Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | May 01, 2023 | |
Cover [Abstract] | ||
Entity Registrant Name | SOLAREDGE TECHNOLOGIES, INC. | |
Entity Central Index Key | 0001419612 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2023 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-36894 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 20-5338862 | |
Entity Address, Country | IL | |
Entity Address, City or Town | Herziliya Pituach | |
Entity Address, Address Line One | 1 HaMada Street | |
Entity Address, Postal Zip Code | 4673335 | |
City Area Code | 972 | |
Local Phone Number | (9) 957-6620 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Shell Company | false | |
Title of each class | Common stock, par value $0.0001 per share | |
Trading Symbol | SEDG | |
Name of Exchange on which Security is Registered | NASDAQ | |
Entity Common Stock, Shares Outstanding | 56,344,727 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 727,849 | $ 783,112 |
Marketable securities | 410,820 | 241,117 |
Trade receivables, net of allowances of $4,422 and $3,202, respectively | 969,543 | 905,146 |
Inventories, net | 874,212 | 729,201 |
Prepaid expenses and other current assets | 259,642 | 241,082 |
Total current assets | 3,242,066 | 2,899,658 |
LONG-TERM ASSETS: | ||
Marketable securities | 509,127 | 645,491 |
Deferred tax assets, net | 46,612 | 44,153 |
Property, plant and equipment, net | 556,138 | 543,969 |
Operating lease right-of-use assets, net | 69,710 | 62,754 |
Intangible assets, net | 17,933 | 19,929 |
Goodwill | 29,934 | 31,189 |
Other long-term assets | 24,906 | 18,806 |
Total long-term assets | 1,254,360 | 1,366,291 |
Total assets | 4,496,426 | 4,265,949 |
CURRENT LIABILITIES: | ||
Trade payables, net | 408,523 | 459,831 |
Employees and payroll accruals | 90,853 | 85,158 |
Warranty obligations | 129,278 | 103,975 |
Deferred revenues and customers advances | 27,507 | 26,641 |
Accrued expenses and other current liabilities | 243,881 | 214,112 |
Total current liabilities | 900,042 | 889,717 |
LONG-TERM LIABILITIES: | ||
Convertible senior notes, net | 625,182 | 624,451 |
Warranty obligations | 313,693 | 281,082 |
Deferred revenues | 196,917 | 186,936 |
Finance lease liabilities | 43,711 | 45,385 |
Operating lease liabilities | 50,855 | 46,256 |
Other long-term liabilities | 15,232 | 15,756 |
Total long-term liabilities | 1,245,590 | 1,199,866 |
COMMITMENTS AND CONTINGENT LIABILITIES | ||
STOCKHOLDERS' EQUITY: | ||
Common stock of $0.0001 par value - Authorized: 125,000,000 shares as of March 31, 2023 and December 31, 2022; issued and outstanding: 56,343,164 and 56,133,404 shares as of March 31, 2023 and December 31, 2022, respectively | 6 | 6 |
Additional paid-in capital | 1,545,777 | 1,505,632 |
Accumulated other comprehensive loss | (77,204) | (73,109) |
Retained earnings | 882,215 | 743,837 |
Total stockholders’ equity | 2,350,794 | 2,176,366 |
Total liabilities and stockholders’ equity | $ 4,496,426 | $ 4,265,949 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Allowances of trade receivable | $ 4,422 | $ 3,202 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, authorized shares | 125,000,000 | 125,000,000 |
Common stock, issued shares | 56,343,164 | 56,133,404 |
Common stock, outstanding shares | 56,343,164 | 56,133,404 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Statement [Abstract] | ||
Revenues | $ 943,889 | $ 655,080 |
Cost of revenues | 643,763 | 476,122 |
Gross profit | 300,126 | 178,958 |
Operating expenses: | ||
Research and development | 79,873 | 66,349 |
Sales and marketing | 40,966 | 35,316 |
General and administrative | 36,567 | 26,429 |
Other operating income, net | (1,434) | 0 |
Total operating expenses | 155,972 | 128,094 |
Operating income | 144,154 | 50,864 |
Financial income (expense), net | 23,674 | (4,605) |
Other loss | (125) | (844) |
Income before income taxes | 167,703 | 45,415 |
Income taxes | 29,325 | 12,292 |
Net income | $ 138,378 | $ 33,123 |
Net income per share: | ||
Net basic earnings per share of common stock | $ 2.46 | $ 0.62 |
Net diluted earnings per share of common stock | $ 2.35 | $ 0.6 |
Weighted average number of shares used in computing net basic earnings per share of common stock | 56,215,490 | 53,134,937 |
Weighted average number of shares used in computing net diluted earnings per share of common stock | 59,193,831 | 56,315,193 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 138,378 | $ 33,123 |
Other comprehensive income (loss), net of tax: | ||
Available-for-sale marketable securities | 6,177 | (9,506) |
Cash flow hedges | (331) | (680) |
Foreign currency translation adjustments on intra-entity transactions that are of a long-term investment nature | (10,800) | (6,983) |
Foreign currency translation adjustments | 859 | (1,579) |
Total other comprehensive loss | (4,095) | (18,748) |
Comprehensive income | $ 134,283 | $ 14,375 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional paid in capital [Member] | Accumulated Other comprehensive income (loss) [Member] | Retained earnings [Member] | Total | |
Balance at Dec. 31, 2021 | $ 5 | $ 687,295 | $ (27,319) | $ 650,058 | $ 1,310,039 | |
Balance (in shares) at Dec. 31, 2021 | 52,815,395 | |||||
Issuance of common stock upon exercise of stock-based awards | $ 0 | [1] | 1,478 | 0 | 0 | 1,478 |
Issuance of common stock upon exercise of stock-based awards (in shares) | 270,751 | |||||
Stock based compensation | $ 0 | 34,107 | 0 | 0 | 34,107 | |
Issuance of common stock in a secondary public offering, net of underwriters' discounts and commissions of $27,140 and $834 of offering costs | $ 1 | 650,525 | 0 | 0 | 650,526 | |
Issuance of common stock in a secondary public offering, net of underwriters' discounts and commissions of $27,140 and $834 of offering costs (in shares) | 2,300,000 | |||||
Other comprehensive loss adjustments | $ 0 | 0 | (18,748) | 0 | (18,748) | |
Net income | 0 | 0 | 0 | 33,123 | 33,123 | |
Balance at Mar. 31, 2022 | $ 6 | 1,373,405 | (46,067) | 683,181 | 2,010,525 | |
Balance (in shares) at Mar. 31, 2022 | 55,386,146 | |||||
Balance at Dec. 31, 2022 | $ 6 | 1,505,632 | (73,109) | 743,837 | 2,176,366 | |
Balance (in shares) at Dec. 31, 2022 | 56,133,404 | |||||
Issuance of common stock upon exercise of stock-based awards | $ 0 | [1] | 75 | 0 | 0 | 75 |
Issuance of common stock upon exercise of stock-based awards (in shares) | 209,760 | |||||
Stock based compensation | $ 0 | 40,070 | 0 | 0 | 40,070 | |
Other comprehensive loss adjustments | 0 | 0 | (4,095) | 0 | (4,095) | |
Net income | 0 | 0 | 0 | 138,378 | 138,378 | |
Balance at Mar. 31, 2023 | $ 6 | $ 1,545,777 | $ (77,204) | $ 882,215 | $ 2,350,794 | |
Balance (in shares) at Mar. 31, 2023 | 56,343,164 | |||||
[1]Represents an amount less than $1. |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) (Parenthetical) $ in Thousands | 3 Months Ended |
Mar. 31, 2022 USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Underwriters discounts and commissions | $ 27,140 |
Offering costs | $ 834 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash flows from operating activities: | ||
Net income | $ 138,378 | $ 33,123 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 13,464 | 11,660 |
Stock-based compensation expenses | 39,235 | 34,107 |
Deferred income taxes, net | (3,930) | (1,034) |
Loss (gain) from exchange rate fluctuations | (20,441) | 1,725 |
Other items | 2,810 | 4,167 |
Changes in assets and liabilities: | ||
Inventories, net | (141,521) | (51,323) |
Prepaid expenses and other assets | (20,591) | (17,163) |
Trade receivables, net | (55,002) | (224,865) |
Trade payables, net | (50,410) | (28,045) |
Employees and payroll accruals | 10,227 | 9,246 |
Warranty obligations | 57,864 | 27,629 |
Deferred revenues and customers advances | 9,325 | 15,029 |
Accrued expenses and other liabilities, net | 28,515 | 22,755 |
Net cash provided by (used in) operating activities | 7,923 | (162,989) |
Cash flows from investing activities: | ||
Proceed from sales and maturities of available-for-sale marketable securities | 11,597 | 53,096 |
Purchase of property, plant and equipment | (38,338) | (43,210) |
Investment in available-for-sale marketable securities | (38,979) | (26,712) |
Investment in a privately-held company | (5,500) | 0 |
Other investing activities | 3,440 | 1,692 |
Net cash used in investing activities | (67,780) | (15,134) |
Cash flows from financing activities: | ||
Proceeds from secondary public offering, net of issuance costs | 0 | 650,526 |
Proceeds from exercise of stock-based awards | 75 | 1,478 |
Tax withholding in connection with stock-based awards, net | (4,541) | 822 |
Other financing activities | (756) | (491) |
Net cash provided by (used in) financing activities | (5,222) | 652,335 |
Increase (decrease) in cash and cash equivalents | (65,079) | 474,212 |
Cash and cash equivalents at the beginning of the period | 783,112 | 530,089 |
Effect of exchange rate differences on cash and cash equivalents | 9,816 | (1,529) |
Cash and cash equivalents at the end of the period | 727,849 | 1,002,772 |
Supplemental disclosure of non-cash activities: | ||
Right-of-use asset recognized with a corresponding lease liability | 11,258 | 27,248 |
Purchase of property, plant and equipment | $ 12,304 | $ 19,536 |
GENERAL
GENERAL | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GENERAL | NOTE 1: GENERAL a. SolarEdge Technologies, Inc. (the “Company”) and its subsidiaries design, develop, and sell an intelligent inverter solution designed to maximize power generation at the individual photovoltaic (“PV”) module level while lowering the cost of energy produced by the solar PV system and providing comprehensive and advanced safety features. The Company’s products consist mainly of (i) power optimizers designed to maximize energy throughput from each and every module through constant tracking of Maximum Power Point individually per module, (ii) inverters which invert direct current (DC) from the PV module to alternating current (AC) including the Company’s Energy Hub inverter which supports, among other things, connection to a DC-coupled battery for full or partial home backup, and optional connection to the Company's smart EV charger, (iii) a remote cloud-based monitoring platform, that collects and processes information from the power optimizers and inverters to enable customers and system owners, to monitor and manage the solar PV system (iv) a residential storage and backup solution which includes a company designed and manufactured lithium-ion DC-coupled battery that is used to increase energy independence and maximize self-consumption for homeowners including a battery, and (v) additional smart energy management solutions. The Company and its subsidiaries sell products worldwide through large distributors, electrical equipment wholesalers, as well as directly to large solar installers and engineering, procurement, and construction firms. b. The Company has expanded its activity to other areas of smart energy technology organically and through acquisitions. The Company now offers a variety of energy solutions, which include lithium-ion cells, batteries, and energy storage systems (“Energy Storage”), full powertrain kits for electric vehicles, or EVs (“e-Mobility”), as well as automated machines for industrial use (“Automation Machines”). c. Basis of Presentation: The unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair presentation of the results for the interim periods presented. The Company’s interim period results do not necessarily indicate the results that may be expected for any other interim period or for the full fiscal year. The significant accounting policies applied in the annual consolidated financial statements of the Company as of December 31, 2022, contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 22, 2023, have been applied consistently in these unaudited interim condensed consolidated financial statements. Certain prior year amounts have been reclassified to conform to current year presentation. d. Use of estimates: The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, costs and expenses and related disclosures in the accompanying notes. The duration, scope and effects of the ongoing Covid-19 pandemic and the conflict in Ukraine, government and other third-party responses to it, and the related macroeconomic effects, including to the Company’s business and the business of the Company’s suppliers and customers are uncertain, rapidly changing and difficult to predict. As a result, the Company’s accounting estimates and assumptions may change over time in response to this evolving situation. Such changes could result in future impairments of goodwill, intangibles, long-lived assets, inventories, incremental credit losses on receivables and available-for-sale marketable debt securities, or an increase in the Company’s insurance liabilities as of the time of a relevant measurement event. e. Concentrations of supply risks: The Company depends on two contract manufacturers and several limited or single source component suppliers. Reliance on these vendors makes the Company vulnerable to possible capacity constraints and reduced control over component availability, delivery schedules, manufacturing yields, and costs. As of March 31, 2023, and December 31, 2022, two contract manufacturers collectively accounted for 31.3% and 34.3% of the Company’s total trade payables, net, respectively. In the second quarter of 2022, the Company announced the opening of “Sella 2”, a two gigawatt-hour (GWh) Li-Ion battery cell manufacturing facility located in South Korea. Sella 2 began producing and shipping cells at the end of 2022 and is expected to reach full manufacturing capacity in 2023. Sella 2 is the Company's second owned manufacturing facility following the establishment of Sella 1 in 2020. Sella 1 is the Company's manufacturing facility in the North of Israel that produces power optimizers and inverters for the Company's solar activities. f. New accounting standards updates: From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other standard setting bodies are adopted by the Company as of the specified effective date. The Company believes that the impact of recently issued or newly effective standards were not applicable to the Company, did not have a material impact on the condensed consolidated financial statements or are not expected to have a material impact on the condensed consolidated financial statements. |
MARKETABLE SECURITIES
MARKETABLE SECURITIES | 3 Months Ended |
Mar. 31, 2023 | |
Marketable Securities [Abstract] | |
MARKETABLE SECURITIES | NOTE 2: MARKETABLE SECURITIES The following is a summary of available-for-sale marketable securities as of March 31, 2023: Amortized Gross unrealized gains Gross unrealized losses Fair value Available-for-sale – matures within one year: Corporate bonds $ 390,012 $ 82 $ (8,595 ) $ 381,499 Governmental bonds 29,788 - (467 ) 29,321 419,800 82 (9,062 ) 410,820 Available-for-sale – matures after one year: Corporate bonds 515,425 698 (15,855 ) 500,268 Governmental bonds 9,251 - (392 ) 8,859 524,676 698 (16,247 ) 509,127 Total $ 944,476 $ 780 $ (25,309 ) $ 919,947 The following is a summary of available-for-sale marketable securities as of December 31, 2022: Amortized cost Gross unrealized gains Gross unrealized losses Fair value Available-for-sale – matures within one year: Corporate bonds $ 222,482 $ - $ (4,657 ) $ 217,825 Governmental bonds 23,845 - (553 ) 23,292 246,327 - (5,210 ) 241,117 Available-for-sale – matures after one year: Corporate bonds 657,238 80 (26,460 ) 630,858 Governmental bonds 15,250 - (617 ) 14,633 672,488 80 (27,077 ) 645,491 Total $ 918,815 $ 80 $ (32,287 ) $ 886,608 As of March 31, 2023, and December 31, 2022, the Company did not record an allowance for credit losses for its available-for-sale marketable securities. |
INVENTORIES, NET
INVENTORIES, NET | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
INVENTORIES, NET | NOTE 3: INVENTORIES, NET March 31, 2023 December 31, 2022 Raw materials $ 503,445 $ 503,257 Work in process 37,754 23,407 Finished goods 333,013 202,537 Total inventories, net $ 874,212 $ 729,201 |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 3 Months Ended |
Mar. 31, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | NOTE 4: PREPAID EXPENSES AND OTHER CURRENT ASSETS March 31, 2023 December 31, 2022 Vendor non-trade receivables (*) $ 147,238 $ 147,597 Government authorities 57,275 55,670 Prepaid expenses and other 55,129 37,815 Total prepaid expenses and other current assets $ 259,642 $ 241,082 (*) Vendor non-trade receivables derived from the sale of components to manufacturing vendors who manufacture products for the Company. The Company purchases these components directly from other suppliers. The Company does not reflect the sale of these components to the contract manufacturers in its revenues. |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | NOTE 5: DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES During the three months ended March 31, 2023, the Company instituted a foreign currency cash flow hedging program to reduce the risk of a forecasted increase in the value of foreign currency cash flows, resulting from payment of salaries in Israeli currency, the New Israeli Shekels (“NIS”). The Company hedges portions of the anticipated payroll denominated in NIS for a period of one to nine months with hedging contracts. These hedging contracts are designated as cash flow hedges, as defined by ASC 815 and are all effective hedges. As of March 31, 2023, the Company entered into forward contracts and put and call options to sell U.S. dollars (“USD”) for NIS in the amount of approximately NIS 231 million and NIS 125 million, respectively. In addition to the above-mentioned cash flow hedge transactions, the Company occasionally enters into derivative instrument arrangements to hedge the Company’s exposure to currencies other than the USD. These derivative instruments are not designated as cash flow hedges, as defined by ASC 815, and therefore all gains and losses, resulting from fair value remeasurement, were recorded immediately in the statement of income, under "Financial income (expense), net". The Company classifies cash flows related to its hedging as operating activities in its condensed consolidated statement of cash flows. The fair values of outstanding derivative instruments were as follows: Balance sheet location March 31, 2023 December 31, 2022 Derivative assets of options and forward contracts: Designated cash flow hedges Prepaid expenses and other current assets $ 353 $ - Derivative liabilities of options and forward contracts: Designated cash flow hedges Accrued expenses and other current liabilities $ (2,583 ) $ (1,874 ) Gains (losses) on derivative instruments are summarized below: Three Months Ended March 31, Affected line item 2023 2022 Foreign exchange contracts Non Designated Hedging Instruments Condensed Consolidated Statements of Income - Financial income (expense), net $ - $ 934 Designated Hedging Instruments Condensed Consolidated Statements of Comprehensive Income - Cash flow hedges $ (2,057 ) $ (1,178 ) See Note 13 for information regarding losses from designated hedging instruments reclassified from accumulated other comprehensive loss. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 6: FAIR VALUE MEASUREMENTS In accordance with ASC 820, the Company measures its cash equivalents and marketable securities, at fair value using the market approach valuation technique. Cash and cash equivalents are classified within Level 1 because these assets are valued using quoted market prices. Marketable securities and foreign currency derivative contracts are classified within level 2 due to these assets being valued by alternative pricing sources and models utilizing market observable inputs. The following table sets forth the Company’s assets that were measured at fair value as of March 31, 2023 and December 31, 2022, by level within the fair value hierarchy: Fair Value Hierarchy Fair value measurements as of Description March 31, 2023 December 31, 2022 Assets: Cash and cash equivalents: Cash Level 1 $ 667,384 $ 695,004 Money market mutual funds Level 1 $ 17,486 $ 25,149 Deposits Level 1 $ 42,979 $ 62,959 Derivative instruments Level 2 $ 353 $ - Short-term marketable securities: Corporate bonds Level 2 $ 381,499 $ 217,825 Governmental bonds Level 2 $ 29,321 $ 23,292 Long-term marketable securities: Corporate bonds Level 2 $ 500,268 $ 630,858 Governmental bonds Level 2 $ 8,859 $ 14,633 Liabilities: Derivative instruments Level 2 $ (2,583 ) $ (1,874 ) |
WARRANTY OBLIGATIONS
WARRANTY OBLIGATIONS | 3 Months Ended |
Mar. 31, 2023 | |
Product Warranties Disclosures [Abstract] | |
WARRANTY OBLIGATIONS | NOTE 7: WARRANTY OBLIGATIONS Changes in the Company’s product warranty obligations for the three months ended March 31, 2023 and 2022, were as follows: Three Months Ended March 31, 2023 2022 Balance, at the beginning of the period $ 385,057 $ 265,160 Additions and adjustments to cost of revenues 91,570 47,907 Usage and current warranty expenses (33,656 ) (20,401 ) Balance, at end of the period 442,971 292,666 Less current portion (129,278 ) (82,340 ) Long term portion $ 313,693 $ 210,326 |
DEFERRED REVENUES AND CUSTOMERS
DEFERRED REVENUES AND CUSTOMERS ADVANCES | 3 Months Ended |
Mar. 31, 2023 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
DEFERRED REVENUES AND CUSTOMERS ADVANCES | NOTE 8: DEFERRED REVENUES AND CUSTOMERS ADVANCES Deferred revenues consist of deferred cloud-based monitoring services, communication services, warranty extension services and advance payments received from customers for the Company’s products. Deferred revenues are classified as short-term and long-term deferred revenues based on the period in which revenues are expected to be recognized. Significant changes in the balances of deferred revenues and customer advances during the period are as follows: Three Months Ended March 31, 2023 2022 Balance, at the beginning of the period $ 213,577 $ 169,345 Revenue recognized (11,742 ) (14,529 ) Increase in deferred revenues and customer advances 22,589 29,429 Balance, at the end of the period 224,424 184,245 Less current portion (27,507 ) (25,511 ) Long term portion $ 196,917 $ 158,734 The following table includes estimated revenues expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of March 31, 2023 2023 $ 23,888 2024 12,073 2025 10,764 2026 10,389 2027 8,363 Thereafter 158,947 Total deferred revenues $ 224,424 |
ACCRUED EXPENSES AND OTHER CURR
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 3 Months Ended |
Mar. 31, 2023 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | NOTE 9: ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES March 31, 2023 December 31, 2022 Accrued expenses $ 127,018 $ 117,638 Government authorities 87,159 67,514 Operating lease liabilities 17,215 16,183 Accrual for sales incentives 5,746 6,790 Other 6,743 5,987 Total accrued expenses and other current liabilities $ 243,881 $ 214,112 |
CONVERTIBLE SENIOR NOTES
CONVERTIBLE SENIOR NOTES | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes | NOTE 10: CONVERTIBLE SENIOR NOTES On September 25, 2020, the Company sold $632,500 aggregate principal amount of its 0.00% convertible senior notes due 2025 (the “Notes”). The Notes were sold pursuant to an indenture, dated September 25, 2020 (the “Indenture”), between the Company and U.S. Bank National Association, as trustee. The Notes do not bear regular interest and mature on September 15, 2025, unless earlier repurchased or converted in accordance with their terms. The Notes are general senior unsecured obligations of the Company. Holders may convert their Notes prior to the close of business on the business day immediately preceding June 15, 2025 in multiples of $1,000 principal amount, only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on December 31, 2020 (and only during such calendar quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five-business-day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of the Notes for each trading day of that five consecutive trading day period was less than 98% of the product of the last reported sale price of the common stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events as described in the Indenture. In addition, holders may convert their Notes, in multiples of $1,000 principal amount, at their option at any time beginning on or after June 15, 2025, and prior to the close of business on the second scheduled trading day immediately preceding the stated maturity date of the Notes, without regard to the foregoing circumstances. The initial conversion rate for the Notes was 3.5997 shares of common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $277.80 per share of common stock, subject to adjustment upon the occurrence of certain specified events as set forth in the Indenture. Upon conversion, the Company may choose to pay or deliver, as the case may be, cash, shares of common stock, or a combination of cash and shares of common stock. In addition, upon the occurrence of a fundamental change (as defined in the Indenture), holders of the Notes may require the Company to repurchase all or a portion of their Notes, in multiples of $1,000 principal amount, at a repurchase price of 100% of the principal amount of the Notes, plus any accrued and unpaid special interest to, but excluding the fundamental change repurchase date. If certain fundamental changes referred to as make-whole fundamental changes occur, the conversion rate for the Notes may be increased. The Convertible Senior Notes consisted of the following as of March 31, 2023 December 31, 2022 March 31, 2023 December 31, 2022 Liability: Principal $ 632,500 $ 632,500 Unamortized issuance costs (7,318 ) (8,049 ) Net carrying amount $ 625,182 $ 624,451 For the three months ended March 31, 2023 and 2022 the Company related to the Notes in the amount of $731 and $728, respectively. As of March 31, 2023, costs of the Notes will be amortized over the remaining term of approximately 2.5 years. The annual effective interest rate of the Notes is 0.47%. As of March 31, 2023, the estimated fair value of the Notes, which the Company has classified as Level 2 financial instruments, is $823,730. The estimated fair value was determined based on the quoted bid price of the Notes in an over-the-counter market on the last trading day of the reporting period. As of March 31, 2023, the if-converted value of the Notes exceeded the principal amount by $59,537. |
STOCK CAPITAL
STOCK CAPITAL | 3 Months Ended |
Mar. 31, 2023 | |
Share-based Payment Arrangement [Abstract] | |
STOCK CAPITAL | NOTE 11: STOCK CAPITAL a. Common stock rights: Common stock confers upon its holders the right to receive notice of, and to participate in, all general meetings of the Company, where each share of common stock shall have one vote for all purposes, to share equally, on a per share basis, in bonuses, profits, or distributions out of fund legally available therefor, and to participate in the distribution of the surplus assets of the Company in the event of liquidation of the Company. b. Secondary public offering: On March 17, 2022, the Company offered and sold 2,300,000 shares of the Company’s common stock, at a public offering price of $295.00 per share. The shares of Common Stock were issued and sold in a registered offering pursuant to the underwriting agreement dated March 17, 2022, among the Company, Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, and Morgan Stanley & Co. LLC (the “Underwriting Agreement”). All of the offered shares were issued at closing, including 300,000 shares of Common Stock that were issued and sold pursuant to the underwriters’ option to purchase additional shares under the Underwriting Agreement, which was exercised in full on March 18, 2022. The net proceeds to the Company were $650,526 after deducting underwriters' discounts of $27,140 and commissions of $834. c. Equity Incentive Plans: The Company’s 2007 Global Incentive Plan (the “2007 Plan”) was adopted by the board of directors on August 30, 2007. The 2007 Plan terminated upon the Company’s IPO on March 31, 2015 and no further awards may be granted thereunder. All outstanding awards will continue to be governed by their existing terms and 379,358 available options for future grants were transferred to the Company’s 2015 Global Incentive Plan (the “2015 Plan”) and are reserved for future issuances under the 2015 plan. The 2015 Plan became effective upon the consummation of the IPO. The 2015 Plan provides for the grant of options, restricted stock units ("RSU"), performance stock units ("PSU"), and other share-based awards to directors, employees, officers, and non-employees of the Company and its subsidiaries. As of March 31, 2023, a total of 20,853,755 shares of common stock were reserved for issuance pursuant to stock awards under the 2015 Plan (the “Share Reserve”) , an aggregate of 12,005,195 The Share Reserve will automatically increase on January 1 st st 5% of the total number of shares of capital stock outstanding on December 31 st st st The Company granted under its 2015 Plan, PSU awards to certain employees and officers which vest upon the achievement of certain performance or market conditions subject to their continued employment with the Company. In 2021, the Company has also committed to issuing additional shares, which carry certain performance conditions (including business performance targets and a continued service relationship with the Company) and are treated as PSUs for accounting purposes. The market condition for the PSUs is based on the Company’s total shareholder return ("TSR") compared to the TSR of companies listed in the S&P 500 index over a one to three year performance period. The Company uses a Monte-Carlo simulation to determine the grant date fair value for these awards, which takes into consideration the market price of a share of the Company’s common stock on the date of grant less the present value of dividends expected during the requisite service period, as well as the possible outcomes pertaining to the TSR market condition. The Company recognizes such compensation expenses on an accelerated vesting method. The aggregate maximum number of shares of common stock that may be issued on the exercise of incentive stock options is 10,000,000. As of March 31, 2023, an aggregate of 8,617,974 options are still available for future grants under the 2015 Plan. A summary of the activity in stock options and related information is as follows: Number of options Weighted average exercise price Weighted average remaining contractual term in years Aggregate intrinsic Value Outstanding as of December 31, 2022 339,029 $ 50.64 4.86 $ 79,414 Exercised (3,645 ) 20.46 - 1,073 Outstanding as of March 31, 2023 335,384 $ 50.97 4.63 $ 84,989 Vested and expected to vest as of March 31, 2023 334,950 $ 50.80 4.62 $ 84,937 Exercisable as of March 31, 2023 311,240 $ 40.47 4.43 $ 82,079 The aggregate intrinsic value in the tables above represents the total intrinsic value (the difference between the fair value of the Company’s common stock as of the last day of each period and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on the last day of each period. A summary of the activity in the RSUs and related information is as follows: Number of RSUs Weighted average grant date fair value Unvested as of December 31, 2022 1,488,515 $ 232.05 Granted 103,081 296.64 Vested (197,866 ) 164.31 Forfeited (31,296 ) 254.24 Unvested as of March 31, 2023 1,362,434 $ 246.27 A summary of the activity in the PSUs and related information is as follows: Number of PSUs Weighted average grant date fair value Unvested as of December 31, 2022 149,232 $ 295.88 Granted 31,911 314.22 Vested (8,249 ) 270.93 Unvested as of March 31, 2023 172,894 $ 300.45 d. Employee Stock Purchase Plan ("ESPP"): The Company adopted an ESPP effective upon the consummation of the IPO. As of March 31, 2023, a total of 4,150,380 shares were reserved for issuance under this plan. The number of shares of common stock reserved for issuance under the ESPP will increase automatically on January 1 st The ESPP is implemented through an offering every six months. According to the ESPP, eligible employees may use up to 15% of their salaries to purchase common stock up to an aggregate limit of $15 per participant for every six months plan. The price of an ordinary share purchased under the ESPP is equal to 85% of the lower of the fair market value of the ordinary share on the subscription date of each offering period or on the purchase date. As of March 31, 2023, 738,876 shares of common stock had been purchased under the ESPP. As of March 31, 2023, 3,411,504 shares of common stock were available for future issuance under the ESPP. In accordance with ASC No. 718, the ESPP is compensatory and, as such, results in recognition of compensation cost. e. Stock-based compensation expenses: The Company recognized stock-based compensation expenses related to all stock-based awards in the condensed consolidated statement of income for the three months ended March 31, 2023, and 2022, as follows: Three Months Ended March 31, 2023 2022 Cost of revenues $ 5,927 $ 5,062 Research and development 17,209 14,985 Selling and marketing 8,079 6,701 General and administrative 8,020 7,359 Total stock-based compensation expenses $ 39,235 $ 34,107 For the three months ended March 31, 2023, the Company capitalized stock-based compensation expenses in the amount of $430 related to ERP implementation, which were included within other long-term assets in the condensed consolidated balance sheets and $405 related to inventory. For the three months ended March 31, 2022, the Company did not capitalize any stock-based compensation expenses. The total tax benefit associated with share-based compensation for the three months ended March 31, 2023 and 2022 was $4,197 and $3,478, respectively. The tax benefit realized from share-based compensation for three months ended March 31, 2023 and 2022 was $2,842 and $2,927, respectively. As of March 31, 2023, there were total unrecognized compensation expenses in the amount of $335,864 related to non-vested equity-based compensation arrangements granted. These expenses are expected to be recognized during the period from April 1, 2023 through February 28, 2027. |
COMMITMENTS AND CONTINGENT LIAB
COMMITMENTS AND CONTINGENT LIABILITIES | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENT LIABILITIES | NOTE 12: COMMITMENTS AND CONTINGENT LIABILITIES a. Guarantees: As of March 31, 2023 $5,876 $1,899 b. Contractual purchase obligations: The Company has contractual obligations to purchase goods and raw materials. These contractual purchase obligations relate to inventories and other purchase orders, which cannot be canceled without penalty. In addition, the Company acquires raw materials or other goods and services, including product components, by issuing authorizations to its suppliers to purchase materials based on its projected demand and manufacturing needs. As of March 31, 2023 $1,617,376 $8,052 As of March 31, 2023 $121,347 c. Legal claims: From time to time, the Company may be involved in various claims and legal proceedings. The Company reviews the status of each matter and assesses its potential financial exposure. If the potential loss from any claim or legal proceeding is considered probable and the amount can be reasonably estimated, the Company accrues a liability for the estimated loss. These accruals are reviewed at least quarterly and adjusted to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular matter. In September 2018, the Company’s German subsidiary, SolarEdge Technologies GmbH, received a complaint filed by competitor SMA Solar Technology AG (“SMA”). The complaint, filed in the District Court Düsseldorf, Germany, alleges that SolarEdge's 12.5kW - 27.6kW inverters infringed on two of the plaintiff’s patents. SMA asserted a value in dispute of EUR 5.5 million (approximately $5,983) for both patents. The Company challenged the validity of both patents and the first patent was invalidated and SMA’s appeal on the matter was denied in January 2023. In August 2021, the German Patent Court rendered SMA's second patent invalid, and this invalidity has been appealed by SMA and a hearing is pending. The Company believes that it has meritorious defenses to these claims and intends to vigorously defend against the remaining lawsuit. On July 28, 2022, the Company was served with complaints filed by Ampt LLC in the International Trade Commission (the “Commission”) pursuant to Section 337 of the Tariff Act of 1930, as amended, in the District Court for the District of Delaware alleging patent infringement against the Company and its subsidiary SolarEdge Technologies Ltd. On October 24, 2022, the complaint filed in the District Court of Delaware was administratively stayed until the Commission's action is resolved. The Company believes that it has meritorious defenses to the complaints and intend to vigorously defend against them. As of March 31, 2023 |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE LOSS | 3 Months Ended |
Mar. 31, 2023 | |
Accumulated Other Comprehensive Income Loss [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | NOTE 13: ACCUMULATED OTHER COMPREHENSIVE LOSS The following table summarizes the changes in accumulated balances of other comprehensive gain (loss), net of taxes: Three Months Ended March 31, 2023 2022 Unrealized gains (losses) on available-for-sale marketable securities Beginning balance $ (25,449 ) $ (4,709 ) Revaluation 7,570 (12,721 ) Tax on revaluation (1,471 ) 2,471 Other comprehensive income (loss) before reclassifications 6,099 (10,250 ) Reclassification 107 844 Tax on reclassification (29 ) (100 ) Losses reclassified from accumulated other comprehensive income 78 744 Net current period other comprehensive income (loss) 6,177 (9,506 ) Ending balance $ (19,272 ) $ (14,215 ) Unrealized gains (losses) on cash flow hedges Beginning balance $ (1,761 ) $ 874 Revaluation (2,196 ) (1,337 ) Tax on revaluation 139 159 Other comprehensive loss before reclassifications (2,057 ) (1,178 ) Reclassification 1,840 565 Tax on reclassification (114 ) (67 ) Losses reclassified from accumulated other comprehensive loss 1,726 498 Net current period other comprehensive loss (331 ) (680 ) Ending balance $ (2,092 ) $ 194 Foreign currency translation adjustments on intra-entity transactions that are of a long-term investment in nature Beginning balance $ (37,960 ) $ (17,420 ) Revaluation (10,800 ) (6,983 ) Ending balance $ (48,760 ) $ (24,403 ) Unrealized gains (losses) on foreign currency translation Beginning balance $ (7,939 ) $ (6,064 ) Revaluation 859 (1,579 ) Ending balance $ (7,080 ) $ (7,643 ) Total $ (77,204 ) $ (46,067 ) The following table summarizes the reclassifications from "Accumulated other comprehensive loss" into the statement of income: Details about Accumulated Other Comprehensive Loss Components Three Months Ended March 31, Affected Line Item in the Statement of Income 2023 2022 Available-for-sale marketable securities $ (107 ) $ (844) Financial income (expense), net 29 100 Income taxes $ (78 ) $ (744) Total, net of income taxes Cash flow hedges (212 ) (67 ) Cost of revenues (1,129 ) (338 ) Research and development (225 ) (71 ) Sales and marketing (274 ) (89 ) General and administrative $ (1,840 ) $ (565) Total, before income taxes 114 67 Income taxes (1,726 ) (498 ) Total, net of income taxes Total reclassifications for the period $ (1,804 ) $ (1,242) |
OTHER OPERATING INCOME
OTHER OPERATING INCOME | 3 Months Ended |
Mar. 31, 2023 | |
Other Income and Expenses [Abstract] | |
OTHER OPERATING INCOME | NOTE 14: OTHER OPERATING INCOME In the three months ended March 31, 2023, the Company recorded a gain from sale of property, plant and equipment and other assets in the amount of $1,434. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2023 | |
Income Taxes | |
INCOME TAXES | NOTE 15: INCOME TAXES The effective tax rate for the three months ended March 31, 2023, and 2022 was 17.5% and 27.1%, respectively. The lower tax rate in the current quarter compared to the first quarter of 2022 is mainly due to the fact that the Company's income before tax, most of which is subject to tax rates lower than the US statutory rate, increased. Conversely, the IRC Section 174 R&D capitalization, and other expenses not recognized for GILTI purposes, did not increase in the same proportion. As of March 31, 2023, and December 31, 2022, unrecognized tax benefits were $2,883 and $2,756, respectively. If recognized, such benefits would favorably affect the Company’s effective tax rate. The Company accrues interest and penalties related to unrecognized tax benefits in its provision for income taxes. The total amount of penalties and interest were immaterial as of March 31, 2023, and December 31, 2022. In August 2022, the U.S. government enacted the Inflation Reduction Act of 2022 (the “IRA”), which includes several incentives intended to promote clean energy, battery and energy storage, electrical vehicles, and other solar products, and is expected to impact our business and operations. As part of such incentives the IRA, will among other things, extend the investment tax credit (“ITC”) through 2034 and is therefore expected to increase the demand for solar products. The IRA is expected to further incentivize residential and commercial solar customers and developers due to the inclusion of a tax credit for qualifying energy projects of up to 30%. Since these regulations are new and their implementation is still pending administrative guidance from the Internal Revenue Service and U.S. Treasury Department, the Company will be examining the benefits that may be available to it, such as the availability of tax credits for domestic manufacturers, in the coming months. The Company also announced its plans to establish manufacturing capabilities in the United States during 2023. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 3 Months Ended |
Mar. 31, 2023 | |
Net income per share: | |
EARNINGS PER SHARE | NOTE 16: EARNINGS PER SHARE The following table presents the computation of basic and diluted earnings per share (“EPS”): Three Months Ended March 31, 2023 2022 Basic EPS: Numerator: Net income $ 138,378 $ 33,123 Denominator: Shares used in computing net earnings per share of common stock, basic 56,215,490 53,134,937 Diluted EPS: Numerator: Net income attributable to common stock, basic $ 138,378 $ 33,123 Notes due 2025 552 553 Net income attributable to common stock, diluted $ 138,930 $ 33,676 Denominator: Shares used in computing net earnings per share of common stock, basic 56,215,490 53,134,937 Notes due 2025 2,276,818 2,276,818 Effect of stock-based awards 701,523 903,438 Shares used in computing net earnings per share of common stock, diluted 59,193,831 56,315,193 Earnings per share: Basic $ 2.46 $ 0.62 Diluted $ 2.35 $ 0.60 Shares excluded from the calculation of diluted net EPS due to their anti-dilutive effect 192,339 223,776 |
SEGMENT INFORMATION
SEGMENT INFORMATION | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | NOTE 17: SEGMENT INFORMATION Following the discontinuation of Critical Power in June 2022, the Company operates in four different operating segments: Solar, Energy Storage, e-Mobility and Automation Machines. The Company’s Chief Executive Officer, who is the chief operating decision maker (“CODM”), makes resource allocation decisions and assesses performance based on financial information presented on a consolidated basis, accompanied by disaggregated information about revenues and contributed profit by the operating segments. The Company does not allocate to its operating segments revenue recognized due to advance payments received for performance obligations that extend for a period greater than one year, related to Accounting Standard Codification 606, “Revenue from Contracts with Customers” (ASC 606). Segment profit is comprised of gross profit for the segment less operating expenses that do not include amortization of purchased intangible assets, impairments of goodwill and intangible assets, stock based compensation expenses, and certain other items. The Company manages its assets on a group basis, not by segments, as many of its assets are shared or co-mingled. The Company’s CODM does not regularly review asset information by segments and, therefore, the Company does not report asset information by segment. The Company identified one operating segment as reportable – the Solar segment. The other operating segments are insignificant individually and therefore their results are presented together under “All other”. The Solar segment includes the design, development, manufacturing, and sales of an intelligent inverter solution designed to maximize power generation at the individual PV module level and a residential storage solution, compatible with the Company’s Energy Hub inverter, intended to store and supply power for back-up and to maximize self-consumption. The Solar segment solution consists mainly of the Company’s power optimizers, inverters, batteries, and cloud‑based monitoring platform. The “All other” category includes the design, development, manufacturing, and sales of energy storage products, e-Mobility products, UPS products, and automated machines. The following table presents information on reportable segments profit (loss) for the period presented: Three Months Ended March 31, 2023 2022 Solar All other Solar All other Revenues $ 908,505 $ 35,197 $ 607,997 $ 46,948 Cost of revenues 590,105 46,216 424,500 44,341 Gross profit (loss) 318,400 (11,019 ) 183,497 2,607 Research and development $ 55,823 $ 6,528 $ 43,131 $ 7,930 Sales and marketing 31,145 1,561 25,805 2,574 General and administrative 24,743 3,778 15,849 3,625 Segments profit (loss) $ 206,689 $ (22,886 ) $ 98,712 $ (11,522 ) The following table presents information on reportable segments reconciliation to consolidated revenues for the periods presented: Three Months Ended March 31, 2023 2022 Solar revenues $ 908,505 $ 607,997 All other segment revenues 35,197 46,948 Revenues from financing component 187 135 Consolidated revenues $ 943,889 $ 655,080 The following table presents information on reportable segments reconciliation to consolidated operating income for the periods presented: Three Months Ended March 31, 2023 2022 Solar segment profit $ 206,689 $ 98,712 All other segment loss (22,886 ) (11,522 ) Segments operating profit 183,803 87,190 Amounts not allocated to segments: Stock based compensation expenses (39,235 ) (34,107 ) Other unallocated expenses (414 ) (2,219 ) Consolidated operating income $ 144,154 $ 50,864 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 18: SUBSEQUENT EVENTS On April 6, 2023, the Company completed the acquisition of all outstanding shares of Hark Systems Ltd. ("Hark"), a UK-based energy IoT company for the commercial and industrial ("C&I") sector for approximately USD 16.7 million in cash. Hark's platform is expected to enable the Company to offer its commercial and industrial customers expanded capabilities in energy management and connectivity, including identification of potential energy savings, detection of anomalies in assets’ energy consumption, and optimization of energy usage and carbon emissions through load orchestration and storage control. |
GENERAL (Policies)
GENERAL (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | c. Basis of Presentation: The unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair presentation of the results for the interim periods presented. The Company’s interim period results do not necessarily indicate the results that may be expected for any other interim period or for the full fiscal year. The significant accounting policies applied in the annual consolidated financial statements of the Company as of December 31, 2022, contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 22, 2023, have been applied consistently in these unaudited interim condensed consolidated financial statements. Certain prior year amounts have been reclassified to conform to current year presentation. |
Use of estimates | d. Use of estimates: The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, costs and expenses and related disclosures in the accompanying notes. The duration, scope and effects of the ongoing Covid-19 pandemic and the conflict in Ukraine, government and other third-party responses to it, and the related macroeconomic effects, including to the Company’s business and the business of the Company’s suppliers and customers are uncertain, rapidly changing and difficult to predict. As a result, the Company’s accounting estimates and assumptions may change over time in response to this evolving situation. Such changes could result in future impairments of goodwill, intangibles, long-lived assets, inventories, incremental credit losses on receivables and available-for-sale marketable debt securities, or an increase in the Company’s insurance liabilities as of the time of a relevant measurement event. |
Concentrations of supply risks | e. Concentrations of supply risks: The Company depends on two contract manufacturers and several limited or single source component suppliers. Reliance on these vendors makes the Company vulnerable to possible capacity constraints and reduced control over component availability, delivery schedules, manufacturing yields, and costs. As of March 31, 2023, and December 31, 2022, two contract manufacturers collectively accounted for 31.3% and 34.3% of the Company’s total trade payables, net, respectively. In the second quarter of 2022, the Company announced the opening of “Sella 2”, a two gigawatt-hour (GWh) Li-Ion battery cell manufacturing facility located in South Korea. Sella 2 began producing and shipping cells at the end of 2022 and is expected to reach full manufacturing capacity in 2023. Sella 2 is the Company's second owned manufacturing facility following the establishment of Sella 1 in 2020. Sella 1 is the Company's manufacturing facility in the North of Israel that produces power optimizers and inverters for the Company's solar activities. |
New accounting standards updates | f. New accounting standards updates: From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other standard setting bodies are adopted by the Company as of the specified effective date. The Company believes that the impact of recently issued or newly effective standards were not applicable to the Company, did not have a material impact on the condensed consolidated financial statements or are not expected to have a material impact on the condensed consolidated financial statements. |
MARKETABLE SECURITIES (Tables)
MARKETABLE SECURITIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Marketable Securities [Abstract] | |
Schedule of available-for-sale marketable securities | The following is a summary of available-for-sale marketable securities as of March 31, 2023: Amortized Gross unrealized gains Gross unrealized losses Fair value Available-for-sale – matures within one year: Corporate bonds $ 390,012 $ 82 $ (8,595 ) $ 381,499 Governmental bonds 29,788 - (467 ) 29,321 419,800 82 (9,062 ) 410,820 Available-for-sale – matures after one year: Corporate bonds 515,425 698 (15,855 ) 500,268 Governmental bonds 9,251 - (392 ) 8,859 524,676 698 (16,247 ) 509,127 Total $ 944,476 $ 780 $ (25,309 ) $ 919,947 The following is a summary of available-for-sale marketable securities as of December 31, 2022: Amortized cost Gross unrealized gains Gross unrealized losses Fair value Available-for-sale – matures within one year: Corporate bonds $ 222,482 $ - $ (4,657 ) $ 217,825 Governmental bonds 23,845 - (553 ) 23,292 246,327 - (5,210 ) 241,117 Available-for-sale – matures after one year: Corporate bonds 657,238 80 (26,460 ) 630,858 Governmental bonds 15,250 - (617 ) 14,633 672,488 80 (27,077 ) 645,491 Total $ 918,815 $ 80 $ (32,287 ) $ 886,608 |
INVENTORIES, NET (Tables)
INVENTORIES, NET (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories, Net | March 31, 2023 December 31, 2022 Raw materials $ 503,445 $ 503,257 Work in process 37,754 23,407 Finished goods 333,013 202,537 Total inventories, net $ 874,212 $ 729,201 |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | March 31, 2023 December 31, 2022 Vendor non-trade receivables (*) $ 147,238 $ 147,597 Government authorities 57,275 55,670 Prepaid expenses and other 55,129 37,815 Total prepaid expenses and other current assets $ 259,642 $ 241,082 (*) Vendor non-trade receivables derived from the sale of components to manufacturing vendors who manufacture products for the Company. The Company purchases these components directly from other suppliers. The Company does not reflect the sale of these components to the contract manufacturers in its revenues. |
DERIVATIVE INSTRUMENTS AND HE_2
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of fair values of outstanding derivative instruments | Balance sheet location March 31, 2023 December 31, 2022 Derivative assets of options and forward contracts: Designated cash flow hedges Prepaid expenses and other current assets $ 353 $ - Derivative liabilities of options and forward contracts: Designated cash flow hedges Accrued expenses and other current liabilities $ (2,583 ) $ (1,874 ) |
Schedule of gains (losses) on derivative instruments recognized in our income statements | Three Months Ended March 31, Affected line item 2023 2022 Foreign exchange contracts Non Designated Hedging Instruments Condensed Consolidated Statements of Income - Financial income (expense), net $ - $ 934 Designated Hedging Instruments Condensed Consolidated Statements of Comprehensive Income - Cash flow hedges $ (2,057 ) $ (1,178 ) |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets and liabilities measured at fair value | Fair Value Hierarchy Fair value measurements as of Description March 31, 2023 December 31, 2022 Assets: Cash and cash equivalents: Cash Level 1 $ 667,384 $ 695,004 Money market mutual funds Level 1 $ 17,486 $ 25,149 Deposits Level 1 $ 42,979 $ 62,959 Derivative instruments Level 2 $ 353 $ - Short-term marketable securities: Corporate bonds Level 2 $ 381,499 $ 217,825 Governmental bonds Level 2 $ 29,321 $ 23,292 Long-term marketable securities: Corporate bonds Level 2 $ 500,268 $ 630,858 Governmental bonds Level 2 $ 8,859 $ 14,633 Liabilities: Derivative instruments Level 2 $ (2,583 ) $ (1,874 ) |
WARRANTY OBLIGATIONS (Tables)
WARRANTY OBLIGATIONS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Product Warranties Disclosures [Abstract] | |
Schedule of warranty obligations | Three Months Ended March 31, 2023 2022 Balance, at the beginning of the period $ 385,057 $ 265,160 Additions and adjustments to cost of revenues 91,570 47,907 Usage and current warranty expenses (33,656 ) (20,401 ) Balance, at end of the period 442,971 292,666 Less current portion (129,278 ) (82,340 ) Long term portion $ 313,693 $ 210,326 |
DEFERRED REVENUES AND CUSTOME_2
DEFERRED REVENUES AND CUSTOMERS ADVANCES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Schedule of balances of deferred revenues | Three Months Ended March 31, 2023 2022 Balance, at the beginning of the period $ 213,577 $ 169,345 Revenue recognized (11,742 ) (14,529 ) Increase in deferred revenues and customer advances 22,589 29,429 Balance, at the end of the period 224,424 184,245 Less current portion (27,507 ) (25,511 ) Long term portion $ 196,917 $ 158,734 |
Schedule estimated revenues expected to recognized in future to performance obligations | 2023 $ 23,888 2024 12,073 2025 10,764 2026 10,389 2027 8,363 Thereafter 158,947 Total deferred revenues $ 224,424 |
ACCRUED EXPENSES AND OTHER CU_2
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of accrued expenses and other current liabilities | March 31, 2023 December 31, 2022 Accrued expenses $ 127,018 $ 117,638 Government authorities 87,159 67,514 Operating lease liabilities 17,215 16,183 Accrual for sales incentives 5,746 6,790 Other 6,743 5,987 Total accrued expenses and other current liabilities $ 243,881 $ 214,112 |
CONVERTIBLE SENIOR NOTES (Table
CONVERTIBLE SENIOR NOTES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of convertible senior notes | March 31, 2023 December 31, 2022 Liability: Principal $ 632,500 $ 632,500 Unamortized issuance costs (7,318 ) (8,049 ) Net carrying amount $ 625,182 $ 624,451 |
STOCK CAPITAL (Tables)
STOCK CAPITAL (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of activity in the share options granted to employees and members of board of directors | Number of options Weighted average exercise price Weighted average remaining contractual term in years Aggregate intrinsic Value Outstanding as of December 31, 2022 339,029 $ 50.64 4.86 $ 79,414 Exercised (3,645 ) 20.46 - 1,073 Outstanding as of March 31, 2023 335,384 $ 50.97 4.63 $ 84,989 Vested and expected to vest as of March 31, 2023 334,950 $ 50.80 4.62 $ 84,937 Exercisable as of March 31, 2023 311,240 $ 40.47 4.43 $ 82,079 |
Schedule of RSU activity | Number of RSUs Weighted average grant date fair value Unvested as of December 31, 2022 1,488,515 $ 232.05 Granted 103,081 296.64 Vested (197,866 ) 164.31 Forfeited (31,296 ) 254.24 Unvested as of March 31, 2023 1,362,434 $ 246.27 |
Schedule of recognized stock-based compensation expenses | Three Months Ended March 31, 2023 2022 Cost of revenues $ 5,927 $ 5,062 Research and development 17,209 14,985 Selling and marketing 8,079 6,701 General and administrative 8,020 7,359 Total stock-based compensation expenses $ 39,235 $ 34,107 |
Option [Member] | Employees and members of board of directors | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of RSU activity | Number of PSUs Weighted average grant date fair value Unvested as of December 31, 2022 149,232 $ 295.88 Granted 31,911 314.22 Vested (8,249 ) 270.93 Unvested as of March 31, 2023 172,894 $ 300.45 |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Accumulated Other Comprehensive Income Loss [Abstract] | |
Schedule of changes in AOCI | Three Months Ended March 31, 2023 2022 Unrealized gains (losses) on available-for-sale marketable securities Beginning balance $ (25,449 ) $ (4,709 ) Revaluation 7,570 (12,721 ) Tax on revaluation (1,471 ) 2,471 Other comprehensive income (loss) before reclassifications 6,099 (10,250 ) Reclassification 107 844 Tax on reclassification (29 ) (100 ) Losses reclassified from accumulated other comprehensive income 78 744 Net current period other comprehensive income (loss) 6,177 (9,506 ) Ending balance $ (19,272 ) $ (14,215 ) Unrealized gains (losses) on cash flow hedges Beginning balance $ (1,761 ) $ 874 Revaluation (2,196 ) (1,337 ) Tax on revaluation 139 159 Other comprehensive loss before reclassifications (2,057 ) (1,178 ) Reclassification 1,840 565 Tax on reclassification (114 ) (67 ) Losses reclassified from accumulated other comprehensive loss 1,726 498 Net current period other comprehensive loss (331 ) (680 ) Ending balance $ (2,092 ) $ 194 Foreign currency translation adjustments on intra-entity transactions that are of a long-term investment in nature Beginning balance $ (37,960 ) $ (17,420 ) Revaluation (10,800 ) (6,983 ) Ending balance $ (48,760 ) $ (24,403 ) Unrealized gains (losses) on foreign currency translation Beginning balance $ (7,939 ) $ (6,064 ) Revaluation 859 (1,579 ) Ending balance $ (7,080 ) $ (7,643 ) Total $ (77,204 ) $ (46,067 ) |
Schedule of reclassifications out of AOCI | Details about Accumulated Other Comprehensive Loss Components Three Months Ended March 31, Affected Line Item in the Statement of Income 2023 2022 Available-for-sale marketable securities $ (107 ) $ (844) Financial income (expense), net 29 100 Income taxes $ (78 ) $ (744) Total, net of income taxes Cash flow hedges (212 ) (67 ) Cost of revenues (1,129 ) (338 ) Research and development (225 ) (71 ) Sales and marketing (274 ) (89 ) General and administrative $ (1,840 ) $ (565) Total, before income taxes 114 67 Income taxes (1,726 ) (498 ) Total, net of income taxes Total reclassifications for the period $ (1,804 ) $ (1,242) |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Net income per share: | |
Schedule of computation of basic and diluted net earnings (loss) per share | Three Months Ended March 31, 2023 2022 Basic EPS: Numerator: Net income $ 138,378 $ 33,123 Denominator: Shares used in computing net earnings per share of common stock, basic 56,215,490 53,134,937 Diluted EPS: Numerator: Net income attributable to common stock, basic $ 138,378 $ 33,123 Notes due 2025 552 553 Net income attributable to common stock, diluted $ 138,930 $ 33,676 Denominator: Shares used in computing net earnings per share of common stock, basic 56,215,490 53,134,937 Notes due 2025 2,276,818 2,276,818 Effect of stock-based awards 701,523 903,438 Shares used in computing net earnings per share of common stock, diluted 59,193,831 56,315,193 Earnings per share: Basic $ 2.46 $ 0.62 Diluted $ 2.35 $ 0.60 Shares excluded from the calculation of diluted net EPS due to their anti-dilutive effect 192,339 223,776 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of reportable segments and operating income | Three Months Ended March 31, 2023 2022 Solar All other Solar All other Revenues $ 908,505 $ 35,197 $ 607,997 $ 46,948 Cost of revenues 590,105 46,216 424,500 44,341 Gross profit (loss) 318,400 (11,019 ) 183,497 2,607 Research and development $ 55,823 $ 6,528 $ 43,131 $ 7,930 Sales and marketing 31,145 1,561 25,805 2,574 General and administrative 24,743 3,778 15,849 3,625 Segments profit (loss) $ 206,689 $ (22,886 ) $ 98,712 $ (11,522 ) |
Schedule of reconciliation to consolidated operating income | The following table presents information on reportable segments reconciliation to consolidated revenues for the periods presented: Three Months Ended March 31, 2023 2022 Solar revenues $ 908,505 $ 607,997 All other segment revenues 35,197 46,948 Revenues from financing component 187 135 Consolidated revenues $ 943,889 $ 655,080 The following table presents information on reportable segments reconciliation to consolidated operating income for the periods presented: Three Months Ended March 31, 2023 2022 Solar segment profit $ 206,689 $ 98,712 All other segment loss (22,886 ) (11,522 ) Segments operating profit 183,803 87,190 Amounts not allocated to segments: Stock based compensation expenses (39,235 ) (34,107 ) Other unallocated expenses (414 ) (2,219 ) Consolidated operating income $ 144,154 $ 50,864 |
GENERAL (Narrative) (Details)
GENERAL (Narrative) (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Accounts Payable [Member] | Supplier Concentration Risk [Member] | ||
Organization Consolidation and Presentation of Financial Statements [Line Items] | ||
Concentration Risk As Percent | 31.30% | 34.30% |
MARKETABLE SECURITIES (Schedule
MARKETABLE SECURITIES (Schedule of AFS Marketable Debt Securities) (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Available-for-sale - matures within one year, Amortized cost | $ 419,800 | $ 246,327 |
Available-for-sale - matures within one year, Gross unrealized gains | 82 | 0 |
Available-for-sale - matures within one year, Gross unrealized losses | (9,062) | (5,210) |
Available-for-sale - matures within one year, Fair value | 410,820 | 241,117 |
Available-for-sale - matures after one year, Amortized cost | 524,676 | 672,488 |
Available-for-sale - matures after one year, Gross unrealized gains | 698 | 80 |
Available-for-sale - matures after one year, Gross unrealized losses | (16,247) | (27,077) |
Available-for-sale - matures after one year, Fair value | 509,127 | 645,491 |
Amortized cost | 944,476 | 918,815 |
Gross unrealized gains | 780 | 80 |
Gross unrealized losses | (25,309) | (32,287) |
Fair value | 919,947 | 886,608 |
Corporate bonds [Member] | ||
Available-for-sale - matures within one year, Amortized cost | 390,012 | 222,482 |
Available-for-sale - matures within one year, Gross unrealized gains | 82 | 0 |
Available-for-sale - matures within one year, Gross unrealized losses | (8,595) | (4,657) |
Available-for-sale - matures within one year, Fair value | 381,499 | 217,825 |
Available-for-sale - matures after one year, Amortized cost | 515,425 | 657,238 |
Available-for-sale - matures after one year, Gross unrealized gains | 698 | 80 |
Available-for-sale - matures after one year, Gross unrealized losses | (15,855) | (26,460) |
Available-for-sale - matures after one year, Fair value | 500,268 | 630,858 |
Governmental bonds [Member] | ||
Available-for-sale - matures within one year, Amortized cost | 29,788 | 23,845 |
Available-for-sale - matures within one year, Gross unrealized gains | 0 | 0 |
Available-for-sale - matures within one year, Gross unrealized losses | (467) | (553) |
Available-for-sale - matures within one year, Fair value | 29,321 | 23,292 |
Available-for-sale - matures after one year, Amortized cost | 9,251 | 15,250 |
Available-for-sale - matures after one year, Gross unrealized gains | 0 | 0 |
Available-for-sale - matures after one year, Gross unrealized losses | (392) | (617) |
Available-for-sale - matures after one year, Fair value | $ 8,859 | $ 14,633 |
INVENTORIES, NET (Schedule of I
INVENTORIES, NET (Schedule of Inventories, Net) (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 503,445 | $ 503,257 |
Work in process | 37,754 | 23,407 |
Finished goods | 333,013 | 202,537 |
Total inventories, net | $ 874,212 | $ 729,201 |
PREPAID EXPENSES AND OTHER CU_3
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||
Vendor non-trade receivables | [1] | $ 147,238 | $ 147,597 |
Government authorities | 57,275 | 55,670 | |
Prepaid expenses and other | 55,129 | 37,815 | |
Total prepaid expenses and other current assets | $ 259,642 | $ 241,082 | |
[1]Vendor non-trade receivables derived from the sale of components to manufacturing vendors who manufacture products for the Company. The Company purchases these components directly from other suppliers. The Company does not reflect the sale of these components to the contract manufacturers in its revenues. |
DERIVATIVE INSTRUMENTS AND HE_3
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Narrative) (Details) - Foreign exchange forward contracts [Member] - NIS [Member] ₪ in Millions | Mar. 31, 2023 ILS (₪) |
Put option [Member] | |
Derivative [Line Items] | |
Forward/option contracts | ₪ 231 |
Call option [Member] | |
Derivative [Line Items] | |
Forward/option contracts | ₪ 125 |
DERIVATIVE INSTRUMENTS AND HE_4
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Schedule of fair values of outstanding derivative instruments) (Details) - Designated cash flow hedges [Member] - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Derivative assets of options and forward contracts: | ||
Total derivative assets | $ 353 | $ 0 |
Derivative liabilities of options and forward contracts: | ||
Total derivative liabilities | $ (2,583) | $ (1,874) |
DERIVATIVE INSTRUMENTS AND HE_5
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Schedule of Gains (losses) on derivative instruments recognized in our income statements) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Designated Hedging Instruments [Member] | ||
Trading Activity, Gains and Losses, Net [Line Items] | ||
Gains (losses) on derivative instruments | $ (2,057) | $ (1,178) |
Non Designated Hedging Instruments [Member] | ||
Trading Activity, Gains and Losses, Net [Line Items] | ||
Gains (losses) on derivative instruments | $ 0 | $ 934 |
FAIR VALUE MEASUREMENTS (Schedu
FAIR VALUE MEASUREMENTS (Schedule of Assets Measured at Fair Value) (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Level 1 [Member] | Cash [Member] | ||
Fair value of assets | $ 667,384 | $ 695,004 |
Level 1 [Member] | Money Market Mutual Funds [Member] | ||
Fair value of assets | 17,486 | 25,149 |
Level 1 [Member] | Deposits [Member] | ||
Fair value of assets | 42,979 | 62,959 |
Level 2 [Member] | Derivative instruments, Liabilities [Member] | ||
Fair value of liabilities | (2,583) | (1,874) |
Level 2 [Member] | Derivative instruments, Assets [Member] | ||
Fair value of assets | 353 | 0 |
Level 2 [Member] | Short-term Corporate bonds [Member] | ||
Fair value of assets | 381,499 | 217,825 |
Level 2 [Member] | Short-term Governmental bonds [Member] | ||
Fair value of assets | 29,321 | 23,292 |
Level 2 [Member] | Long-term Corporate bonds [Member] | ||
Fair value of assets | 500,268 | 630,858 |
Level 2 [Member] | Long-term Governmental bonds [Member] | ||
Fair value of assets | $ 8,859 | $ 14,633 |
WARRANTY OBLIGATIONS (Schedule
WARRANTY OBLIGATIONS (Schedule of product warranty obligations) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Changes in the Company's product warranty liability | |||
Balance, at the beginning of the period | $ 385,057 | $ 265,160 | |
Additions and adjustments to cost of revenues | 91,570 | 47,907 | |
Usage and current warranty expenses | (33,656) | (20,401) | |
Balance, at end of the period | 442,971 | 292,666 | |
Less current portion | (129,278) | (82,340) | $ (103,975) |
Long term portion | $ 313,693 | $ 210,326 | $ 281,082 |
DEFERRED REVENUES AND CUSTOME_3
DEFERRED REVENUES AND CUSTOMERS ADVANCES (Schedule of Balances of deferred revenues and customer advances) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Revenue Recognition and Deferred Revenue [Abstract] | ||
Balance, at the beginning of the period | $ 213,577 | $ 169,345 |
Revenue recognized | (11,742) | (14,529) |
Increase in deferred revenues and customer advances | 22,589 | 29,429 |
Balance, at the end of the period | 224,424 | 184,245 |
Less current portion | (27,507) | (25,511) |
Long term portion | $ 196,917 | $ 158,734 |
DEFERRED REVENUES AND CUSTOME_4
DEFERRED REVENUES AND CUSTOMERS ADVANCES (Schedule Estimated Revenues Expected To Recognized In Future To Performance Obligations) (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Deferred revenues | $ 224,424 | $ 213,577 | $ 184,245 | $ 169,345 |
2023 [Member] | ||||
Deferred revenues | 23,888 | |||
2024 [Member] | ||||
Deferred revenues | 12,073 | |||
2025 [Member] | ||||
Deferred revenues | 10,764 | |||
2026 [Member] | ||||
Deferred revenues | 10,389 | |||
2027 [Member] | ||||
Deferred revenues | 8,363 | |||
Thereafter [Member] | ||||
Deferred revenues | $ 158,947 |
ACCRUED EXPENSES AND OTHER CU_3
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Schedule of Accrued Expenses and Other Current Liabilities) (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Payables and Accruals [Abstract] | ||
Accrued expenses | $ 127,018 | $ 117,638 |
Government authorities | 87,159 | 67,514 |
Operating lease liabilities | 17,215 | 16,183 |
Accrual for sales incentives | 5,746 | 6,790 |
Other | 6,743 | 5,987 |
Total accrued expenses and other current liabilities | $ 243,881 | $ 214,112 |
CONVERTIBLE SENIOR NOTES (Narra
CONVERTIBLE SENIOR NOTES (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | |
Sep. 25, 2020 | Mar. 31, 2023 | Mar. 31, 2022 | |
Convertible Senior Notes due 2025 [Member] | |||
Debt Instrument [Line Items] | |||
Debt conversion description | On September 25, 2020, the Company sold $632,500 aggregate principal amount of its 0.00% convertible senior notes due 2025 (the “Notes”). The Notes were sold pursuant to an indenture, dated September 25, 2020 (the “Indenture”), between the Company and U.S. Bank National Association, as trustee. The Notes do not bear regular interest and mature on September 15, 2025, unless earlier repurchased or converted in accordance with their terms. The Notes are general senior unsecured obligations of the Company. Holders may convert their Notes prior to the close of business on the business day immediately preceding June 15, 2025 in multiples of $1,000 principal amount, only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on December 31, 2020 (and only during such calendar quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five-business-day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of the Notes for each trading day of that five consecutive trading day period was less than 98% of the product of the last reported sale price of the common stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events as described in the Indenture. In addition, holders may convert their Notes, in multiples of $1,000 principal amount, at their option at any time beginning on or after June 15, 2025, and prior to the close of business on the second scheduled trading day immediately preceding the stated maturity date of the Notes, without regard to the foregoing circumstances. The initial conversion rate for the Notes was 3.5997 shares of common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $277.80 per share of common stock, subject to adjustment upon the occurrence of certain specified events as set forth in the Indenture. | ||
Principal amount sold | $ 632,500 | ||
Effective coupon rate | 0% | ||
Maturity date | Sep. 15, 2025 | ||
Conversion amount | $ 1,000 | ||
Number of shares of common stock per $1,000 principal amount of Notes converted | 3.5997 | ||
Amount of conversion | $ 1,000 | ||
Conversion price | $ 277.8 | ||
Amortization of debt discount and debt issuance costs | $ 731 | $ 728 | |
Amortized period | 2 years 6 months | ||
Effective interest | 0.47% | ||
Amount by which the if-converted value of the Notes exceeded the principal amount | $ 59,537 | ||
Senior Notes [Member] | Level 2 [Member] | |||
Debt Instrument [Line Items] | |||
Estimated fair value of notes | $ 823,730 |
CONVERTIBLE SENIOR NOTES (Sched
CONVERTIBLE SENIOR NOTES (Schedule of Convertible Senior Notes) (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Liability Abstract | ||
Net carrying amount | $ 625,182 | $ 624,451 |
Convertible Senior Notes [Member] | ||
Liability Abstract | ||
Principal | 632,500 | 632,500 |
Unamortized issuance costs | (7,318) | (8,049) |
Net carrying amount | $ 625,182 | $ 624,451 |
STOCK CAPITAL (Narrative) (Deta
STOCK CAPITAL (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Mar. 17, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | Mar. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Proceeds from secondary public offering, net of issuance costs | $ 0 | $ 650,526 | ||
Underwriters discounts and commissions | 27,140 | |||
Offering costs | 834 | |||
Number of shares of common stock reserved for issuance pursuant to stock awards under the plan | 10,000,000 | |||
Equity based compensation expenses to employees and nonemployees | $ 4,197 | 3,478 | ||
Capitalized stock-based compensation expenses related to ERP | 430 | |||
Inventory | 405 | |||
Tax benefit realized from share-based compensation | 2,842 | $ 2,927 | ||
Unrecognized compensation expense | $ 335,864 | |||
IPO [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Common stock shares sold in public offerings | 2,300,000 | |||
Per share price of common stock sold | $ 295 | |||
IPO [Member] | Underwriting Agreement [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Common stock shares sold in public offerings | 300,000 | |||
Proceeds from secondary public offering, net of issuance costs | $ 650,526 | |||
Underwriters discounts and commissions | 27,140 | |||
Offering costs | $ 834 | |||
Option [Member] | Two Thousand Seven Global Incentive Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares of common stock reserved for issuance pursuant to stock awards under the plan | 20,853,755 | |||
Number of shares available for future grant under the plan | 12,005,195 | |||
Option [Member] | Two Thousand Fifteen Global Incentive Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Percentage Of Common Shares Increase Automatically Each Year | 5% | |||
Number of shares available for future grant under the plan | 8,617,974 | 379,358 | ||
Employee Stock Purchase Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares of common stock reserved for issuance pursuant to stock awards under the plan | 4,150,380 | |||
Percentage Of Common Shares Increase Automatically Each Year | 1% | |||
Period Of Plan Increase Automatically Number Of Shares | 487,643 | |||
Maximum Percentage Of Salary | 15% | |||
Aggregate Limit Per Participant | $ 15 | |||
Purchase price of common stock, percent | 85% | |||
Number of Common stock purchased | 738,876 | |||
Number of shares available for future grant under the plan | 3,411,504 |
STOCK CAPITAL (Summary of the A
STOCK CAPITAL (Summary of the Activity in the Share Options) (Details) - Option [Member] - Employees and Members of Board of Directors [Member] - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Number of options | ||
Outstanding at the beginning of the period | 339,029 | |
Exercised | (3,645) | |
Outstanding at the end of the period | 335,384 | 339,029 |
Weighted average exercise price | ||
Outstanding at the beginning of the period | $ 50.64 | |
Exercised | 20.46 | |
Outstanding at the end of the period | $ 50.97 | $ 50.64 |
Weighted Average Remaining Contractual Term In Years | ||
Outstanding | 4 years 7 months 17 days | 4 years 10 months 9 days |
Aggregate Intrinsic Value | ||
Outstanding | $ 84,989 | $ 79,414 |
Exercised | $ 1,073 | |
Vested and expected to vest at the end of the period | ||
Number of options | 334,950 | |
Weighted average exercise price | $ 50.8 | |
Weighted average remaining contractual term in years | 4 years 7 months 13 days | |
Aggregate intrinsic Value | $ 84,937 | |
Exercisable at the end of the period | ||
Number of options | 311,240 | |
Weighted average exercise price | $ 40.47 | |
Weighted average remaining contractual term in years | 4 years 5 months 4 days | |
Aggregate intrinsic Value | $ 82,079 |
STOCK CAPITAL (Schedule of RSUs
STOCK CAPITAL (Schedule of RSUs and PSUs Activity) (Details) | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Restricted Stock Units (RSUs) [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested at beginning of period | shares | 1,488,515 |
Granted | shares | 103,081 |
Vested | shares | (197,866) |
Forfeited | shares | (31,296) |
Unvested at end of period | shares | 1,362,434 |
Weighted average grant date fair value, beginning of period | $ / shares | $ 232.05 |
Weighted average grant date fair value, granted | $ / shares | 296.64 |
Weighted average grant date fair value, vested | $ / shares | 164.31 |
Weighted average grant date fair value, forfeited | $ / shares | 254.24 |
Weighted average grant date fair value, end of period | $ / shares | $ 246.27 |
Phantom Share Units (PSUs) [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested at beginning of period | shares | 149,232 |
Granted | shares | 31,911 |
Vested | shares | (8,249) |
Unvested at end of period | shares | 172,894 |
Weighted average grant date fair value, beginning of period | $ / shares | $ 295.88 |
Weighted average grant date fair value, granted | $ / shares | 314.22 |
Weighted average grant date fair value, vested | $ / shares | 270.93 |
Weighted average grant date fair value, end of period | $ / shares | $ 300.45 |
STOCK CAPITAL (Schedule of Stoc
STOCK CAPITAL (Schedule of Stock-based Compensation Expense for Employees and Nonemployee) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expenses | $ 39,235 | $ 34,107 |
Cost of revenues [Member] | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expenses | 5,927 | 5,062 |
Research and development [Member] | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expenses | 17,209 | 14,985 |
Sales and marketing [Member] | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expenses | 8,079 | 6,701 |
General and administrative [Member] | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expenses | $ 8,020 | $ 7,359 |
COMMITMENTS AND CONTINGENT LI_2
COMMITMENTS AND CONTINGENT LIABILITIES (Narrative) (Details) - 3 months ended Mar. 31, 2023 $ in Thousands, € in Millions | EUR (€) | USD ($) |
Non-cancelable purchase obligations | $ 1,617,376 | |
Provision for loss | 8,052 | |
Contractual obligations for capital expenditures | 121,347 | |
Patents [Member] | ||
Value in dispute | € 5.5 | 5,983 |
Office Rent Lease Agreements [Member] | ||
Guarantees amount | 5,876 | |
Projects With Customers [Member] | ||
Guarantees amount | $ 1,899 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE LOSS (Schedule of Changes in AOCI) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Beginning balance | $ (73,109) | |
Net current period other comprehensive income (loss) | (4,095) | $ (18,748) |
Ending balance | (77,204) | (46,067) |
Unrealized gains (losses) on available-for-sale marketable securities [Member] | ||
Beginning balance | (25,449) | (4,709) |
Revaluation | 7,570 | (12,721) |
Tax on revaluation | (1,471) | 2,471 |
Other comprehensive income (loss) before reclassifications | 6,099 | (10,250) |
Reclassification | 107 | 844 |
Tax on reclassification | (29) | (100) |
Losses reclassified from accumulated other comprehensive income | 78 | 744 |
Net current period other comprehensive income (loss) | 6,177 | (9,506) |
Ending balance | (19,272) | (14,215) |
Unrealized gains (losses) on cash flow hedges [Member] | ||
Beginning balance | (1,761) | 874 |
Revaluation | (2,196) | (1,337) |
Tax on revaluation | 139 | 159 |
Other comprehensive income (loss) before reclassifications | (2,057) | (1,178) |
Reclassification | 1,840 | 565 |
Tax on reclassification | (114) | (67) |
Losses reclassified from accumulated other comprehensive income | 1,726 | 498 |
Net current period other comprehensive income (loss) | (331) | (680) |
Ending balance | (2,092) | 194 |
Foreign currency translation adjustments on intra-entity transactions that are of a long-term investment in nature [Member] | ||
Beginning balance | (37,960) | (17,420) |
Revaluation | (10,800) | (6,983) |
Ending balance | (48,760) | (24,403) |
Unrealized gains (losses) on foreign currency translation [Member] | ||
Beginning balance | (7,939) | (6,064) |
Revaluation | (859) | (1,579) |
Ending balance | $ (7,080) | $ (7,643) |
ACCUMULATED OTHER COMPREHENSI_4
ACCUMULATED OTHER COMPREHENSIVE LOSS (Schedule of Reclassifications of Other Comprehensive Income Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of revenues | $ 643,763 | $ 476,122 |
Research and development | 79,873 | 66,349 |
Sales and marketing | 40,966 | 35,316 |
General and administrative | 36,567 | 26,429 |
Total, before income taxes | 155,972 | 128,094 |
Income taxes | 29,325 | 12,292 |
Total, net of income taxes | 138,378 | 33,123 |
Available-for-sale marketable securities [Member] | Amount Reclassified from Accumulated Other Comprehensive Income (Loss) [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Financial income (expense), net | (107) | (844) |
Income taxes | 29 | 100 |
Total, net of income taxes | (78) | (744) |
Cash flow hedges [Member] | Amount Reclassified from Accumulated Other Comprehensive Income (Loss) [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of revenues | (212) | (67) |
Research and development | (1,129) | (338) |
Sales and marketing | (225) | (71) |
General and administrative | (274) | (89) |
Total, before income taxes | (1,840) | (565) |
Income taxes | 114 | 67 |
Total, net of income taxes | (1,726) | (498) |
Total reclassifications for the period | $ (1,804) | $ (1,242) |
OTHER OPERATING INCOME (Narrati
OTHER OPERATING INCOME (Narrative) (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Other Income and Expenses [Abstract] | |
Sale of property, plant and equipment | $ 1,434 |
INCOME TAXES (Narrative) (Detai
INCOME TAXES (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Income Taxes Schedule Of Taxes On Income Details | |||
Effective tax rate | 17.50% | 27.10% | |
Unrecognized tax benefits | $ 2,883 | $ 2,756 |
EARNINGS PER SHARE (Schedule of
EARNINGS PER SHARE (Schedule of Computation of Basic and Diluted Net Earnings (Loss) Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Numerator: | ||
Net income | $ 138,378 | $ 33,123 |
Denominator: | ||
Shares used in computing net earnings per share of common stock, basic | 56,215,490 | 53,134,937 |
Numerator: | ||
Net income attributable to common stock, basic | $ 138,378 | $ 33,123 |
Notes due 2025 | 552 | 553 |
Net income attributable to common stock, diluted | $ 138,930 | $ 33,676 |
Denominator: | ||
Shares used in computing net earnings per share of common stock, basic | 56,215,490 | 53,134,937 |
Notes due 2025 | 2,276,818 | 2,276,818 |
Effect of stock-based awards | 701,523 | 903,438 |
Shares used in computing net earnings per share of common stock, diluted | 59,193,831 | 56,315,193 |
Earnings per share: | ||
Basic | $ 2.46 | $ 0.62 |
Diluted | $ 2.35 | $ 0.6 |
Shares excluded from the calculation of diluted net EPS due to their anti-dilutive effect | 192,339 | 223,776 |
SEGMENT INFORMATION (Schedule o
SEGMENT INFORMATION (Schedule of reportable segments and operating income) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Segment Reporting Information [Line Items] | ||
Revenues | $ 943,889 | $ 655,080 |
Cost of revenues | 643,763 | 476,122 |
Gross profit (loss) | 300,126 | 178,958 |
Research and development | 79,873 | 66,349 |
Sales and marketing | 40,966 | 35,316 |
General and administrative | 36,567 | 26,429 |
Solar segment profit | 206,689 | 98,712 |
All other segment loss | (22,886) | (11,522) |
Segments operating profit | 183,803 | 87,190 |
Amounts not allocated to segments: | ||
Stock based compensation expenses | (39,235) | (34,107) |
Other unallocated expenses | (414) | (2,219) |
Consolidated operating income | 144,154 | 50,864 |
Solar [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 908,505 | 607,997 |
Cost of revenues | 590,105 | 424,500 |
Gross profit (loss) | 318,400 | 183,497 |
Research and development | 55,823 | 43,131 |
Sales and marketing | 31,145 | 25,805 |
General and administrative | 24,743 | 15,849 |
Segments profit (loss) | 206,689 | 98,712 |
All Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 35,197 | 46,948 |
Cost of revenues | 46,216 | 44,341 |
Gross profit (loss) | (11,019) | 2,607 |
Research and development | 6,528 | 7,930 |
Sales and marketing | 1,561 | 2,574 |
General and administrative | 3,778 | 3,625 |
Segments profit (loss) | $ (22,886) | $ (11,522) |
SEGMENT INFORMATION (Schedule_2
SEGMENT INFORMATION (Schedule of reportable segments reconciliation) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Segment Reporting Information [Line Items] | ||
Revenues | $ 943,889 | $ 655,080 |
Solar revenues [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 908,505 | 607,997 |
All other revenues [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 35,197 | 46,948 |
Revenues from finance component [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | $ 187 | $ 135 |
SUBSEQUENT EVENTS (Narrative) (
SUBSEQUENT EVENTS (Narrative) (Details) $ in Millions | Apr. 06, 2023 USD ($) |
Subsequent Event [Member] | Hark Systems Ltd. ("Hark") [Member] | |
Subsequent Event [Line Items] | |
Amount of business acquisition | $ 16.7 |