Nextracker Reports Q3 FY25 Financial Results

About this update from Nextpower Inc.

Reaffirms FY25 Revenue Outlook and Raises FY25 Profit Outlook FREMONT, Calif. --(BUSINESS WIRE)-- Nextracker (Nasdaq: NXT), a global market leader of intelligent solar trackers, foundations, and software solutions, today announced financial results for the third quarter of fiscal year 2025, ended December 31, 2024 . Financial Summary (In millions, except per share) Q3 FY25* Q2 FY25* Q3 FY24 Revenue $679 $636 $710 GAAP Gross Profit $241 $225 $210 GAAP Gross Margin 35.5% 35.4% 29.5% GAAP Net Income $117 $117 $128 GAAP Net Income Margin 17.3% 18.5% 18.0% GAAP Diluted EPS $0.79 $0.79 $0.87 Adjusted Gross Profit $245 $228 $212 Adjusted Gross Margin 36.0% 35.9% 29.9% Adjusted EBITDA $186 $173 $168 Adjusted EBITDA Margin 27.4% 27.2% 23.6% Adjusted Net Income $154 $145 $142 Adjusted Diluted EPS $1.03 $0.97 $0.96 *Q3 FY25 and Q2 FY25 GAAP and adjusted results include approximately $52 million and $51 million , respectively, of IRA 45X advanced manufacturing tax credit vendor rebates (“45X credits”). Q3 FY24 results do not include 45X credits. Please refer to Nextracker’s most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K for more information on 45X credits and schedules III, IV and V attached to this press release for a reconciliation of non-GAAP to GAAP financial measures. Additional information can be found on the Investor Relations section of our website. Business Highlights Record backlog increased to significantly greater than $4.5 billion , supported by robust demand in all key regions for the company with meaningful contributions from new products Expanded manufacturing and supply chain network to over 70 manufacturing partners operating more than 90 facilities across 19 countries, totaling over 50 GW/year of capacity, enabling local content with superior on-time delivery and customer satisfaction Shipped the first 100% U.S. domestic content solar trackers* Deployed newly launched products and features at scale, including: NX Horizon Hail Pro™ : Industry-leading 75-degree stow capability to mitigate against hail risk NX Horizon Hail Pro™: Automated stowing for proactive storm response NX Horizon-XTR™: Feature doubles XTR's ability to conform to sloping terrain NX-Anchor™ : Advanced foundations solutions solving challenging geotechnical conditions Launched significant expansion of R&D and innovation capability: Expanded U.S. R&D facility and Customer Center of Excellence Partnered with UC Berkeley and launched CAL-NEXT Center for Solar Energy Research , a $6.5 million commitment to advance solar technology Inaugurated the India R&D Center for Solar Excellence in Hyderabad Expanded Center for Solar Excellence in Brazil *Per U.S. Treasury Guidance “We’re very pleased with the company’s execution, delivering record revenue and profit year-to-date driven by strong demand,” said Dan Shugar , founder and CEO of Nextracker . “In the quarter, we successfully deployed several of our newly launched products and features at scale, expanding our total addressable market. In addition, we continue to increase our investment in R&D to drive rapid customer centric innovation ensuring our solutions remain at the forefront of solar technology while driving value for stakeholders worldwide.” “Our strong year-to-date financial performance, coupled with our growth in backlog enables us to raise our FY25 profit outlook,” said Chuck Boynton , CFO of Nextracker . “The company is on incredibly solid financial footing with $418 million of operating cash flow year-to-date, ending the quarter with over $693 million in cash and equivalents.” FY2025 Annual Outlook Reaffirms FY25 revenue outlook and raises FY25 profit outlook Updated Outlook Previous Outlook Revenue $2.8 to $2.9 billion $2.8 to $2.9 billion GAAP Net Income $467 to $497 million $378 to $408 million GAAP Diluted EPS $3.11 to $3.31 $2.50 to $2.70 Adjusted EBITDA $700 to $740 million $625 to $665 million Adjusted Diluted EPS $3.75 to $3.95 $3.10 to $3.30 Adjusted EBITDA and adjusted diluted EPS exclude approximately $120 million and $0.64 , respectively, for stock-based compensation, acquisition related costs and net intangible amortization. Q3 FY2025 Earnings Call January 28, 2025 2:00 p.m. PT / 5:00 p.m. ET Live webcast available on investors.nextracker.com We encourage you to review our Q3 FY25 Shareholder Letter, which, along with this press release, is available on the Nextracker Investor Relations website and includes important information for Nextracker shareholders that supplements and expands on the information in this press release. The webcast replay will be available on the Nextracker Investor Relations website following the conclusion of the event. Upcoming Events On March 4 , Chuck Boynton , Nextracker Chief Financial Officer, will participate in a fireside chat at the Jefferies Power , Utilities and Clean Energy Conference . About Nextracker Nextracker is a leading provider of integrated solar trackers, foundations, and software solutions used in ground-mounted utility-scale and distributed generation solar projects around the world. Our product portfolio enables solar PV power plants to follow the sun’s movement across the sky and optimize plant performance. With power plants operating in more than forty countries worldwide, Nextracker offers solar tracker technologies that increase energy production while reducing costs for significant plant ROI. For more information, please visit www.nextracker.com . Forward Looking Statements This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the trends for future solar adoption, the expected benefits of the Ojjo, Inc. and Solar Pile International acquisitions, the expected benefits of our new product launches, such as Hail Pro-75, Hail Pro Automated Stowing, XTR 1.5 and NX-Anchor, our domestic content capabilities, the expected benefits from the expansion of our R&D facilities, initiatives and capabilities, and Nextracker’s outlook for fiscal 2025 and other periods. These forward-looking statements are based on various assumptions and on the current expectations of Nextracker’s management. These statements involve risks and uncertainties that could cause the actual results to differ materially from those anticipated by these forward-looking statements, including risks and uncertainties that are described under “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Nextracker’s most recent Quarterly Report on Form 10-Q, Annual Report on Form 10-K and other documents that Nextracker has filed or will file with the Securities and Exchange Commission . There may be additional risks that Nextracker is not aware of or that Nextracker currently believes are immaterial that could also cause actual results to differ from the forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements. Nextracker assumes no obligation to update these forward-looking statements. Use of Adjusted Financial Information An explanation and reconciliation of non-GAAP financial measures to GAAP financial measures is presented in Schedules III, IV and V attached to this press release, and can be found, along with other financial information including the Earnings Presentation, on the investor relations section of our website at investors.nextracker.com . Channels for Disclosure of Information Nextracker intends to announce material information to the public through the Nextracker Investor Relations website investors.nextracker.com , SEC filings, press releases, public conference calls, and public webcasts. Nextracker uses these channels to communicate with its investors, customers, and the public about the company, its offerings, and other issues. As such, Nextracker encourages investors, the media, and others to follow the channels listed above and to review the information disclosed through such channels. Schedule I Nextracker Inc. Unaudited condensed consolidated statements of operations and comprehensive income (In thousands, except per share data) Three-month periods ended December 31, 2024 September 27, 2024 December 31, 2023 Revenue $ 679,363 $ 635,571 $ 710,426 Cost of sales 438,460 410,776 500,701 Gross profit 240,903 224,795 209,725 Selling, general and administrative expenses 70,573 72,127 48,356 Research and development 20,094 19,193 12,897 Operating income 150,236 133,475 148,472 Interest expense 3,798 3,665 3,227 Other income, net (13,778 ) (7,382 ) (21,534 ) Income before income taxes 160,216 137,192 166,779 Provision for income taxes 42,842 19,928 38,818 Net income and comprehensive income 117,374 117,264 127,961 Less: Net income attributable to non-controlling interests and redeemable non-controlling interests 2,091 1,873 86,565 Net income attributable to Nextracker Inc. $ 115,283 $ 115,391 $ 41,396 Earnings per share attributable to Nextracker Inc. common stockholders Basic $ 0.80 $ 0.80 $ 0.67 Diluted $ 0.79 $ 0.79 $ 0.87 Weighted-average shares used in computing per share amounts: Basic 143,664 143,479 62,109 Diluted 149,028 149,079 147,344 Nextracker Inc. Unaudited condensed consolidated statements of operations and comprehensive income (continued) (In thousands, except per share data) Nine-month periods ended December 31, 2024 December 31, 2023 Revenue $ 2,034,855 $ 1,763,326 Cost of sales 1,331,717 1,290,747 Gross profit 703,138 472,579 Selling, general and administrative expenses 203,527 126,865 Research and development 55,806 29,270 Operating income 443,805 316,444 Interest expense 10,743 9,975 Other income, net (16,292 ) (18,464 ) Income before income taxes 449,354 324,933 Provision for income taxes 89,922 51,918 Net income and comprehensive income 359,432 273,015 Less: Net income attributable to non-controlling interests and redeemable non-controlling interests 7,058 171,937 Net income attributable to Nextracker Inc. $ 352,374 $ 101,078 Earnings per share attributable to Nextracker Inc. common stockholders Basic $ 2.46 $ 1.78 Diluted $ 2.41 $ 1.86 Weighted-average shares used in computing per share amounts: Basic 143,102 56,789 Diluted 149,134 147,160 Schedule II Nextracker Inc. Unaudited condensed consolidated balance sheets (In thousands) As of December 31, 2024 As of March 31, 2024 ASSETS Current assets: Cash and cash equivalents $ 693,543 $ 474,054 Accounts receivable, net of allowance of $2,845 and $3,872 , respectively 457,918 382,687 Contract assets 279,027 397,123 Inventories 217,301 201,736 Other current assets 346,732 312,635 Total current assets 1,994,521 1,768,235 Property and equipment, net 47,985 9,236 Goodwill 370,613 265,153 Other intangible assets, net 47,503 1,546 Deferred tax assets 472,189 438,272 Other assets 50,748 36,340 Total assets $ 2,983,559 $ 2,518,782 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 377,466 $ 456,639 Accrued expenses 72,863 82,410 Deferred revenue 297,007 225,539 Current portion of long-term debt 6,563 3,750 Other current liabilities 150,746 123,148 Total current liabilities 904,645 891,486 Long-term debt, net of current portion 138,770 143,967 Tax receivable agreement (TRA) liability 375,002 391,568 Other liabilities 140,182 99,733 Total liabilities 1,558,599 1,526,754 Total stockholders’ equity 1,424,960 992,028 Total liabilities and stockholders’ equity $ 2,983,559 $ 2,518,782 Schedule III Nextracker Inc. Unaudited condensed consolidated statements of cash flows (In thousands) Nine-month periods ended December 31, 2024 December 31, 2023 Cash flows from operating activities: Net income $ 359,432 $ 273,015 Depreciation and amortization of intangible assets 8,299 3,138 Changes in working capital and other, net 50,736 41,328 Net cash provided by operating activities 418,467 317,481 Cash flows from investing activities: Purchases of property and equipment (23,841 ) (3,850 ) Payment for business acquisitions, net of cash acquired (144,675 ) — Net cash used in investing activities (168,516 ) (3,850 ) Cash flows from financing activities: Repayment of bank borrowings (2,813 ) (2,813 ) Net proceeds from issuance of Class A shares — 552,009 Purchase of LLC common units from Yuma, Inc. — (552,009 ) Payment of revolver issuance costs (6,017 ) — TRA payment (15,520 ) — Distribution to non-controlling interest holders (6,112 ) (64,365 ) Net transfers to Flex — (8,335 ) Other financing activities — (308 ) Net cash used in financing activities (30,462 ) (75,821 ) Net increase in cash and cash equivalents 219,489 237,810 Cash and cash equivalents beginning of period 474,054 130,008 Cash and cash equivalents end of period $ 693,543 $ 367,818 Nine-month periods ended Adjusted free cash flow December 31, 2024 December 31, 2023 Net cash provided by operating activities $ 418,467 $ 317,481 Purchases of property and equipment (23,841 ) (3,850 ) Adjusted free cash flow $ 394,626 $ 313,631 Schedule IV Nextracker Inc. Reconciliation of GAAP to Non-GAAP financial measures (In thousands, except percentages and per share data) Three-month periods ended December 31, 2024 September 27, 2024 December 31, 2023 GAAP gross profit & margin $ 240,903 35.5 % $ 224,795 35.4 % $ 209,725 29.5 % Stock-based compensation expense 3,084 2,481 2,497 Intangible amortization 880 896 63 Adjusted gross profit & margin $ 244,867 36.0 % $ 228,172 35.9 % $ 212,285 29.9 % GAAP operating income & margin $ 150,236 22.1 % $ 133,475 21.0 % $ 148,472 20.9 % Stock-based compensation expense 26,980 29,885 13,037 Intangible amortization 1,780 1,875 63 Acquisition related costs 1,038 2,177 — Adjusted operating income & margin $ 180,034 26.5 % $ 167,412 26.3 % $ 161,572 22.7 % GAAP net income & margin $ 117,374 17.3 % $ 117,264 18.5 % $ 127,961 18.0 % Stock-based compensation expense 26,980 29,885 13,037 Intangible amortization 1,780 1,875 63 Adjustment for taxes 6,550 (6,274 ) 841 Acquisition related costs 1,038 2,177 — Adjusted net income & margin $ 153,722 22.6 % $ 144,927 22.8 % $ 141,902 20.0 % GAAP net income & margin $ 117,374 17.3 % $ 117,264 18.5 % $ 127,961 18.0 % Interest, net (1,865 ) 455 (198 ) Provision for income taxes 42,842 19,928 38,818 Depreciation expense 2,636 1,067 1,055 Intangible amortization 1,780 1,875 63 Stock-based compensation expense 26,980 29,885 13,037 Acquisition related costs 1,038 2,177 — Other tax related income, net (4,413 ) — (12,945 ) Adjusted EBITDA & margin $ 186,372 27.4 % $ 172,651 27.2 % $ 167,791 23.6 % Diluted earnings per share GAAP $ 0.79 $ 0.79 $ 0.87 Earnings per share attributable to Non-GAAP adjustments 0.24 0.18 0.09 Adjusted $ 1.03 $ 0.97 $ 0.96 Diluted shares used in computing per share amounts 149,028 149,079 147,344 Nextracker Inc. Reconciliation of GAAP to Non-GAAP financial measures (continued) (In thousands, except percentages and per share data) Nine-month periods ended December 31, 2024 December 31, 2023 GAAP gross profit & margin $ 703,138 34.6 % $ 472,579 26.8 % Stock-based compensation expense 9,345 7,668 Intangible amortization 1,864 188 Adjusted gross profit & margin $ 714,347 35.1 % $ 480,435 27.2 % GAAP operating income & margin $ 443,805 21.8 % $ 316,444 17.9 % Stock-based compensation expense 78,766 39,895 Intangible amortization 3,743 188 Acquisition related costs 4,695 — Adjusted operating income & margin $ 531,009 26.1 % $ 356,527 20.2 % GAAP net income & margin $ 359,432 17.7 % $ 273,015 15.5 % Stock-based compensation expense 78,766 39,895 Intangible amortization 3,743 188 Adjustment for taxes (9,368 ) (4,040 ) Acquisition related costs 4,695 — Adjusted net income & margin $ 437,268 21.5 % $ 309,058 17.5 % GAAP net income & margin $ 359,432 17.7 % $ 273,015 15.5 % Interest, net (2,702 ) 1,136 Provision for income taxes 89,922 51,918 Depreciation expense 4,556 2,950 Intangible amortization 3,743 188 Stock-based compensation expense 78,766 39,895 Acquisition related costs 4,695 — Other tax related income, net (4,413 ) (7,259 ) Adjusted EBITDA & margin $ 533,999 26.2 % $ 361,843 20.5 % Diluted earnings per share GAAP $ 2.41 $ 1.86 Earnings per share attributable to Non-GAAP adjustments 0.52 0.24 Adjusted $ 2.93 $ 2.10 Diluted shares used in computing per share amounts 149,134 147,160 See the accompanying notes on Schedule V attached to this press release Schedule V Nextracker Inc. Notes To supplement Nextracker’s unaudited selected financial data presented consistent with U.S. Generally Accepted Accounting Principles (“GAAP”), the Company discloses certain non-GAAP financial measures that exclude certain charges and gains, including adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA”), adjusted EBITDA margin, adjusted gross profit, adjusted gross margin, adjusted operating income, adjusted net income, adjusted diluted earnings per share, and adjusted free cash flow. These supplemental measures exclude certain legal and other charges, stock-based compensation expense and intangible amortization, other discrete events as applicable and the related tax effects. These non-GAAP measures are not in accordance with or an alternative for GAAP and may be different from non-GAAP measures used by other companies. We believe that these non-GAAP measures have limitations in that they do not reflect all the amounts associated with Nextracker’s results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Nextracker’s results of operations in conjunction with the corresponding GAAP measures. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the most directly comparable GAAP measures. We compensate for the limitations of non-GAAP financial measures by relying upon GAAP results to gain a complete picture of the Company’s performance. In calculating non-GAAP financial measures, we exclude certain items to facilitate a review of the comparability of the Company’s operating performance on a period-to-period basis because such items are not, in our view, related to the Company’s ongoing operational performance. We use non-GAAP measures to evaluate the operating performance of our business, for comparison with forecasts and strategic plans, for calculating return on investment, and for benchmarking performance externally against competitors. In addition, management’s incentive compensation is determined using certain non-GAAP measures. Since we find these measures to be useful, we believe that investors benefit from seeing results “through the eyes” of management in addition to seeing GAAP results. We believe that these non-GAAP measures, when read in conjunction with the Company’s GAAP financials, provide useful information to investors by offering: the ability to make more meaningful period-to-period comparisons of the Company’s ongoing operating results; the ability to better identify trends in the Company’s underlying business and perform related trend analysis; a better understanding of how management plans and measures the Company’s underlying business; and an easier way to compare the Company’s operating results against analyst financial models and operating results of competitors that supplement their GAAP results with non-GAAP financial measures. The following are explanations of each of the adjustments that we incorporate into non-GAAP measures, as well as the reasons for excluding each of these individual items in the reconciliations of these non-GAAP financial measures: Stock-based compensation expense consists of non-cash charges for the estimated fair value of unvested restricted share unit and stock option awards granted to employees. The Company believes that the exclusion of these charges provides for more accurate comparisons of its operating results to peer companies due to the varying available valuation methodologies, subjective assumptions, and the variety of award types. In addition, the Company believes it is useful to investors to understand the specific impact stock-based compensation expense has on its operating results. Intangible amortization consists primarily of non-cash charges that can be impacted by, among other things, the timing and magnitude of acquisitions. The Company considers its operating results without these charges when evaluating its ongoing performance and forecasting its earnings trends, and therefore excludes such charges when presenting non-GAAP financial measures. The Company believes that the assessment of its operations excluding these costs is relevant to its assessment of internal operations and comparisons to the performance of its competitors. The 45X Advanced Manufacturing Production Tax Credit (“45X Credit”) which was established as part of the Inflation Reduction Act (IRA), is a per-unit tax credit earned over time for each clean energy component domestically produced and sold by a manufacturer. The 45X Credit was eligible for domestic parts manufactured after January 1, 2023 . The Company has executed agreements with certain suppliers to ramp up its U.S. manufacturing footprint. These suppliers produce 45X Credit eligible parts, including torque tubes, and structural fasteners, that will then be incorporated into a solar tracker. The Company has contractually agreed with these suppliers to share a portion of the credit related to Nextracker’s purchases. The Company accounts for these credits as a reduction of the purchase price of the parts acquired from the vendor and therefore a reduction of inventory until the part is sold, at which point the Company recognizes such credit as a reduction of cost of sales on the unaudited condensed consolidated statements of operations and comprehensive income. During the fourth quarter of fiscal 2024, the Company determined the amount of the 45X vendor rebates it expects to receive in accordance with the vendor contracts and recognized a cumulative reduction to cost of sales of $121.4 million related to 45X Credit vendor rebates earned on production of eligible components shipped to projects starting on January 1, 2023 through March 31, 2024 . The Company believes that the assessment of its operations excluding the benefit from the vendor credits provides a more consistent comparison of its performance given the cumulative nature of the amount recorded in the fiscal fourth quarter. Beginning in the first quarter of fiscal year 2025, these 45X credit vendor rebates are not excluded from our non-GAAP financial measures. Acquisition costs consist primarily of nonrecurring transaction costs for business acquisitions. Adjustment for taxes relates to the tax effects of the various adjustments that we incorporate into non-GAAP measures to provide a more meaningful measure on non-GAAP net income and certain adjustments related to non-recurring settlements of tax contingencies or other non-recurring tax charges, when applicable. View source version on businesswire.com : https://www.businesswire.com/news/home/20250128806082/en/ Investor Contact: Sarah Lee [email protected] Media Contact: Brandy Lee [email protected] Source: Nextracker

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