First Solar hikes Capex for solar module capacity expansion

By Editor


First Solar has revealed that there will be a revision in its capital expenditure (capex) to $1.8 billion – $2 billion in 2024 against prior guidance of $1.7 billion – $1.9 billion.

First Solar’s capital expenditures were $413 million in Q1 2024.

“We’re increasing our capital expenditures forecast by $0.1 billion with the intention of accelerating the CuRe conversion at our Vietnam facilities, as well as at our third Perrysburg facility,” Alex Bradley, Chief Financial Officer of First Solar, in its earnings report.

First Solar said sales for the first quarter were $794 million against $548 million in Q1 2023 and $1,159 million in Q4 2023. First Solar has produced 3.6 gigawatts of solar modules in Q1.

First Solar’s gross margin was 44 percent in the first quarter compared to 43 percent in the fourth quarter of 2023. This increase was primarily driven by a higher mix of modules sold from US factories, which qualify for Section 45X tax credits, partially offset by higher warehousing and logistics costs in India and the US.

First Solar expects to exit 2024 with over 21 gigawatts of global nameplate capacity and 2026 with over 25 gigawatts of nameplate capacity. All of this capacity is available to serve the US market with over half of our capacity physically located in the US.

First Solar has bookings of 2.7 GW with an average selling price (ASP) of $0.31 per watt. Total contracted backlog stands at 78.3 gigawatts with an aggregate value of $23.3 billion with orders stretching through 2030.

First Solar is targeting sales of $4.4 billion to $4.6 billion in 2024.

“We are pleased with our start to 2024, with good operating performance, selective bookings with a year to date ASP over 31 cents per watt excluding adjusters, and solid financial results,” said Mark Widmar, CEO of First Solar. “Our differentiated technology and balanced business model are enabling us to drive growth, navigate industry volatility and deliver enduring shareholder value.”

First Solar said it is on track to commission R&D innovation center and a perovskite development line in Ohio in the second half of this year, representing a combined investment of nearly $0.5 billion.

The large Chinese solar manufacturing facility reportedly had a record-low capacity utilization rate of 23 percent in February of this year.

In contrast, First Solar said its facilities were operating near nameplate capacity in the first quarter of this year. The Chinese solar industry has engaged in a race to the bottom with a rationally low market-distorting pricing that has caused even Chinese companies to call for intervention by the Chinese government to manage the pricing environment.

First Solar has revealed that the mid- to late-stage bookings opportunities decreased by approximately 2.6 gigawatts to 29.4 gigawatts and now includes 25.8 gigawatts in North America and 3.2 gigawatts in India. Included within mid- to late-stage pipeline are 3.7 gigawatts of opportunities that are connected subject to conditions, which includes 1 gigawatt in India.

Baburajan Kizhakedath

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