Israel-based solar inverter manufacturer SolarEdge reported revenue of $326.08 million in the third quarter (Q3) of 2026, declining 4.1% year-over-year (YoY) from $340.18 million, missing analysts’ expectations by $890,040.

The adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) stood at $31.75 million, compared with an adjusted negative EBITDA of $14.09 million a year earlier.

The company narrowed its net loss by 83.3% to $8.385 million from $50.06 million. Loss per share was $0.14, compared with $0.84 in Q3 2025.

Earnings per share came in at -$0.14, compared with -$0.84 in Q3 2025. It missed analysts’ expectations by $0.25.

SolarEdge attributed the quarter’s performance to weak U.S. residential solar demand and seasonal softness in Europe. Higher battery storage sales and adoption of its Nexis platform supported revenue, while tariff refunds, U.S. manufacturing tax credits, and cost controls improved margins.

In Q2 2026, SolarEdge reported revenue of $346.2 million, a 19.6% YoY increase from $289.4 million and surpassing analysts’ expectations by $5.08 million.

9M Results

Revenue for the first nine months (9M) of 2026 rose 15.8% YoY to $982.822 million from $849.086 million.

The company narrowed its loss by 64.7% to $96.5 million from $273.33 million.

Business Updates

SolarEdge’s Nexis platform generated more than $100 million in revenue during Q3. The company reported growing adoption of its three-phase Nexis solution in Europe and began rolling out the platform in the U.S. in July 2026.

SolarEdge said it maintained more than 50% market share in the U.S. rooftop commercial and industrial solar segment. Elevated interest rates, financing challenges, and policy uncertainty continued to affect its U.S. residential business. The company cited customer safe harbor agreements worth $1.7 billion, potentially reaching $3.3 billion when including required optimizers.

Energy storage was the company’s largest revenue-generating product category for the second consecutive quarter, supported by higher battery attachment rates in new installations and increased retrofits. Battery sales to existing customers in Germany and the Netherlands exceeded $30 million, compared with more than $20 million in the preceding quarter.

SolarEdge said its installed base exceeds 1 million homes in Germany and the Netherlands. It also reported larger average Nexis system sizes and higher storage attachment rates in Europe.

The company advanced its solid-state transformer (SST) technology for artificial intelligence (AI) data centers. Its SST cell exceeded 99% efficiency in laboratory testing, and its three-phase conversion stage operated under load. The technology also completed high-voltage insulation and partial-discharge tests, with system-level validation underway.

SolarEdge expanded its collaboration with Infineon on solid-state circuit protection and developed a white paper with NVIDIA on 800-volt DC protection and grounding. It is engaging prospective data center customers.

The company announced restructuring measures to reduce its presence in underperforming markets and direct resources toward more profitable operations and SST development. It expects quarterly savings of about $3 million in cost of goods sold and $2 million in operating expenses, with full benefits from Q1 2027.

Outlook

SolarEdge expects Q4 2026 revenue of $245 million to $275 million, below the previously projected $310 million. It forecasts non-GAAP gross margins of 17% to 21% and non-GAAP operating expenses of $87 million to $91 million. Lower production volumes and the resulting under-absorption of fixed costs are expected to pressure margins.

The company expects Q4 revenue to fall by about $35 million from channel inventory management in the U.S. and Germany, $10 million from withdrawing resources from less profitable markets, and $5 million from euro exchange-rate fluctuations.

SolarEdge anticipates a sequential revenue decline of more than 10% in Q1 2027 because of winter seasonality and regulatory uncertainty in the U.S. and Germany. For 2027, it expects revenue to remain largely flat and aims to reach adjusted EBITDA breakeven. Management described this outlook as an expectation rather than formal full-year guidance.

The company expects Nexis adoption, battery retrofit demand, and U.S. customer commitments to support a recovery after Q1. Markets affected by its restructuring account for approximately $40 million to $50 million in annual revenue.

SolarEdge plans to introduce its single-phase Nexis solution in Europe in Q1 2027, completing the platform’s global rollout. It expects a working laboratory SST system by the end of 2026, customer pilots in 2027, and volume shipments in 2028. The SST solution is designed to convert medium-voltage inputs of 13.8 kV to 34.5 kV to 800 V DC for data centers.

The company projects capital expenditure of $45 million to $55 million in 2026 and expects positive free cash flow for the year. It also anticipates about $4 million in additional refunds related to tariffs imposed under the International Emergency Economic Powers Act in Q4. These potential refunds are excluded from its fourth-quarter guidance.