Sunworks Announces Third Quarter 2023 Results

PROVO, UT / ACCESSWIRE / November 10, 2023 / Sunworks, Inc. (NASDAQ:SUNW), a leading provider of solar power, battery storage, and electric vehicle charging solutions for residential, agriculture, commercial, industrial, and public works markets, today announced financial results for the three months ended September 30, 2023.

THIRD QUARTER 2023 RESULTS
(As compared to the Third Quarter 2022)

• Total revenue of $28.7 million, a 29.5% decline
• Residential Solar segment revenue of $20.3 million, a 44.5% decline
• Commercial Solar Energy segment revenue of $8.3 million, a 105.9% increase
• Total backlog of $66.5 million, a 39.7% decline

For the three months ended September 30, 2023, Sunworks reported total revenue of $28.7 million, versus $40.7 million in the prior-year period. The Company reported a net loss of ($36.4) million in the third quarter of 2023, or ($0.84) per share, versus a net loss of ($5.4) million in the prior-year period, or ($0.16) per share. The third quarter 2023 net loss includes a ($26.0) million, or ($.60) per share, non-cash impairment of goodwill.

Adjusted EBITDA was a loss of $8.5 million in the third quarter 2023, compared to a loss of $3.7 million in the third quarter 2022. A reconciliation of GAAP to non-GAAP financial measures is provided in the appendix of this release.

MARKET UPDATE

Demand conditions within Sunworks' Commercial Solar Energy segment remain healthy. Over the past 18 months, the Company set a long-term strategy of diversifying its customer base and developing relationships with multi-site commercial entities. While order timing may depend on jurisdictional approval and other external factors, indications of interest from commercial entities and public works entities are at elevated levels. In the third quarter, Commercial Solar Energy segment revenue increased 12.2% sequentially and 105.9% on year over year basis.

Following strong residential origination activity in the first quarter, demand conditions in the Residential Solar Energy segment began to weaken in the second quarter and continued to decline in the current quarter. An increase in interest rates and lower activity levels in California following the net energy metering "NEM" 3.0 transition are driving lower residential solar adoption. In response to the demand decline, the Company has lowered headcount and exited several underperforming markets. The Company is focusing sales and marketing efforts in a smaller regional footprint to drive scale and operating efficiencies. In the third quarter, Residential Solar segment revenue declined 25.2% sequentially and 44.5% on a year over year basis.