decision in Malaysia
Those trade and tariff pressures have weighed most heavily on First Solar’s international Series 6 production in Southeast Asia. While the company’s Vietnam facility is slated to supply semi-finished Series 6 modules to its newly inaugurated South Carolina finishing plant, its Malaysia factory continues to produce finished international modules.
Widmar said the company expects to make a “binary” operational decision on the Malaysia facility in the first half of 2027: either run the plant at full or near-full capacity, or shut down production altogether. Because modules produced in Malaysia do not qualify for U.S. Section 45X manufacturing tax credits and face freight and tariff costs, the company says it does not expect either outcome to materially affect its run-rate earnings profile.
This content is protected by copyright and may not be reused. If you want to cooperate with us and would like to reuse some of our content, please contact: [email protected].
Comments
Please login to comment
Monday, November 2, 2026
4:00 pm – 5:00 pm CEST, Berlin, Paris, Madrid
Thursday, November 5, 2026
10:00 am – 11:00 pm CEST, Berlin, Paris, Madrid
You have no items in your basket.
