Shoals Technologies (SHLS) 10-Q 14 Nov 22 2022 Q3 Quarterly report Financial data

Cover

Cover - shares	9 Months Ended
	Sep. 30, 2022	Nov. 07, 2022
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2022
Document Transition Report	false
Entity File Number	001-39942
Entity Registrant Name	Shoals Technologies Group, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	85-3774438
Entity Address, Address Line One	1400 Shoals Way
Entity Address, City or Town	Portland
Entity Address, State or Province	TN
Entity Address, Postal Zip Code	37148
City Area Code	(615)
Local Phone Number	451-1400
Title of 12(b) Security	Class A Common Stock, $0.00001 Par Value
Trading Symbol	SHLS
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Amendment Flag	false
Entity Central Index Key	0001831651
Current Fiscal Year End Date	--12-31
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2022
Class A Common Stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		113,508,362
Class B Common Stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		53,816,214

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Current Assets
Cash and cash equivalents	$ 11,202	$ 5,006
Accounts receivable, net	71,652	31,499
Unbilled receivables	11,561	13,533
Inventory, net	81,158	38,368
Other current assets	7,608	5,042
Total Current Assets	183,181	93,448
Property, plant and equipment, net	16,596	15,574
Goodwill	69,941	69,436
Other intangible assets, net	58,606	65,236
Deferred tax assets	177,112	176,958
Other assets	24,456	5,762
Total Assets	529,892	426,414
Current Liabilities
Accounts payable	21,383	19,985
Accrued expenses and other	43,407	9,569
Current portion of payable pursuant to the tax receivable agreement	3,583	0
Long-term debt—current portion	2,000	2,000
Total Current Liabilities	70,373	31,554
Revolving line of credit	85,640	55,140
Long-term debt, less current portion	189,289	189,913
Payable pursuant to the tax receivable agreement, less current portion	157,420	156,374
Other long-term liabilities	4,500	931
Total Liabilities	507,222	433,912
Commitments and Contingencies (Note 15)
Stockholders’ Equity (Deficit)
Preferred stock, $0.00001 par value - 5,000,000 shares authorized; none issued and outstanding as of September 30, 2022 and December 31, 2021	0	0
Additional paid-in capital	104,539	95,684
Accumulated deficit	(78,133)	(93,133)
Total stockholders’ equity attributable to Shoals Technologies Group, Inc.	26,408	2,553
Non-controlling interests	(3,738)	(10,051)
Total stockholders' equity (deficit)	22,670	(7,498)
Total Liabilities and Stockholders’ Equity (Deficit)	529,892	426,414
Class A Common Stock
Stockholders’ Equity (Deficit)
Common stock	1	1
Class B Common Stock
Stockholders’ Equity (Deficit)
Common stock	$ 1	$ 1

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Sep. 30, 2022	Dec. 31, 2021
Preferred stock, par value (USD per share)	$ 0.00001	$ 0.00001
Preferred stock authorized (shares)	5,000,000	5,000,000
Preferred stock issued (shares)	0	0
Preferred stock outstanding (shares)	0	0
Class A Common Stock
Common stock, par value (USD per share)	$ 0.00001	$ 0.00001
Common stock authorized (shares)	1,000,000,000	1,000,000,000
Common stock issued (shares)	113,508,362	112,049,981
Common stock outstanding (shares)	113,508,362	112,049,981
Class B Common Stock
Common stock, par value (USD per share)	$ 0.00001	$ 0.00001
Common stock authorized (shares)	195,000,000	195,000,000
Common stock issued (shares)	53,816,214	54,794,479
Common stock outstanding (shares)	53,816,214	54,794,479

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Revenue	$ 90,823	$ 59,840	$ 232,289	$ 165,166
Cost of revenue	54,776	38,071	141,357	98,444
Gross profit	36,047	21,769	90,932	66,722
Operating Expenses
General and administrative expenses	13,853	10,031	41,037	26,865
Depreciation and amortization	2,229	2,175	6,939	6,305
Total Operating Expenses	16,082	12,206	47,976	33,170
Income from Operations	19,965	9,563	42,956	33,552
Interest expense, net	(4,754)	(3,582)	(12,760)	(10,911)
Payable pursuant to the tax receivable agreement adjustment	0	(2,014)	0	(3,678)
Loss on debt repayment	0	0	0	(15,990)
Income before income taxes	15,211	3,967	30,196	2,973
Income tax benefit (expense)	(2,452)	1,309	(5,485)	3,123
Net income	12,759	5,276	24,711	6,096
Less: net income attributable to non-controlling interests	4,801	2,790	9,711	1,911
Net income attributable to Shoals Technologies Group, Inc.	$ 7,958	$ 2,486	$ 15,000	$ 4,185
Earnings per share of Class A common stock:
Basic (USD per share)	$ 0.07	$ 0.02	$ 0.13
Diluted (USD per share)	$ 0.07	$ 0.02	$ 0.13
Weighted average shares of Class A common stock outstanding:
Basic (shares)	112,975	101,890	112,561
Diluted (shares)	113,584	102,251	112,816
Class A Common Stock
Earnings per share of Class A common stock:
Basic (USD per share)	$ 0.07	$ 0.02	$ 0.13
Diluted (USD per share)	$ 0.07	$ 0.02	$ 0.13
Weighted average shares of Class A common stock outstanding:
Basic (shares)	112,975	101,890	112,561
Diluted (shares)	113,584	102,251	112,816

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit) (Unaudited) - USD ($) $ in Thousands	Total	Class A Common Stock	Class B Common Stock	Members' Equity	Common Stock Class A Common Stock	Common Stock Class B Common Stock	Additional Paid-In Capital	Accumulated Deficit	Non-Controlling Interests
Members' equity at beginning of period at Dec. 31, 2020				$ (184,123)
Balance at beginning of period (shares) at Dec. 31, 2020					0	0
Balance at beginning of period at Dec. 31, 2020	$ (184,123)				$ 0	$ 0	$ 0	$ 0	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Deferred tax adjustment related to Tax Receivable Agreement	7,180						7,180
Equity-based compensation	1,392						1,392
Effect of Organizational Transactions	0			181,448	$ 1	$ 1		(92,806)	(88,644)
Effect of Organizational Transactions (shares)					81,977,751	78,300,817
Issuance of Class A common stock sold in IPO, net of underwriting discounts and commissions and offering costs (shares)					11,550,000	(5,234,210)
Issuance of Class A common stock sold in IPO, net of underwriting discounts and commissions and offering costs	141,164						70,188		70,976
Activity under stock compensation plan (shares)					11,941
Activity under equity-based compensation plan	(137)						(687)		550
Members' equity at end of period at Mar. 31, 2021				0
Balance at end of period (shares) at Mar. 31, 2021					93,539,692	73,066,607
Balance at end of period at Mar. 31, 2021	(42,858)				$ 1	$ 1	78,073	(98,340)	(22,593)
Members' equity at beginning of period at Dec. 31, 2020				(184,123)
Balance at beginning of period (shares) at Dec. 31, 2020					0	0
Balance at beginning of period at Dec. 31, 2020	(184,123)				$ 0	$ 0	0	0	0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Distributions to non-controlling interest	(4,800)
Net income	6,096
Members' equity at end of period at Sep. 30, 2021				0
Balance at end of period (shares) at Sep. 30, 2021					104,179,939	62,664,521
Balance at end of period at Sep. 30, 2021	(11,127)				$ 1	$ 1	92,149	(91,296)	(11,982)
Members' equity at beginning of period at Mar. 31, 2021				0
Balance at beginning of period (shares) at Mar. 31, 2021					93,539,692	73,066,607
Balance at beginning of period at Mar. 31, 2021	(42,858)				$ 1	$ 1	78,073	(98,340)	(22,593)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Equity-based compensation	1,955						1,955
Activity under stock compensation plan (shares)					5,872
Activity under equity-based compensation plan	0						(857)		857
Distributions to non-controlling interest	(2,973)								(2,973)
Reallocation of non-controlling interest	0						(288)		288
Net income	9,154							4,558	4,596
Members' equity at end of period at Jun. 30, 2021				0
Balance at end of period (shares) at Jun. 30, 2021					93,545,564	73,066,607
Balance at end of period at Jun. 30, 2021	(34,722)				$ 1	$ 1	78,883	(93,782)	(19,825)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Equity-based compensation	3,057						3,057
Issuance of Class A common stock sold in IPO, net of underwriting discounts and commissions and offering costs (shares)					10,402,086
Issuance of Class A common stock sold in IPO, net of underwriting discounts and commissions and offering costs	281,064						281,064
Purchase of LLC Interests and Class B common stock (shares)						(10,402,086)
Purchase of LLC Interests and Class B common stock	(281,064)						(281,064)
Deferred tax adjustment related to purchase of LLC Interests in follow-on offering	11,031						11,031
Deferred tax adjustment related to ConnectPV LLC conversion	(405)						(405)
Issuance of Class A common stock in connection with an acquisition (shares)					209,437
Issuance of Class A common stock in connection with an acquisition	6,500						6,500
Activity under stock compensation plan (shares)					22,852
Activity under equity-based compensation plan	0						(1,200)		1,200
Distributions to non-controlling interest	(1,864)								(1,864)
Reallocation of non-controlling interest	0						(5,717)		5,717
Net income	5,276							2,486	2,790
Members' equity at end of period at Sep. 30, 2021				$ 0
Balance at end of period (shares) at Sep. 30, 2021					104,179,939	62,664,521
Balance at end of period at Sep. 30, 2021	(11,127)				$ 1	$ 1	92,149	(91,296)	(11,982)
Balance at beginning of period (shares) at Dec. 31, 2021		112,049,981	54,794,479		112,049,981	54,794,479
Balance at beginning of period at Dec. 31, 2021	(7,498)				$ 1	$ 1	95,684	(93,133)	(10,051)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Equity-based compensation	5,636						5,636
Activity under equity-based compensation plan	(1,297)						(2,944)		1,647
Vesting of restricted share units (shares)					308,416
Distributions to non-controlling interest	(2,938)								(2,938)
Net income	4,649							2,640	2,009
Balance at end of period (shares) at Mar. 31, 2022					112,358,397	54,794,479
Balance at end of period at Mar. 31, 2022	(1,448)				$ 1	$ 1	98,376	(90,493)	(9,333)
Balance at beginning of period (shares) at Dec. 31, 2021		112,049,981	54,794,479		112,049,981	54,794,479
Balance at beginning of period at Dec. 31, 2021	(7,498)				$ 1	$ 1	95,684	(93,133)	(10,051)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Distributions to non-controlling interest	(7,800)
Net income	24,711
Balance at end of period (shares) at Sep. 30, 2022		113,508,362	53,816,214		113,508,362	53,816,214
Balance at end of period at Sep. 30, 2022	22,670				$ 1	$ 1	104,539	(78,133)	(3,738)
Balance at beginning of period (shares) at Mar. 31, 2022					112,358,397	54,794,479
Balance at beginning of period at Mar. 31, 2022	(1,448)				$ 1	$ 1	98,376	(90,493)	(9,333)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Deferred tax adjustment related to Tax Receivable Agreement	148						148
Exchange of Class B common stock to Class A common stock (shares)					259,888	(259,888)
Equity-based compensation	4,065						4,065
Activity under equity-based compensation plan	0						(1,326)		1,326
Vesting of restricted share units (shares)					48,721
Distributions to non-controlling interest	(1,628)								(1,628)
Reallocation of non-controlling interest	0						(20)		20
Net income	7,303							4,402	2,901
Balance at end of period (shares) at Jun. 30, 2022					112,667,006	54,534,591
Balance at end of period at Jun. 30, 2022	8,440				$ 1	$ 1	101,243	(86,091)	(6,714)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Deferred tax adjustment related to Tax Receivable Agreement	676						676
Exchange of Class B common stock to Class A common stock (shares)					718,377	(718,377)
Equity-based compensation	3,991						3,991
Activity under equity-based compensation plan	0						(1,284)		1,284
Vesting of restricted share units (shares)					122,979
Distributions to non-controlling interest	(3,196)								(3,196)
Reallocation of non-controlling interest	0						(87)		87
Net income	12,759							7,958	4,801
Balance at end of period (shares) at Sep. 30, 2022		113,508,362	53,816,214		113,508,362	53,816,214
Balance at end of period at Sep. 30, 2022	$ 22,670				$ 1	$ 1	$ 104,539	$ (78,133)	$ (3,738)

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Cash Flows from Operating Activities
Net income	$ 24,711	$ 6,096
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	8,001	7,345
Amortization/write off of deferred financing costs	1,023	5,692
Equity-based compensation	11,887	6,404
Provision for obsolete or slow-moving inventory	443	435
Deferred taxes	5,299	640
Payable pursuant to the tax receivable agreement adjustment	0	3,678
Gain on sale of assets	0	61
Changes in assets and liabilities, net of business acquisition:
Accounts receivable	(40,084)	(12,271)
Unbilled receivables	1,972	(6,760)
Inventory	(43,601)	(8,505)
Other assets	(381)	(6,904)
Accounts payable	1,186	(5,198)
Accrued expenses and other	34,558	2,608
Net Cash Provided by (Used in) Operating Activities	5,014	(6,679)
Cash Flows Used In Investing Activities
Purchases of property, plant and equipment	(2,393)	(2,483)
Acquisition of a business, net of cash acquired	0	(12,909)
Other	(503)	0
Net Cash Used in Investing Activities	(2,896)	(15,392)
Cash Flows from Financing Activities
Distributions to non-controlling interest	(7,762)	(4,837)
Employee withholding taxes related to net settled equity awards	(1,297)	(137)
Deferred financing costs	0	(94)
Proceeds from revolving credit facility	46,000	40,140
Proceeds from issuance of Class A common stock sold in an IPO, net of underwriting discounts and commissions	0	154,521
Proceeds from issuance of Class A common stock in follow-on offering, net of underwriting discounts and commissions	0	281,064
Purchase of LLC Interests with proceeds from follow-on offering	0	(281,064)
Payment of debt assumed in acquisition	0	(1,537)
Deferred offering costs	0	(9,619)
Net Cash Provided By Financing Activities	19,941	26,187
Net Increase in Cash, Cash Equivalents and Restricted Cash	22,059	4,116
Cash, Cash Equivalents and Restricted Cash—Beginning of Period	9,557	10,073
Cash, Cash Equivalents and Restricted Cash—End of Period	31,616	14,189
Supplemental Cash Flows Information:
Cash paid for interest	8,376	7,683
Cash paid for taxes	767	1,176
Non-cash investing and financing activities:
Reclassification of deferred offering costs to additional paid-in capital	0	3,736
Recording of deferred tax assets	5,453	122,590
Recording of amounts payable pursuant to tax receivable agreement	4,629	104,202
Capital contribution related to tax receivable agreement	824	18,209
Income tax receivable from merger due to former owner	0	3,842
Deferred tax asset and additional paid-in capital from ConnectPV	0	405
Class A common stock issued in ConnectPV acquisition	0	6,500
Term Loan Facility
Cash Flows from Financing Activities
Payments on/ repayments of credit facilities	(1,500)	(152,250)
Revolving Credit Facility
Cash Flows from Financing Activities
Payments on/ repayments of credit facilities	$ (15,500)	$ 0

Organization and Business

Organization and Business	9 Months Ended
	Sep. 30, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Business	Organization and Business Shoals Technologies Group, Inc. (the “Company”) was formed as a Delaware corporation on November 4, 2020 for the purpose of facilitating an initial public offering ("IPO") and other related organizational transactions to carry on the business of Shoals Parent LLC and its subsidiaries (“Shoals Parent”). Shoals Parent is a Delaware limited liability company formed on May 9, 2017. The Company is headquartered in Portland, Tennessee and is a manufacturer of electrical balance of systems (“EBOS”) solutions and components for solar, battery storage and electric vehicle charging applications, selling to customers across the United States and internationally. Shoals Parent, through its wholly-owned subsidiaries, Shoals Intermediate Holdings LLC (“Intermediate”) and Shoals Holdings LLC (“Holdings”) owns five other subsidiaries through which it conducts substantially all operations: Shoals Technologies, LLC, Shoals Technologies Group, LLC, Solon, LLC, Shoals Structures, LLC (collectively “Shoals”) and Shoals Connect LLC. Shoals Parent acquired Shoals on May 25, 2017. On August 26, 2021, the Company acquired 100% of the stock of ConnectPV, Inc. (“ConnectPV”) with cash and Class A common stock. The acquisition was accounted for as a business combination and following the acquisition, the Company immediately converted ConnectPV to a limited liability company (Shoals Connect LLC) and contributed the entity to Shoals Parent, LLC through a series of transactions – see Note 3 - Acquisition of ConnectPV. Initial Public Offering On January 29, 2021, the Company completed an IPO of 11,550,000 shares of Class A common stock at a public offering price of $25.00 per share, including shares issued pursuant to the underwriters' over-allotment option. The Company received $278.8 million in proceeds, net of underwriting discounts and commissions of $9.9 million, which was used to purchase 6,315,790 newly-issued membership interests (“LLC Interests”) from Shoals Parent and 5,234,210 LLC Interests from the founder and Class B unit holder in Shoals Parent at a price per interest equal to the IPO price of $25.00 per share. Organizational Transactions In connection with the IPO, the Company and Shoals Parent completed a series of transactions (the "Organizational Transactions") including the following: • the limited liability company agreement (the “LLC Agreement”) of Shoals Parent was amended and restated to, among other things, (i) provide for a new single class of LLC Interests in Shoals Parent, (ii) exchange all of the then existing membership interests of the holders of Shoals Parent membership interests for LLC Interests and (iii) appoint the Company as the sole managing member of Shoals Parent; • the Company's certificate of incorporation was amended and restated to, among other things, (i) provide for Class A common stock with voting and economic rights (ii) provide for Class B common stock with voting rights but no economic rights and (iii) issue 78,300,817 shares of Class B common stock to the former Class B and Class C members of Shoals Parent (the “Continuing Equity Owners”) on a one-to-one basis with the number of LLC Interests they own; and • the acquisition, by merger, of Shoals Investment CTB or the former Class A member of Shoals Parent (the "Class A Shoals Equity Owners"), for which the Company issued 81,977,751 shares Class A common stock as merger consideration (the "Merger"). Follow-On Offering On July 16, 2021, the Company completed a follow-on offering consisting of 4,989,692 shares of Class A common stock offered by selling shareholders and 10,402,086 shares of Class A common stock offered by the Company. The Company used the proceeds of the sale of Class A common stock to purchase an equal number of LLC Interests and Class B common stock from our founder and management.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2022
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies Basis of Accounting and Presentation The condensed consolidated financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Reclassifications Certain prior period amounts have been reclassified to conform to the current period presentation. Non-controlling Interest The non-controlling interest on the consolidated statement of operations represents the portion of earnings or loss attributable to the economic interest in the Company's subsidiary, Shoals Parent, held by the Continuing Equity Owners. Non-controlling interest on the condensed consolidated balance sheet represents the portion of net assets of the Company attributable to the Continuing Equity Owners, based on the portion of the LLC Interests owned by such unit holders. As of September 30, 2022, the non-controlling interest was 32.16%. Unaudited Interim Financial Information The accompanying condensed consolidated balance sheets as of September 30, 2022 and December 31, 2021, the statements of operations, stockholders’ equity (deficit) and cash flows for the periods ended September 30, 2022 and 2021 are unaudited. The unaudited interim financial statements have been prepared on the same basis as the audited annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of September 30, 2022 and the results of its operations and its cash flows for the periods ended September 30, 2022 and 2021. The financial data and other information disclosed in these notes related to the three and nine months ended September 30, 2022 and 2021 are also unaudited. The results for the three and nine months ended September 30, 2022 and 2021 are not necessarily indicative of results to be expected for the year ending December 31, 2022, any other interim periods, or any future year or period. The balance sheet as of December 31, 2021 included herein was derived from the audited financial statements as of that date. Certain disclosures have been condensed or omitted from the interim financial statements. These financial statements should be read in conjunction with the Company’s consolidated financial statements and related notes thereto included in the Company’s 2021 Form 10-K. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include revenue recognition, allowance for doubtful accounts, useful lives of property, plant and equipment and other intangible assets, impairment of long-lived assets, allowance for slow moving inventory, payable pursuant to the tax receivable agreement (“TRA”) and valuation allowance on deferred tax assets. Restricted Cash Restricted cash is included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Restricted cash is restricted as to withdrawal or use. Tax distributions paid by Shoals Parent to the Company are restricted under the LLC Agreement for future payments under the TRA and totaled $20.4 million and $4.6 million as of September 30, 2022 and December 31, 2021, respectively. A reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheet is as follows (in thousands): September 30, December 31, 2021 Cash and cash equivalents $ 11,202 $ 5,006 Restricted cash included in other current asset 3,583 — Restricted cash included in other assets 16,831 4,551 Total cash, cash equivalents and restricted cash $ 31,616 $ 9,557 Impact of COVID-19 Pandemic and Macroeconomic Events In 2022, COVID-19 has impacted our business in the following ways: • Our ability to obtain raw material and required components from domestic and international suppliers required to manufacture our products; and • Our ability to secure inbound and outbound logistics to and from our facilities, with additional delays linked to international border crossings and the associated approvals and documentation and; Significant levels of inflation have increased energy prices, freight premiums, and other operating costs. As a result of inflation, during 2022, the Federal Reserve increased interest rates resulting in higher interest rates associated with our Senior Secured Credit Agreement, as defined below. Any additional increases in interest rates by the Federal Reserve would have a corresponding increase in the interest rates charged under our Senior Secured Credit Agreement. The eventual implications of higher government deficits and debt, tighter monetary policy, and potentially higher long-term interest rates may drive a higher cost of capital during our forecast period. The Company does not directly source raw materials from Europe. However, the ongoing conflict in Ukraine has reduced the availability of certain material that can be sourced in Europe and, as a result, increased global logistics costs for the procurement of some inputs and materials used in our products. We do not know the ultimate severity or duration of the conflict in Ukraine, but we are continuously monitoring the situation and evaluating our procurement strategy and supply chain as to reduce any negative impact on our business, financial condition, and results of operations. As response to supply chain constraints, in 2022 we have increased certain raw materials inventory, partly to limit the potential impact of supply chain issues of raw materials in the near term. To date we have not had any material adverse effects on our financial results from these events. Customer Concentrations The Company had the following revenue concentrations representing 10% or more of revenue for the nine months ended September 30, 2022 and 2021 and related accounts receivable concentrations as of September 30, 2022 and December 31, 2021: 2022 2021 Revenue % Accounts Revenue % Accounts Customer A 9.0 % 7.1 % 22.5 % 15.8 % Customer B 6.9 % 3.3 % 11.8 % 4.6 % Recent Accounting Pronouncements Adopted On January 1, 2022, the Company adopted Accounting Standards Update (“ASU”) No. 2016-02 (Topic 842) “Leases” which supersedes the lease recognition requirements in Accounting Standards Codification (“ASC”) Topic 840, “Leases” . Under ASU No. 2016-02, lessees are required to recognize assets and liabilities on the consolidated balance sheets for most leases and provide enhanced disclosures. For companies that are not emerging growth companies (“EGCs”), the ASU was effective for fiscal years beginning after December 15, 2018. For EGCs, the ASU is effective for fiscal years beginning after December 15, 2021. The Company adopted the new standard using the modified retrospective method by recording a right-of-use asset of $1.2 million, short-term portion of lease liabilities of $0.4 million and long-term portion of lease liabilities of $0.8 million as of the effective date. Prior periods will not be restated and will continue to be reported under Topic 840 guidance in effect during those periods. The Company applied the package of practical expedients to leases that commenced before the effective date whereby the Company elected to not reassess the following: (i) whether any expired or existing contracts contain leases; (ii) the lease classification for any expired or existing leases; and (iii) initial direct costs for any existing leases. The adoption did not have a material impact on its consolidated statements of operations or its consolidated statements of cash flows. See Note 14 - Leases for further information and disclosures related to the adoption of this standard. Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses , which was subsequently amended by ASU No. 2018-19 and ASU No. 2019-10, and which requires the measurement of expected credit losses for financial instruments carried at amortized cost held at the reporting date based on historical experience, current conditions and reasonable forecasts. The updated guidance also amends the current other-than-temporary impairment model for available-for-sale debt securities by requiring the recognition of impairments relating to credit losses through an allowance account and limits the amount of credit loss to the difference between a security’s amortized cost basis and its fair value. In addition, the length of time a security has been in an unrealized loss position will no longer impact the determination of whether a credit loss exists. The main objective of this ASU is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. For EGC’s, the standard is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2022. The Company will continue to assess the possible impact of this standard, but currently does not expect the adoption of this standard will have a significant impact on its financial statements and its limited history of bad debt expense relating to trade accounts receivable. In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805) Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . This ASU requires that contract assets and contract liabilities acquired in a business combination be recognized and measured in accordance with Topic 606. At the acquisition date, an acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. This guidance is effective for fiscal years beginning after December 15, 2022, including interim periods within that fiscal year. Early adoption of the amendments is permitted, including adoption in an interim period. An entity that early adopts in an interim period should apply the amendments (1) retrospectively to all business combinations for which the acquisition date occurs on or after the beginning of the fiscal year that includes the interim period of early application and (2) prospectively to all business combinations that occur on or after the date of initial application. We are currently evaluating the impact of the new standard on our financial statements and related disclosures. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements.

Acquisition of ConnectPV

Acquisition of ConnectPV	9 Months Ended
	Sep. 30, 2022
Business Combination and Asset Acquisition [Abstract]
Acquisition of ConnectPV	Acquisition of ConnectPV On August 26, 2021, the Company acquired 100% of the common stock of ConnectPV. The acquisition of ConnectPV was accounted for as a business combination using the acquisition method of accounting. The aggregate purchase price was $13.8 million in cash (net of $0.8 million cash acquired) and 209,437 shares of Class A Common stock valued at $6.5 million. The cash portion of the purchase price was funded by borrowing under our Revolving Credit Facility (as defined below). The purchase price paid has been allocated to record the acquired assets and assumed liabilities based upon their estimated fair value pending finalization of the working capital calculation with the sellers. When determining the fair values of the assets acquired and assumed liabilities, management made significant estimates, judgements and assumptions. Management estimated that consideration paid exceeded the fair value of the net assets acquired. Therefore, goodwill of $19.8 million was recorded. The goodwill recognized was primarily attributable to the workforce and synergies related to the Company’s EBOS solutions and components business that are expected to arise from the ConnectPV acquisition. The following table is the balance sheet of ConnectPV as of the acquisition date, August 26, 2021, and includes the estimated fair value of the assets acquired and assumed liabilities. The estimated fair value allocated to certain property, plant and equipment, identifiable intangible assets and goodwill was determined based on a combination of market, cost and income approaches with the assistance of a third-party valuation firm (in thousands): Purchase Price Allocation Cash and cash equivalents $ 849 Accounts receivable 5,382 Inventory 4,273 Other current assets 1,583 Total current assets 12,087 Property, plant and equipment 438 Goodwill 19,765 Other intangible assets 1,600 Total Assets 33,890 Accounts payable 9,440 Accrued expenses 2,655 Debt 1,537 Total liabilities 13,632 Net assets acquired $ 20,258 Pro Forma Financial Information (Unaudited) The pro forma information below gives effect to the ConnectPV acquisition as if it had been completed on the first day of each period presented. The pro forma results of operations are presented for informational purposes only. As such, they are not necessarily indicative of the Company’s results had the acquisition been completed on the first day of each period presented, nor do they intend to represent the Company’s future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisition and does not reflect additional revenue opportunities following the acquisition. The pro forma information includes adjustments to record the assets and liabilities associated with the acquisition at their respective fair values, based on available information and to give effect to the financing for the acquisition (in thousands): Nine Months Ended Revenue $ 181,663 Net income $ 4,226

Accounts Receivable

Accounts Receivable	9 Months Ended
	Sep. 30, 2022
Receivables [Abstract]
Accounts Receivable	Accounts ReceivableAccounts receivable consists of the following (in thousands): September 30, December 31, 2021 Accounts receivable $ 71,938 $ 32,015 Less: allowance for doubtful accounts (286) (516) Accounts receivable, net $ 71,652 $ 31,499

Inventory

Inventory	9 Months Ended
	Sep. 30, 2022
Inventory Disclosure [Abstract]
Inventory	Inventory Inventory consists of the following (in thousands): September 30, December 31, 2021 Raw materials $ 82,451 $ 39,265 Allowance for obsolete or slow-moving inventory (1,293) (897) Inventory, net $ 81,158 $ 38,368

Property, Plant and Equipment

Property, Plant and Equipment	9 Months Ended
	Sep. 30, 2022
Property, Plant and Equipment [Abstract]
Property, Plant and Equipment	Property, Plant and Equipment Property, plant, and equipment, net consists of the following (in thousands): Estimated Useful Lives (Years) September 30, December 31, 2021 Land N/A $ 840 $ 840 Building and land improvements 5-40 8,833 7,801 Machinery and equipment 3-5 11,970 10,693 Furniture and fixtures 3-7 1,797 1,775 Vehicles 5 127 65 23,567 21,174 Less: accumulated depreciation (6,971) (5,600) Property, plant and equipment, net $ 16,596 $ 15,574 Depreciation expense for the three months ended September 30, 2022 and 2021 was $0.5 million and $0.5 million, respectively. During the three months ended September 30, 2022 and 2021, $0.4 million and $0.4 million, respectively, of depreciation expense was allocated to cost of revenue and $0.1 million and $0.1 million, respectively, of depreciation expense was allocated to operating expenses. Depreciation expense for the nine months ended September 30, 2022 and 2021 was $1.4 million and $1.3 million, respectively. During the nine months ended September 30, 2022 and 2021, $1.1 million and $1.0 million, respectively, of depreciation expense was allocated to cost of revenue and $0.3 million and $0.3 million, respectively, of depreciation expense was allocated to operating expenses.

Goodwill and Other Intangible A

Goodwill and Other Intangible Assets	9 Months Ended
	Sep. 30, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill and Other Intangible Assets	Goodwill and Other Intangible Assets Goodwill Goodwill relates to the acquisition of Shoals and ConnectPV. As of September 30, 2022 and December 31, 2021, goodwill totaled $69.9 million and $69.4 million, respectively. Changes in the carrying amount of goodwill during the nine months ended September 30, 2022 are shown below (in thousands): Goodwill Beginning Balance $ 69,436 Adjustments related to finalization of working capital in the acquisition of ConnectPV 505 Ending Balance $ 69,941 Other Intangible Assets Other intangible assets consists of the following (in thousands): Estimated Useful Lives (Years) September 30, December 31, 2021 Amortizable: Costs: Customer relationships 13 $ 53,100 $ 53,100 Developed technology 13 34,600 34,600 Trade names 13 11,900 11,900 Backlog 1 600 600 Noncompete agreements 5 2,000 2,000 Total amortizable intangibles 102,200 102,200 Accumulated amortization: Customer relationships 21,851 18,629 Developed technology 14,195 12,199 Trade names 4,948 4,103 Backlog 600 200 Noncompete agreements 2,000 1,833 Total accumulated amortization 43,594 36,964 Total amortizable intangibles, net $ 58,606 $ 65,236 Amortization expense related to intangible assets amounted to $2.1 million and $2.1 million for the three months ended September 30, 2022 and 2021 and $6.6 million and $6.1 million for the nine months ended September 30, 2022 and 2021, respectively.

Accrued Expenses and Other

Accrued Expenses and Other	9 Months Ended
	Sep. 30, 2022
Payables and Accruals [Abstract]
Accrued Expenses and Other	Accrued Expenses and Other Accrued expenses and other consists of the following (in thousands): September 30, December 31, 2021 Accrued compensation $ 3,838 $ 2,882 Deferred revenue 28,720 1,841 September 30, December 31, 2021 Accrued interest 6,276 3,095 Accrued professional fees 595 548 Lease liability 1,139 — Other accrued expenses 2,839 1,203 Total accrued expenses and other $ 43,407 $ 9,569

Long-Term Debt

Long-Term Debt	9 Months Ended
	Sep. 30, 2022
Debt Disclosure [Abstract]
Long-Term Debt	Long-Term Debt Long-term debt consists of the following (in thousands): September 30, December 31, 2021 Term Loan Facility $ 195,750 $ 197,250 Revolving Credit Facility 85,640 55,140 Less: deferred financing costs (4,461) (5,337) Total debt, net of deferred financing costs 276,929 247,053 Less: current portion (2,000) (2,000) Long-term debt, less current portion $ 274,929 $ 245,053 Senior Secured Credit Agreement On November 25, 2020 Shoals Holdings, entered into a senior secured credit agreement (the “Senior Secured Credit Agreement”), consisting of (i) a $350.0 million senior secured six-year term loan facility (the “Term Loan Facility”), (ii) a $30.0 million senior secured delayed draw term loan facility, which matures concurrently with the six-year Term Loan Facility (the “Delayed Draw Term Loan Facility”) and (iii) an uncommitted super senior first out revolving credit facility (the “Revolving Credit Facility”). In December 2020, Shoals Holdings entered into two amendments to the Senior Secured Credit Agreement in order to obtain a $100.0 million increase (the “Revolver Upsize”) to the Revolving Credit Facility and modify the terms of the interest rate and prepayment premium. As part of the first amendment the Company repaid and terminated all outstanding commitments under the Delayed Draw Term Loan Facility. On January 29, 2021, the Company used proceeds from the IPO to repay $150.0 million of outstanding borrowings under the Term Loan Facility. The repayment of a portion of the borrowings under the Term Loan Facility resulted in a $16.0 million loss on debt repayment as the result of the $11.3 million prepayment premium and $4.7 million write-off of a portion of the deferred financing costs. On May 2, 2022, Shoals Holdings entered into an amendment to the Senior Secured Credit Agreement in order to increase the amount available for borrowing under the Revolving Credit Facility from $100.0 million to $150.0 million. The amendment also set forth SOFR as the benchmark rate to succeed LIBOR and amended the financial covenant such that, commencing with September 30, 2022, Shoals Holdings shall not permit its Consolidated First Lien Secured Leverage Ratio (as defined in the Senior Secured Credit Agreement) to exceed 6.50:1.00. As of September 30, 2022, interest rates on the Term Loan Facility was SOFR plus 3.25%, or 5.94%, and the Revolving Credit Facility was SOFR plus 3.25%, ranging from 5.41% to 6.89%. As of September 30, 2022, the Company had $64.4 million of availability under the Revolving Credit Facility. The Senior Secured Credit Agreement contains affirmative and negative covenants, including covenants that restrict the Company’s incurrence of indebtedness, incurrence of liens, dispositions, investments, acquisitions, restricted payments, and transactions with affiliates. The Senior Secured Credit Agreement also includes customary events of default, including the occurrence of a change of control. As of September 30, 2022, the Company was in compliance with all the required covenants.

Earnings per Share ("EPS")

Earnings per Share ("EPS")	9 Months Ended
	Sep. 30, 2022
Earnings Per Share [Abstract]
Earnings per Share ("EPS")	Earnings per Share ("EPS") Basic EPS of Class A Common Stock is computed by dividing net income (loss) attributable to the Company by the weighted average number of shares of Class A Common Stock outstanding during the period. Diluted EPS of Class A Common Stock is computed similarly to basic EPS except the weighted average shares outstanding are increased to include additional shares from the exchange of Class B Common Stock under the if-converted method and the assumed exercise of any common stock equivalents using the treasury stock method, if dilutive. The Company’s restricted stock units are considered common stock equivalents for this purpose. All earnings prior to and up to January 26, 2021, the date of the IPO, were entirely allocable to non-controlling interest and, as a result, EPS information is not applicable for reporting periods prior to this date. Consequently, only the net income allocable to Shoals Technologies Group, Inc. from the period subsequent to January 26, 2021 is included in the net loss attributable to the stockholders of Class A Common Stock for the periods ended September 30, 2021. Basic and diluted EPS of Class A Common Stock have been computed as follows (in thousands, except per share amounts): Three Months Ended Nine Months Ended Period from January 27, 2021 2022 2021 Numerator: Net income attributable to Shoals Technologies Group, Inc. - basic $ 7,958 $ 2,486 $ 15,000 $ 1,510 Reallocation of net income attributable to non-controlling interests from the assumed conversion of Class B common stock — — — — Net income attributable to Shoals Technologies Group, Inc. - diluted $ 7,958 $ 2,486 $ 15,000 $ 1,510 Denominator: Weighted average shares of Class A common stock outstanding - basic 112,975 101,890 112,561 96,354 Three Months Ended Nine Months Ended Period from January 27, 2021 2022 2021 Effect of dilutive securities: Restricted / Performance Stock Units 609 361 255 173 Class B Common Stock — — — — Weighted average shares of Class A common stock outstanding - diluted 113,584 102,251 112,816 96,527 Earnings (loss) per share of Class A common stock - basic $ 0.07 $ 0.02 $ 0.13 $ 0.02 Earnings (loss) per share of Class A common stock - diluted $ 0.07 $ 0.02 $ 0.13 $ 0.02

Equity-Based Compensation

Equity-Based Compensation	9 Months Ended
	Sep. 30, 2022
Share-Based Payment Arrangement [Abstract]
Equity-Based Compensation	Equity-Based Compensation 2021 Long-term Incentive Plan On January 26, 2021, the Shoals Technologies Group, Inc. 2021 Long-Term incentive Plan (the “2021 Incentive Plan”) became effective. The 2021 Incentive Plan authorized 8,768,124 new shares, subject to adjustment pursuant to the 2021 Incentive Plan. Restricted Stock Units During the nine months ended September 30, 2022, the Company granted 665,179 restricted stock units (“RSUs") to certain employees, officers and directors of the Company. The RSUs have grant date fair values ranging from $10.42 to $25.05 per unit and generally vest ratably over 3 years, except for some officer and employee grants for bonuses which immediately vested. Activity under the 2021 Incentive Plan for RSUs was as follows: Restricted Weighted Average Price Outstanding, December 31, 2021 1,632,844 $ 27.58 Granted 665,179 $ 13.06 Vested (559,336) $ 26.05 Forfeited (56,461) $ 26.10 Outstanding, September 30, 2022 1,682,226 $ 22.38 Performance Stock Units During the nine months ended September 30, 2022, the Company granted an aggregate of 242,907 Performance Stock Units ("PSUs") to certain executives. The PSUs cliff vest after 3 years upon meeting certain revenue and gross margin targets and contain certain modifiers which could increase or decrease the ultimate number of Class A common stock issued to the executives. The PSUs were valued using the market value of the Class A common stock on the grant date ranging from $10.42 to $12.60 per PSUs. Based on results achieved in 2022 and the forecasted amounts over the remainder of the performance period, the Company expects the units to vest and the modifier to be achieved related to the gross margin target. Activity under the 2021 Incentive Plan for PSUs was as follows: Performance Weighted Average Price Outstanding, December 31, 2021 — $ — Granted 242,907 $ 11.41 Vested — $ — Forfeited — $ — Outstanding, September 30, 2022 242,907 $ 11.41 The Company recognized equity-based compensation of $4.0 million and $2.7 million for the three months ended September 30, 2022 and 2021, respectively, and $11.9 million and $6.9 million for the nine months ended September 30, 2022 and 2021, respectively. As of September 30, 2022, the Company had $34.6 million of unrecognized compensation costs which is expected to be recognized over a period of 2.3 years.

Stockholders' Equity (Deficit)

Stockholders' Equity (Deficit)	9 Months Ended
	Sep. 30, 2022
Equity [Abstract]
Stockholders' Equity (Deficit)	Stockholders' Equity (Deficit) Amendment and Restatement of Certificate of Incorporation As discussed in Note 1, on January 26, 2021, the Company's certificate of incorporation was amended and restated to, among other things, provide for the (i) authorization of 1,000,000,000 shares of Class A common stock with a par value of $0.00001 per share; (ii) authorization of 195,000,000 shares of Class B common stock with a par value of $0.00001 per share; (iii) authorization of 5,000,000 shares of preferred stock that may be issued from time to time by the Company's Board of Directors in one or more series; and (iv) establishment of a classified board of directors, divided into three classes, the members of which will serve for staggered terms. Holders of Class A common stock and Class B common stock are entitled to one vote per share and, except as otherwise required, will vote together as a single class on all matters on which stockholders generally are entitled to vote. Holders of Class B common stock are not entitled to receive dividends and will not be entitled to receive any distributions upon the liquidation, dissolution or winding up of the Company. Shares of Class B common stock may only be issued to the extent necessary to maintain the one-to-one ratio between the number of LLC Interests held by the Continuing Equity Owners and the number of shares of Class B common stock held by the Continuing Equity Owners. Shares of Class B common stock are transferable only together with an equal number of LLC Interests. Shares of Class B common stock will be canceled on a one-for-one basis if the Company, at the election of a Continuing Equity Owner, redeem or exchange LLC Interests. The Company must, at all times, maintain a one-to-one ratio between the number of shares of Class A common stock issued by the Company and the number of LLC Interests owned by the Company (subject to certain exceptions for treasury shares and shares underlying certain convertible or exchangeable securities). Initial Public Offering As discussed in Note 1, on January 29, 2021, the Company closed an IPO of 11,550,000 shares of the Class A common stock at a public offering price of $25.00 per share. The Company received $278.8 million in proceeds, net of underwriting discounts and commissions, which was used to purchase 6,315,790 LLC Interests from Shoals Parent and 5,234,210 LLC Interests from the founder and Class B unit holder in Shoals Parent at a price per interest equal to the IPO price of the Class A common stock of $25.00. Shoals Parent Recapitalization As noted above, in connection with the IPO, the limited liability company agreement of Shoals Parent was amended and restated to, among other things, (i) provide for a new single class of common membership interests in Shoals Parent, or the LLC Interests; (ii) exchange all of the then existing membership interests of the Continuing Equity Owners for LLC Interests (iii) exchange all the then existing membership interest of the Class A Shoals Equity Owners for LLC Interests and (iv) appoint the Company as the sole managing member of Shoals Parent. The Company has a majority economic interest in, is the sole managing member of, has the sole voting power in, and controls the management of Shoals Parent. The amendment also requires that Shoals Parent, at all times, maintain (i) a one-to-one ratio between the number of shares of Class A common stock issued by the Company and the number of LLC Interests owned by the Company and (ii) a one-to-one ratio between the number of shares of Class B common stock owned by the Continuing Equity Owners and the number of LLC Interests owned by the Continuing Equity Owners. Acquisition of Former Shoals Equity Owners On January 26, 2021, the Company acquired, by merger, an entity that was a member of Shoals Parent, or the Class A Shoals Equity Owners, for which the Company issued 81,977,751 shares of Class A common stock as merger consideration. The only assets held by the Class A Shoals Equity Owners were 81,977,751 LLC Interests. Upon consummation of the merger, the Company recognized the LLC Interests at carrying value, as the merger is considered to be a transaction between entities under common control.

Non-Controlling Interests

Non-Controlling Interests	9 Months Ended
	Sep. 30, 2022
Noncontrolling Interest [Abstract]
Non-Controlling Interests	Non-Controlling InterestsAs of September 30, 2022, the Company owned 67.84% of Shoals Parent. The following table summarizes the effects of the changes in ownership in Shoals Parent on equity: Nine Months Ended Period from January 27, 2021 Net income attributable to non-controlling interest $ 9,711 $ 1,911 Transfers to non-controlling interests Decrease as a result of the Organizational Transactions — (88,644) Increase as a result of newly issued LLC Interests in IPO — 70,976 Increase as a result of activity under equity-based compensation plan 4,257 2,607 Decrease from tax distributions to non-controlling interest (7,762) (4,837) Reallocation of non-controlling interest 107 6,005 Change from net income attributable to/from non-controlling interest and transfers to non-controlling interest $ 6,313 $ (11,982) Issuance of Additional LLC Interests Under the LLC Agreement, the Company is required to cause Shoals Parent to issue additional LLC Interests to the Company when the Company issues additional shares of Class A Common Stock. Other than as it relates to the issuance of Class A Common Stock in connection with an equity incentive program, the Company must contribute to Shoals Parent net proceeds and property, if any, received by the Company with respect to the issuance of such additional shares of Class A Common Stock. The Company must cause Shoals Parent to issue a number of LLC Interests equal to the number of shares of Class A Common Stock issued such that, at all times, the number of LLC Interests held by the Company equals the number of outstanding shares of Class A Common Stock. During the nine months ended September 30, 2022, the Company caused Shoals Parent to issue to the Company a total of 480,116 LLC Interests for the vesting of awards granted under the Shoals Technologies Group, Inc. 2021 Long-Term Incentive Plan. Distributions for Taxes As a limited liability company (treated as a partnership for income tax purposes), Shoals Parent does not incur significant federal, state or local income taxes, as these taxes are primarily the obligations of its members. As authorized by the LLC Agreement, Shoals Parent is required to distribute cash, to the extent that Shoals Parent has cash available, on a pro rata basis, to its members to the extent necessary to cover the members’ tax liabilities, if any, with respect to each member’s share of Shoals Parent taxable earnings. Shoals Parent makes such tax distributions to its members quarterly, based on the single highest marginal tax rate applicable to its members applied to projected year-to-date taxable income, with a final accounting once actual taxable income or loss has been determined. During the nine months ended September 30, 2022 and 2021, tax distributions to non-controlling LLC Interests holders was $7.8 million and $4.8 million, respectively. Other Distributions Pursuant to the LLC Agreement, the Company has the right to determine when distributions will be made to LLC members and the amount of any such distributions. If the Company authorizes a distribution, such distribution will be made to the members of the LLC (including the Company) pro rata in accordance with the percentages of their respective LLC units.

Leases

Leases	9 Months Ended
	Sep. 30, 2022
Leases [Abstract]
Leases	Leases Effective January 1, 2021, the Company adopted ASC 842 Leases using the modified retrospective approach. The Company elected the use of the package of practical expedients permitted under the transition guidance which allows the Company not to reassess whether a contract contains a lease, carry forward the historical lease classification and not reassess initial direct lease costs. The Company also elected to apply the short-term measurement and recognition exemption in which the right-of-use (“ROU”) assets and lease liabilities are not recognized for short-term leases. Adoption of this standard resulted in recording of net operating lease ROU assets and corresponding operating lease liabilities of $1.2 million and $1.2 million, respectively. The standard did not materially affect the condensed consolidated statements of income and had no impact on the condensed consolidated statements of cash flows. The following table summarizes the balances as it relates to leases at the end of the period (in thousands): (*) September 30, ROU asset Other assets $ 4,358 Lease liability, current portion Accrued expenses and other $ 1,139 Lease liability, long-term portion Other long-term liabilities 3,553 Total lease liability $ 4,692 (*) Location on the condensed consolidated balance sheet The Company determines if an arrangement is a lease at its inception. Operating lease ROU assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Operating lease ROU assets also include any initial direct costs and prepayments less lease incentives. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. As the Company’s leases generally do not provide an implicit rate, the Company uses its collateralized incremental borrowing rate based on the information available at the lease commencement date, including lease term, in determining the present value of lease payments. Lease expense for these leases is recognized on a straight-line basis over the lease term. Operating lease arrangements are comprised primarily of real estate and equipment agreements for which the right-of-use assets are included in other assets and the corresponding lease liabilities, depending on their maturity, are included in accrued liabilities or other long-term liabilities in the condensed consolidated balance sheets. The Company also elected to apply the practical expedient to consider non-lease components as a part of the lease. The Company's leases contain certain non-lease components for common area maintenance which are variable on a month to month basis and as such recorded as a variable lease expense as incurred. The details of the Company’s operating leases are as follows (in thousands): Three Months Ended Nine Months Ended Operating lease expense $ 297 $ 829 Variable lease expense 51 176 Short-term lease expense — 91 Total lease expense $ 348 $ 1,096 The following table presents the maturities of lease liabilities (in thousands): Fiscal year ending December 31, Operating Leases 2022 $ 326 2023 1,339 2024 1,264 2025 960 2026 952 Thereafter 246 Total lease payments 5,087 Less: Imputed lease interest (395) Total lease liabilities $ 4,692 The following table represents future minimum lease obligations under non-cancelable operating leases (in thousands): Fiscal year ending December 31, Operating Leases 2022 $ 489 2023 499 2024 200 2025 58 2026 6 Total $ 1,252 The Company’s weighted-average remaining lease-term and weighted-average discount rate are as follows (in thousands): Nine Months Ended Weighted average remaining lease-term 4.1 years Weighted average discount rate 4.5 % Supplemental cash flow and other information related to operating leases are as follows: Nine Months Ended Operating cash flows from operating leases $ 918 Non cash investing activities: Lease liabilities arising from obtaining right-of-use assets as of January 1, 2022 $ 1,239 Lease liabilities arising from obtaining right-of-use assets during the nine months ended September 30, 2022 $ 3,990

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2022
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Litigation The Company is from time to time subject to legal proceedings and claims, which arise in the normal course of its business. In the opinion of management and legal counsel, the amount of losses that may be sustained, if any, would not have a material effect on the financial position, results of operations or cash flows of the Company. Surety Bonds The Company provides surety bonds to various parties as required for certain transactions initiated during the ordinary course of business to guarantee the Company’s performance in accordance with contractual or legal obligations. As of September 30, 2022, the maximum potential payment obligation with regard to surety bonds was $16.0 million. Employee Benefit Plan The Company has a 401(k) retirement plan for substantially all of its employees based on certain eligibility requirements. Effective January 1, 2021 the Company began making matching contributions to the plan and may also provide discretionary contributions to the plan at the discretion of management. No such discretionary contributions have been made since inception of the plan. For the nine months ended September 30, 2022 and 2021, the Company made matching contributions totaling $0.3 million and $0.1 million, respectively.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2022
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes In August 2022, the U.S. President signed into law the Inflation Reduction Act of 2022 (the “IRA”), which revised U.S. tax law by, among other things, including a new corporate alternative minimum tax (the “CAMT”) of 15% on certain large corporations, imposing a 1% excise tax on stock buybacks, and providing incentives to address climate change, including the introduction of advanced manufacturing production tax credits. The provisions of the IRA are generally effective for tax years beginning after 2022. Given the complexities of the IRA, which is pending technical guidance and regulations from the Internal Revenue Service and U.S. Treasury Department, we will continue to monitor these developments and evaluate the potential future impact to our results of operations. The Company is taxed as a subchapter C corporation and is subject to federal and state income taxes. The Company’s sole material asset is Shoals Parent, which is a limited liability company that is taxed as a partnership for US federal and certain state and local income tax purposes. Shoals Parent’s net taxable income and related tax credits, if any, are passed through to its members and included in the member’s tax returns. Shoals Parent is subject to and reports an entity level tax in various states. The income tax burden on the earnings taxed to the noncontrolling interest holders is not reported by the Company in its consolidated financial statements under U.S. GAAP. As a result, the Company’s effective tax rate differs materially from the statutory rate. Our effective income tax rate for the nine months ended September 30, 2022 and 2021, was 18.2% and 105.0% respectively. In calculating the provision for interim income taxes, in accordance with ASC Topic 740, an estimated annual effective tax rate is applied to year-to-date ordinary income. At the end of each interim period, the Company estimates the effective tax rate expected to be applicable for the full fiscal year. This differs from the method utilized at the end of an annual period. For annual periods, the Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than-not that the deferred tax assets will be realized. Deferred tax assets and liabilities are calculated by applying existing tax laws and the rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the year of the enacted rate change. The Company accounts for uncertainty in income taxes using a recognition and measurement threshold for tax positions taken or expected to be taken in a tax return, which are subject to examination by federal and state taxing authorities. The tax benefit from an uncertain tax position is recognized when it is more likely than not that the position will be sustained upon examination by taxing authorities based on technical merits of the position. The amount of the tax benefit recognized is the largest amount of the benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The effective tax rate and the tax basis of assets and liabilities reflect management’s estimates of the ultimate outcome of various tax uncertainties. The Company recognizes penalties and interest related to uncertain tax positions within the provision (benefit) for income taxes line in the accompanying consolidated statements of operations. As of the quarter ended September 30, 2022, the Company has recorded $1.0 million of gross unrecognized tax benefits inclusive of interest and penalties, all of which, if recognized, would favorably impact the effective tax rate. The Company recognizes penalties and interest related to uncertain tax positions within the provision (benefit) for income taxes line in the accompanying consolidated statements of operations. The Company files U.S. federal and certain state income tax returns. The income tax returns of the Company are subject to examination by U.S. federal and state taxing authorities for various time periods, depending on those jurisdictions’ rules, generally after the income tax returns are filed.

Payable Pursuant to the Tax Rec

Payable Pursuant to the Tax Receivable Agreement	9 Months Ended
	Sep. 30, 2022
Tax Receivable Agreement [Abstract]
Payable Pursuant to the Tax Receivable Agreement	Payable Pursuant to the Tax Receivable AgreementThe Company has a TRA with the TRA Owners that provides for the payment by the Company to the TRA Owners (or their permitted assignees) of 85% of the amount of the benefits, if any, that the Company actually realizes or is deemed to realize as a result of (i) the Company’s allocable share of existing tax basis acquired in connection with the Organizational Transactions (including Blocker’s share of existing tax basis) and increases to such allocable share of existing tax basis, (ii) certain increases in the tax basis of assets of Shoals Parent and its subsidiaries resulting from purchases or exchanges of LLC Interests, and (iii) certain other tax benefits related to the Company entering into the TRA, including those attributable to payments made under the TRA. These contractual payment obligations are obligations of the Company and not of Shoals Parent. The Company’s payable pursuant to the TRA was determined on an undiscounted basis in accordance with ASC 450, Contingencies, since the contractual payment obligations were deemed to be probable and reasonably estimable. For purposes of the TRA, the benefit deemed realized by the Company is computed by comparing the actual income tax liability of the Company (calculated with certain assumptions) to the amount of such taxes that the Company would have been required to pay had there been no increase to the tax basis of the assets of Shoals Parent as a result of the purchases or exchanges, and had the Company not entered into the TRA. The following table reflects the changes to the Company's payable pursuant to the tax receivable agreement (in thousands): Nine Months Ended 2022 2021 Beginning balance $ 156,374 $ — Additions to TRA: Exchange of LLC Interests for Class A Common Stock 4,629 92,376 Merger of Shoals investment CTB — 13,490 Adjustment for change in estimated effective income tax rate — 2,014 Payments under TRA — — Payable pursuant to TRA 161,003 107,880 Less: current portion (3,583) — Payable pursuant to TRA, less current portion $ 157,420 $ 107,880 The TRA further provides that, upon certain mergers, asset sales or other forms of business combinations or other changes of control, or if the Company materially breaches any of its material obligations under the TRA, the Company (or its successor) would owe to the TRA Owners a lump-sum payment equal to the present value of all forecasted future payments that would have otherwise been made under the TRA that would be based on certain assumptions, including a deemed exchange of LLC Interests and that the Company would have sufficient taxable income to fully utilize the deductions arising from the increased tax basis and other tax benefits related to entering into the TRA. The Company also is entitled to terminate the TRA, which, if terminated, would obligate the Company to make early termination payments to the TRA Owners. When estimating the expected tax rate to use in order to determine the tax benefit expected to be recognized from the Company’s increased tax basis as a result of exchanges of LLC Interests by the TRA Owners, the Company continuously monitors changes in its overall tax posture, including changes resulting from new legislation and changes as a result of new jurisdictions in which the Company is subject to tax. The Company has recorded deferred tax assets of $190.4 million since our IPO associated with basis differences in the net assets of Shoals Parent and pursuant to making an election under Section 754 of the Internal Revenue Code of 1986 (the "Internal Revenue Code"), as amended. The aggregate payable pursuant

Revenue by Product

Revenue by Product	9 Months Ended
	Sep. 30, 2022
Revenue from Contract with Customer [Abstract]
Revenue by Product	Revenue by Product Based on Topic 606 provisions, the Company disaggregates its revenue from contracts with customers between system solutions and components. System solutions are contracts under which the Company provides multiple products typically in connection with the design and specification of an entire EBOS system. Components represents sales of individual components. The following table presents the Company’s revenue disaggregated by system solutions and components (in thousands): Three Months Ended Nine Months Ended 2022 2021 2022 2021 System solutions $ 69,486 $ 38,641 $ 173,136 $ 123,252 Components 21,337 21,199 59,153 41,914 Total revenue $ 90,823 $ 59,840 $ 232,289 $ 165,166

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2022
Accounting Policies [Abstract]
Basis of Accounting and Presentation	Basis of Accounting and PresentationThe condensed consolidated financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Principles of Consolidation	Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Reclassifications	Reclassifications Certain prior period amounts have been reclassified to conform to the current period presentation.
Non-controlling Interest	Non-controlling Interest The non-controlling interest on the consolidated statement of operations represents the portion of earnings or loss attributable to the economic interest in the Company's subsidiary, Shoals Parent, held by the Continuing Equity Owners. Non-controlling interest on the condensed consolidated balance sheet represents the portion of net assets of the Company attributable to the Continuing Equity Owners, based on the portion of the LLC Interests owned by such unit holders.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include revenue recognition, allowance for doubtful accounts, useful lives of property, plant and equipment and other intangible assets, impairment of long-lived assets, allowance for slow moving inventory, payable pursuant to the tax receivable agreement (“TRA”) and valuation allowance on deferred tax assets.
Restricted Cash	Restricted CashRestricted cash is included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Restricted cash is restricted as to withdrawal or use.
Recent Accounting Pronouncements	Recent Accounting Pronouncements Adopted On January 1, 2022, the Company adopted Accounting Standards Update (“ASU”) No. 2016-02 (Topic 842) “Leases” which supersedes the lease recognition requirements in Accounting Standards Codification (“ASC”) Topic 840, “Leases” . Under ASU No. 2016-02, lessees are required to recognize assets and liabilities on the consolidated balance sheets for most leases and provide enhanced disclosures. For companies that are not emerging growth companies (“EGCs”), the ASU was effective for fiscal years beginning after December 15, 2018. For EGCs, the ASU is effective for fiscal years beginning after December 15, 2021. The Company adopted the new standard using the modified retrospective method by recording a right-of-use asset of $1.2 million, short-term portion of lease liabilities of $0.4 million and long-term portion of lease liabilities of $0.8 million as of the effective date. Prior periods will not be restated and will continue to be reported under Topic 840 guidance in effect during those periods. The Company applied the package of practical expedients to leases that commenced before the effective date whereby the Company elected to not reassess the following: (i) whether any expired or existing contracts contain leases; (ii) the lease classification for any expired or existing leases; and (iii) initial direct costs for any existing leases. The adoption did not have a material impact on its consolidated statements of operations or its consolidated statements of cash flows. See Note 14 - Leases for further information and disclosures related to the adoption of this standard. Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses , which was subsequently amended by ASU No. 2018-19 and ASU No. 2019-10, and which requires the measurement of expected credit losses for financial instruments carried at amortized cost held at the reporting date based on historical experience, current conditions and reasonable forecasts. The updated guidance also amends the current other-than-temporary impairment model for available-for-sale debt securities by requiring the recognition of impairments relating to credit losses through an allowance account and limits the amount of credit loss to the difference between a security’s amortized cost basis and its fair value. In addition, the length of time a security has been in an unrealized loss position will no longer impact the determination of whether a credit loss exists. The main objective of this ASU is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. For EGC’s, the standard is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2022. The Company will continue to assess the possible impact of this standard, but currently does not expect the adoption of this standard will have a significant impact on its financial statements and its limited history of bad debt expense relating to trade accounts receivable. In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805) Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . This ASU requires that contract assets and contract liabilities acquired in a business combination be recognized and measured in accordance with Topic 606. At the acquisition date, an acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. This guidance is effective for fiscal years beginning after December 15, 2022, including interim periods within that fiscal year. Early adoption of the amendments is permitted, including adoption in an interim period. An entity that early adopts in an interim period should apply the amendments (1) retrospectively to all business combinations for which the acquisition date occurs on or after the beginning of the fiscal year that includes the interim period of early application and (2) prospectively to all business combinations that occur on or after the date of initial application. We are currently evaluating the impact of the new standard on our financial statements and related disclosures. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements.

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2022
Accounting Policies [Abstract]
Schedule of Cash and Cash Equivalents	A reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheet is as follows (in thousands): September 30, December 31, 2021 Cash and cash equivalents $ 11,202 $ 5,006 Restricted cash included in other current asset 3,583 — Restricted cash included in other assets 16,831 4,551 Total cash, cash equivalents and restricted cash $ 31,616 $ 9,557
Schedule of Restricted Cash	A reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheet is as follows (in thousands): September 30, December 31, 2021 Cash and cash equivalents $ 11,202 $ 5,006 Restricted cash included in other current asset 3,583 — Restricted cash included in other assets 16,831 4,551 Total cash, cash equivalents and restricted cash $ 31,616 $ 9,557
Schedule of Revenue and Accounts Receivable Concentration Risks	The Company had the following revenue concentrations representing 10% or more of revenue for the nine months ended September 30, 2022 and 2021 and related accounts receivable concentrations as of September 30, 2022 and December 31, 2021: 2022 2021 Revenue % Accounts Revenue % Accounts Customer A 9.0 % 7.1 % 22.5 % 15.8 % Customer B 6.9 % 3.3 % 11.8 % 4.6 %

Acquisition of ConnectPV (Table

Acquisition of ConnectPV (Tables)	9 Months Ended
	Sep. 30, 2022
Business Combination and Asset Acquisition [Abstract]
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed	The estimated fair value allocated to certain property, plant and equipment, identifiable intangible assets and goodwill was determined based on a combination of market, cost and income approaches with the assistance of a third-party valuation firm (in thousands): Purchase Price Allocation Cash and cash equivalents $ 849 Accounts receivable 5,382 Inventory 4,273 Other current assets 1,583 Total current assets 12,087 Property, plant and equipment 438 Goodwill 19,765 Other intangible assets 1,600 Total Assets 33,890 Accounts payable 9,440 Accrued expenses 2,655 Debt 1,537 Total liabilities 13,632 Net assets acquired $ 20,258
Schedule of Pro Forma Financial Information	The pro forma information below gives effect to the ConnectPV acquisition as if it had been completed on the first day of each period presented. The pro forma results of operations are presented for informational purposes only. As such, they are not necessarily indicative of the Company’s results had the acquisition been completed on the first day of each period presented, nor do they intend to represent the Company’s future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisition and does not reflect additional revenue opportunities following the acquisition. The pro forma information includes adjustments to record the assets and liabilities associated with the acquisition at their respective fair values, based on available information and to give effect to the financing for the acquisition (in thousands): Nine Months Ended Revenue $ 181,663 Net income $ 4,226

Accounts Receivable (Tables)

Accounts Receivable (Tables)	9 Months Ended
	Sep. 30, 2022
Receivables [Abstract]
Schedule of Accounts Receivable	Accounts receivable consists of the following (in thousands): September 30, December 31, 2021 Accounts receivable $ 71,938 $ 32,015 Less: allowance for doubtful accounts (286) (516) Accounts receivable, net $ 71,652 $ 31,499

Inventory (Tables)

Inventory (Tables)	9 Months Ended
	Sep. 30, 2022
Inventory Disclosure [Abstract]
Schedule of Inventory	Inventory consists of the following (in thousands): September 30, December 31, 2021 Raw materials $ 82,451 $ 39,265 Allowance for obsolete or slow-moving inventory (1,293) (897) Inventory, net $ 81,158 $ 38,368

Property, Plant and Equipment (

Property, Plant and Equipment (Tables)	9 Months Ended
	Sep. 30, 2022
Property, Plant and Equipment [Abstract]
Schedule of Property, Plant, and Equipment, Net	Property, plant, and equipment, net consists of the following (in thousands): Estimated Useful Lives (Years) September 30, December 31, 2021 Land N/A $ 840 $ 840 Building and land improvements 5-40 8,833 7,801 Machinery and equipment 3-5 11,970 10,693 Furniture and fixtures 3-7 1,797 1,775 Vehicles 5 127 65 23,567 21,174 Less: accumulated depreciation (6,971) (5,600) Property, plant and equipment, net $ 16,596 $ 15,574

Goodwill and Other Intangible_2

Goodwill and Other Intangible Assets (Tables)	9 Months Ended
	Sep. 30, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of Carrying Amount of Goodwill	Changes in the carrying amount of goodwill during the nine months ended September 30, 2022 are shown below (in thousands): Goodwill Beginning Balance $ 69,436 Adjustments related to finalization of working capital in the acquisition of ConnectPV 505 Ending Balance $ 69,941
Schedule of Other Intangible Assets	Other intangible assets consists of the following (in thousands): Estimated Useful Lives (Years) September 30, December 31, 2021 Amortizable: Costs: Customer relationships 13 $ 53,100 $ 53,100 Developed technology 13 34,600 34,600 Trade names 13 11,900 11,900 Backlog 1 600 600 Noncompete agreements 5 2,000 2,000 Total amortizable intangibles 102,200 102,200 Accumulated amortization: Customer relationships 21,851 18,629 Developed technology 14,195 12,199 Trade names 4,948 4,103 Backlog 600 200 Noncompete agreements 2,000 1,833 Total accumulated amortization 43,594 36,964 Total amortizable intangibles, net $ 58,606 $ 65,236

Accrued Expenses and Other (Tab

Accrued Expenses and Other (Tables)	9 Months Ended
	Sep. 30, 2022
Payables and Accruals [Abstract]
Schedule of Accrued Expenses and Other Consists	Accrued expenses and other consists of the following (in thousands): September 30, December 31, 2021 Accrued compensation $ 3,838 $ 2,882 Deferred revenue 28,720 1,841 September 30, December 31, 2021 Accrued interest 6,276 3,095 Accrued professional fees 595 548 Lease liability 1,139 — Other accrued expenses 2,839 1,203 Total accrued expenses and other $ 43,407 $ 9,569

Long-Term Debt (Tables)

Long-Term Debt (Tables)	9 Months Ended
	Sep. 30, 2022
Debt Disclosure [Abstract]
Schedule of Long-term Debt	Long-term debt consists of the following (in thousands): September 30, December 31, 2021 Term Loan Facility $ 195,750 $ 197,250 Revolving Credit Facility 85,640 55,140 Less: deferred financing costs (4,461) (5,337) Total debt, net of deferred financing costs 276,929 247,053 Less: current portion (2,000) (2,000) Long-term debt, less current portion $ 274,929 $ 245,053

Earnings per Share ("EPS") (Tab

Earnings per Share ("EPS") (Tables)	9 Months Ended
	Sep. 30, 2022
Earnings Per Share [Abstract]
Schedule of Basic and Diluted Earnings Per Share	Basic and diluted EPS of Class A Common Stock have been computed as follows (in thousands, except per share amounts): Three Months Ended Nine Months Ended Period from January 27, 2021 2022 2021 Numerator: Net income attributable to Shoals Technologies Group, Inc. - basic $ 7,958 $ 2,486 $ 15,000 $ 1,510 Reallocation of net income attributable to non-controlling interests from the assumed conversion of Class B common stock — — — — Net income attributable to Shoals Technologies Group, Inc. - diluted $ 7,958 $ 2,486 $ 15,000 $ 1,510 Denominator: Weighted average shares of Class A common stock outstanding - basic 112,975 101,890 112,561 96,354 Three Months Ended Nine Months Ended Period from January 27, 2021 2022 2021 Effect of dilutive securities: Restricted / Performance Stock Units 609 361 255 173 Class B Common Stock — — — — Weighted average shares of Class A common stock outstanding - diluted 113,584 102,251 112,816 96,527 Earnings (loss) per share of Class A common stock - basic $ 0.07 $ 0.02 $ 0.13 $ 0.02 Earnings (loss) per share of Class A common stock - diluted $ 0.07 $ 0.02 $ 0.13 $ 0.02

Equity-Based Compensation (Tabl

Equity-Based Compensation (Tables)	9 Months Ended
	Sep. 30, 2022
Share-Based Payment Arrangement [Abstract]
Schedule of RSU And PSU Activity	Activity under the 2021 Incentive Plan for RSUs was as follows: Restricted Weighted Average Price Outstanding, December 31, 2021 1,632,844 $ 27.58 Granted 665,179 $ 13.06 Vested (559,336) $ 26.05 Forfeited (56,461) $ 26.10 Outstanding, September 30, 2022 1,682,226 $ 22.38 Activity under the 2021 Incentive Plan for PSUs was as follows: Performance Weighted Average Price Outstanding, December 31, 2021 — $ — Granted 242,907 $ 11.41 Vested — $ — Forfeited — $ — Outstanding, September 30, 2022 242,907 $ 11.41

Non-Controlling Interests (Tabl

Non-Controlling Interests (Tables)	9 Months Ended
	Sep. 30, 2022
Noncontrolling Interest [Abstract]
Schedule of Effects of Changes in Ownership	The following table summarizes the effects of the changes in ownership in Shoals Parent on equity: Nine Months Ended Period from January 27, 2021 Net income attributable to non-controlling interest $ 9,711 $ 1,911 Transfers to non-controlling interests Decrease as a result of the Organizational Transactions — (88,644) Increase as a result of newly issued LLC Interests in IPO — 70,976 Increase as a result of activity under equity-based compensation plan 4,257 2,607 Decrease from tax distributions to non-controlling interest (7,762) (4,837) Reallocation of non-controlling interest 107 6,005 Change from net income attributable to/from non-controlling interest and transfers to non-controlling interest $ 6,313 $ (11,982)

Leases (Tables)

Leases (Tables)	9 Months Ended
	Sep. 30, 2022
Leases [Abstract]
Schedule of Lease Assets and Liabilities	The following table summarizes the balances as it relates to leases at the end of the period (in thousands): (*) September 30, ROU asset Other assets $ 4,358 Lease liability, current portion Accrued expenses and other $ 1,139 Lease liability, long-term portion Other long-term liabilities 3,553 Total lease liability $ 4,692 (*) Location on the condensed consolidated balance sheet
Schedule of Lease Expense	The details of the Company’s operating leases are as follows (in thousands): Three Months Ended Nine Months Ended Operating lease expense $ 297 $ 829 Variable lease expense 51 176 Short-term lease expense — 91 Total lease expense $ 348 $ 1,096 The Company’s weighted-average remaining lease-term and weighted-average discount rate are as follows (in thousands): Nine Months Ended Weighted average remaining lease-term 4.1 years Weighted average discount rate 4.5 % Supplemental cash flow and other information related to operating leases are as follows: Nine Months Ended Operating cash flows from operating leases $ 918 Non cash investing activities: Lease liabilities arising from obtaining right-of-use assets as of January 1, 2022 $ 1,239 Lease liabilities arising from obtaining right-of-use assets during the nine months ended September 30, 2022 $ 3,990
Schedule of Operating Lease Maturity	The following table presents the maturities of lease liabilities (in thousands): Fiscal year ending December 31, Operating Leases 2022 $ 326 2023 1,339 2024 1,264 2025 960 2026 952 Thereafter 246 Total lease payments 5,087 Less: Imputed lease interest (395) Total lease liabilities $ 4,692
Schedule of Future Minimum Rental Payments for Operating Leases	The following table represents future minimum lease obligations under non-cancelable operating leases (in thousands): Fiscal year ending December 31, Operating Leases 2022 $ 489 2023 499 2024 200 2025 58 2026 6 Total $ 1,252

Payable Pursuant to the Tax R_2

Payable Pursuant to the Tax Receivable Agreement (Tables)	9 Months Ended
	Sep. 30, 2022
Tax Receivable Agreement [Abstract]
Schedule of Tax Receivable Agreement	The following table reflects the changes to the Company's payable pursuant to the tax receivable agreement (in thousands): Nine Months Ended 2022 2021 Beginning balance $ 156,374 $ — Additions to TRA: Exchange of LLC Interests for Class A Common Stock 4,629 92,376 Merger of Shoals investment CTB — 13,490 Adjustment for change in estimated effective income tax rate — 2,014 Payments under TRA — — Payable pursuant to TRA 161,003 107,880 Less: current portion (3,583) — Payable pursuant to TRA, less current portion $ 157,420 $ 107,880

Revenue by Product (Tables)

Revenue by Product (Tables)	9 Months Ended
	Sep. 30, 2022
Revenue from Contract with Customer [Abstract]
Schedule of Revenue Disaggregated by Product	The following table presents the Company’s revenue disaggregated by system solutions and components (in thousands): Three Months Ended Nine Months Ended 2022 2021 2022 2021 System solutions $ 69,486 $ 38,641 $ 173,136 $ 123,252 Components 21,337 21,199 59,153 41,914 Total revenue $ 90,823 $ 59,840 $ 232,289 $ 165,166

Organization and Business (Deta

Organization and Business (Details) $ / shares in Units, $ in Thousands				9 Months Ended
	Jul. 16, 2021 shares	Jan. 29, 2021 USD ($) $ / shares shares	Jan. 26, 2021 shares	Sep. 30, 2022 USD ($) subsidiary shares	Sep. 30, 2021 USD ($)	Aug. 26, 2021
Class of Stock [Line Items]
Number of subsidiaries | subsidiary				5
Underwriting discounts and commission payments | $				$ 0	$ 9,619
Shoals Parent
Class of Stock [Line Items]
Interests purchased in subsidiaries (shares)		6,315,790		480,116
Founder and Class B Unit Holder in Shoals Parent
Class of Stock [Line Items]
Interests purchased in subsidiaries (shares)		5,234,210
Class A Common Stock
Class of Stock [Line Items]
Stock issued for organizational transactions (shares)		81,977,751	81,977,751
Class B Common Stock
Class of Stock [Line Items]
Stock issued in conversion (shares)		78,300,817
Stock issued in conversion per share (shares)		1
IPO
Class of Stock [Line Items]
Consideration received from stock issued in IPO | $		$ 278,800
Underwriting discounts and commission payments | $		$ 9,900
IPO | Class A Common Stock
Class of Stock [Line Items]
Stock issued in IPO (shares)		11,550,000
Price per share of stock issued in IPO (USD per share) | $ / shares		$ 25
Stock Offering By Selling Shareholders | Class A Common Stock
Class of Stock [Line Items]
Stock issued in IPO (shares)	4,989,692
Stock Offering | Class A Common Stock
Class of Stock [Line Items]
Stock issued in IPO (shares)	10,402,086
ConnectPV
Class of Stock [Line Items]
Voting interests acquired (as a percent)						100%

Summary of Significant Accoun_4

Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021	Jan. 01, 2021
Condensed Income Statements, Captions [Line Items]
Restricted cash and cash equivalents	$ 20,400	$ 4,600
ROU asset	4,358
Lease liability, current portion	1,139	$ 0
Lease liability, long-term portion	$ 3,553
Accounting Standards Update 2016-02
Condensed Income Statements, Captions [Line Items]
ROU asset			$ 1,200
Lease liability, current portion			400
Lease liability, long-term portion			$ 800
Shoals Parent
Condensed Income Statements, Captions [Line Items]
Non-controlling ownership interest (as a percent)	32.16%

Summary of Significant Accoun_5

Summary of Significant Accounting Policies - Cash Cash Equivalents And Restricted Cash (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021	Sep. 30, 2021	Dec. 31, 2020
Accounting Policies [Abstract]
Cash and cash equivalents	$ 11,202	$ 5,006
Restricted cash included in other current asset	3,583	0
Restricted cash included in other assets	16,831	4,551
Total cash, cash equivalents and restricted cash	$ 31,616	$ 9,557	$ 14,189	$ 10,073

Summary of Significant Accoun_6

Summary of Significant Accounting Policies - Revenue and Accounts Receivable Concentrations (Details) - Customer Concentration Risk	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Revenue % | Customer A
Concentration Risk [Line Items]
Concentration risk (as a percent)	9%	22.50%
Revenue % | Customer B
Concentration Risk [Line Items]
Concentration risk (as a percent)	6.90%	11.80%
Accounts Receivable % | Customer A
Concentration Risk [Line Items]
Concentration risk (as a percent)	7.10%	15.80%
Accounts Receivable % | Customer B
Concentration Risk [Line Items]
Concentration risk (as a percent)	3.30%	4.60%

Acquisition of ConnectPV - Narr

Acquisition of ConnectPV - Narrative (Details) - USD ($) $ in Thousands		9 Months Ended
	Aug. 26, 2021	Sep. 30, 2022	Sep. 30, 2021
Business Acquisition, Equity Interests Issued or Issuable [Line Items]
Aggregate purchase price, net of cash acquired		$ 0	$ 12,909
ConnectPV
Business Acquisition, Equity Interests Issued or Issuable [Line Items]
Voting interests acquired (as a percent)	100%
Aggregate purchase price, net of cash acquired	$ 13,800
Cash acquired from acquisition	$ 800
Equity interest issued or issuable (shares)	209,437
Value of equity interest issued or issuable	$ 6,500
Adjustments related to finalization of working capital in the acquisition of ConnectPV	$ 19,800

Acquisition of ConnectPV - Purc

Acquisition of ConnectPV - Purchase Price Allocation (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021	Aug. 26, 2021
Business Acquisition [Line Items]
Goodwill	$ 69,941	$ 69,436
ConnectPV
Business Acquisition [Line Items]
Cash and cash equivalents			$ 849
Accounts receivable			5,382
Inventory			4,273
Other current assets			1,583
Total current assets			12,087
Property, plant and equipment			438
Goodwill			19,765
Other intangible assets			1,600
Total Assets			33,890
Accounts payable			9,440
Accrued expenses			2,655
Debt			1,537
Total liabilities			13,632
Net assets acquired			$ 20,258

Acquisition of ConnectPV - Pro

Acquisition of ConnectPV - Pro Forma Financial Information (Details) - ConnectPV $ in Thousands	9 Months Ended
	Sep. 30, 2021 USD ($)
Business Acquisition [Line Items]
Revenue	$ 181,663
Net income	$ 4,226

Accounts Receivable (Details)

Accounts Receivable (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Receivables [Abstract]
Accounts receivable	$ 71,938	$ 32,015
Less: allowance for doubtful accounts	(286)	(516)
Accounts receivable, net	$ 71,652	$ 31,499

Inventory (Details)

Inventory (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Inventory Disclosure [Abstract]
Raw materials	$ 82,451	$ 39,265
Allowance for obsolete or slow-moving inventory	(1,293)	(897)
Inventory, net	$ 81,158	$ 38,368

Property, Plant and Equipment -

Property, Plant and Equipment - Summary (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 23,567	$ 21,174
Less: accumulated depreciation	(6,971)	(5,600)
Property, plant and equipment, net	16,596	15,574
Land
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	840	840
Building and land improvements
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 8,833	7,801
Building and land improvements | Minimum
Property, Plant and Equipment [Line Items]
Estimated Useful Lives (Years)	5 years
Building and land improvements | Maximum
Property, Plant and Equipment [Line Items]
Estimated Useful Lives (Years)	40 years
Machinery and equipment
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 11,970	10,693
Machinery and equipment | Minimum
Property, Plant and Equipment [Line Items]
Estimated Useful Lives (Years)	3 years
Machinery and equipment | Maximum
Property, Plant and Equipment [Line Items]
Estimated Useful Lives (Years)	5 years
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 1,797	1,775
Furniture and fixtures | Minimum
Property, Plant and Equipment [Line Items]
Estimated Useful Lives (Years)	3 years
Furniture and fixtures | Maximum
Property, Plant and Equipment [Line Items]
Estimated Useful Lives (Years)	7 years
Vehicles
Property, Plant and Equipment [Line Items]
Estimated Useful Lives (Years)	5 years
Property, plant and equipment, gross	$ 127	$ 65

Property, Plant and Equipment_2

Property, Plant and Equipment - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 0.5	$ 0.5	$ 1.4	$ 1.3
Depreciation expense allocated to cost of revenue	0.4	0.4	1.1	1
Depreciation expense allocated to operating expenses	$ 0.1	$ 0.1	$ 0.3	$ 0.3

Goodwill and Other Intangible_3

Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill	$ 69,941		$ 69,941		$ 69,436
Amortization expense of intangible assets	$ 2,100	$ 2,100	$ 6,600	$ 6,100

Goodwill and Other Intangible_4

Goodwill and Other Intangible Assets - Carrying Amount of Goodwill (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2022 USD ($)
Goodwill [Roll Forward]
Goodwill, beginning balance	$ 69,436
Adjustments related to finalization of working capital in the acquisition of ConnectPV	505
Goodwill, ending balance	$ 69,941

Goodwill and Other Intangible_5

Goodwill and Other Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Finite-Lived Intangible Assets [Line Items]
Total amortizable intangibles	$ 102,200	$ 102,200
Total accumulated amortization	43,594	36,964
Total amortizable intangibles, net	$ 58,606	65,236
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Lives (Years)	13 years
Total amortizable intangibles	$ 53,100	53,100
Total accumulated amortization	$ 21,851	18,629
Developed technology
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Lives (Years)	13 years
Total amortizable intangibles	$ 34,600	34,600
Total accumulated amortization	$ 14,195	12,199
Trade names
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Lives (Years)	13 years
Total amortizable intangibles	$ 11,900	11,900
Total accumulated amortization	$ 4,948	4,103
Backlog
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Lives (Years)	1 year
Total amortizable intangibles	$ 600	600
Total accumulated amortization	$ 600	200
Noncompete agreements
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Lives (Years)	5 years
Total amortizable intangibles	$ 2,000	2,000
Total accumulated amortization	$ 2,000	$ 1,833

Accrued Expenses and Other (Det

Accrued Expenses and Other (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Payables and Accruals [Abstract]
Accrued compensation	$ 3,838	$ 2,882
Deferred revenue	28,720	1,841
Accrued interest	6,276	3,095
Accrued professional fees	595	548
Lease liability	1,139	0
Other accrued expenses	2,839	1,203
Accrued expenses and other	$ 43,407	$ 9,569

Long-Term Debt - Summary (Detai

Long-Term Debt - Summary (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Debt Instrument [Line Items]
Less: deferred financing costs	$ (4,461)	$ (5,337)
Total debt, net of deferred financing costs	276,929	247,053
Less: current portion	(2,000)	(2,000)
Long-term debt, less current portion	274,929	245,053
Senior Secured Credit Agreement | Line of Credit | Secured Debt
Debt Instrument [Line Items]
Long-term debt, gross	195,750	197,250
Senior Secured Credit Agreement | Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Long-term debt, gross	$ 85,640	$ 55,140

Long-Term Debt - Narrative (Det

Long-Term Debt - Narrative (Details)			1 Months Ended	3 Months Ended		9 Months Ended
	Jan. 29, 2021 USD ($)	Nov. 25, 2020 USD ($)	Dec. 31, 2020 USD ($) amendment	Sep. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)	May 02, 2022 USD ($)	May 01, 2022 USD ($)
Debt Instrument [Line Items]
Loss on debt repayment				$ 0	$ 0	$ 0	$ 15,990,000
Revolving Credit Facility
Debt Instrument [Line Items]
Payments on term loan facility						$ 15,500,000	$ 0
Senior Secured Credit Agreement | Line of Credit
Debt Instrument [Line Items]
Number of amendments to debt agreement | amendment			2
Senior Secured Credit Agreement | Line of Credit | Secured Debt
Debt Instrument [Line Items]
Face amount of debt instrument		$ 350,000,000
Term of debt instrument		6 years
Payments on term loan facility	$ 150,000,000
Loss on debt repayment	16,000,000
Prepayment premium	11,300,000
Write-off of deferred financing costs	$ 4,700,000
Effective interest rate of debt instrument (as a percent)				5.94%		5.94%
Senior Secured Credit Agreement | Line of Credit | Secured Debt | SOFR
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)						3.25%
Senior Secured Credit Agreement | Line of Credit | Delayed Draw Secured Debt
Debt Instrument [Line Items]
Term of debt instrument		6 years
Maximum borrowing capacity of credit facility		$ 30,000,000
Senior Secured Credit Agreement | Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Maximum borrowing capacity of credit facility								$ 150,000,000	$ 100,000,000
Increase in maximum borrowing capacity of credit facility			$ 100,000,000
Maximum net leverage ratio								6.50
Remaining borrowing capacity under credit facility				$ 64,400,000		$ 64,400,000
Senior Secured Credit Agreement | Line of Credit | Revolving Credit Facility | SOFR
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)						3.25%
Senior Secured Credit Agreement | Line of Credit | Revolving Credit Facility | Maximum
Debt Instrument [Line Items]
Effective interest rate of debt instrument (as a percent)				6.89%		6.89%
Senior Secured Credit Agreement | Line of Credit | Revolving Credit Facility | Minimum
Debt Instrument [Line Items]
Effective interest rate of debt instrument (as a percent)				5.41%		5.41%

Earnings per Share ("EPS") (Det

Earnings per Share ("EPS") (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		8 Months Ended	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2021	Sep. 30, 2022
Numerator:
Net income attributable to Shoals Technologies Group, Inc. - basic	$ 7,958	$ 2,486	$ 1,510	$ 15,000
Reallocation of net income attributable to non-controlling interests from the assumed conversion of Class B common stock	0	0	0	0
Net income attributable to Shoals Technologies Group, Inc. - diluted	$ 7,958	$ 2,486	$ 1,510	$ 15,000
Denominator:
Weighted average shares of Class A common stock outstanding - basic (shares)	112,975	101,890	96,354	112,561
Weighted average shares of Class A common stock outstanding - diluted (shares)	113,584	102,251	96,527	112,816
Earnings (loss) per share of Class A common stock - basic (USD per share)	$ 0.07	$ 0.02	$ 0.02	$ 0.13
Earnings (loss) per share of Class A common stock - diluted (USD per share)	$ 0.07	$ 0.02	$ 0.02	$ 0.13
Restricted / Performance Stock Units
Denominator:
Effect of dilutive securities (shares)	609	361	173	255
Class B Common Stock
Denominator:
Effect of dilutive securities (shares)	0	0	0	0

Equity-Based Compensation - Nar

Equity-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021	Jan. 26, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity-based compensation	$ 4	$ 2.7	$ 11.9	$ 6.9
Unrecognized compensation costs	$ 34.6		$ 34.6
Period for recognition of unrecognized compensation costs			2 years 3 months 18 days
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock units granted (shares)			665,179
Award vesting period					3 years
Restricted Stock Units | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share price (USD per share)						$ 10.42
Restricted Stock Units | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share price (USD per share)						$ 25.05
Performance Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock units granted (shares)			242,907
Award vesting period			3 years
Performance Stock Units | Minimum | Class A Common Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share price (USD per share)	$ 10.42		$ 10.42
Performance Stock Units | Maximum | Class A Common Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share price (USD per share)	$ 12.60		$ 12.60
2021 Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized (shares)						8,768,124

Equity-Based Compensation - Res

Equity-Based Compensation - Restricted And Performance Stock Unit Activity (Details)	9 Months Ended
	Sep. 30, 2022 $ / shares shares
Restricted Stock Units
Restricted Stock Units
Outstanding at beginning of period (shares) | shares	1,632,844
Granted (shares) | shares	665,179
Vested (shares) | shares	(559,336)
Forfeited (shares) | shares	(56,461)
Outstanding at end of period (shares) | shares	1,682,226
Weighted Average Price
Balance at beginning of period (USD per share) | $ / shares	$ 27.58
Granted (USD per share) | $ / shares	13.06
Vested (USD per share) | $ / shares	26.05
Forfeited (USD per share) | $ / shares	26.10
Balance at end of period (USD per share) | $ / shares	$ 22.38
Performance Stock Units
Restricted Stock Units
Outstanding at beginning of period (shares) | shares	0
Granted (shares) | shares	242,907
Vested (shares) | shares	0
Forfeited (shares) | shares	0
Outstanding at end of period (shares) | shares	242,907
Weighted Average Price
Balance at beginning of period (USD per share) | $ / shares	$ 0
Granted (USD per share) | $ / shares	11.41
Vested (USD per share) | $ / shares	0
Forfeited (USD per share) | $ / shares	0
Balance at end of period (USD per share) | $ / shares	$ 11.41

Stockholders' Equity (Deficit)

Stockholders' Equity (Deficit) (Details) $ / shares in Units, $ in Millions	Jan. 29, 2021 USD ($) $ / shares shares	Jan. 26, 2021 class vote $ / shares shares	Sep. 30, 2022 $ / shares shares	Dec. 31, 2021 $ / shares shares
Class of Stock [Line Items]
Preferred stock authorized (shares)		5,000,000	5,000,000	5,000,000
Number of classes of directors | class		3
Maximum ratio of class B common stock held to LLC interests held		1
Ratio for cancellation of class B common stock when LLC interests are redeemed or exchanged		1
Required ratio of class A common stock issued to LLC interests owned		1
Required ratio of class B common stock owned by Continuing Equity Owners to number of LLC interests owned by Continuing Equity Owners		1
Shoals Parent
Class of Stock [Line Items]
Interests purchased in subsidiaries (shares)	6,315,790		480,116
Founder and Class B Unit Holder in Shoals Parent
Class of Stock [Line Items]
Interests purchased in subsidiaries (shares)	5,234,210
IPO
Class of Stock [Line Items]
Consideration received from stock issued in IPO | $	$ 278.8
Class A Common Stock
Class of Stock [Line Items]
Common stock authorized (shares)		1,000,000,000	1,000,000,000	1,000,000,000
Common stock, par value (USD per share) | $ / shares		$ 0.00001	$ 0.00001	$ 0.00001
Number of votes per share of common stock | vote		1
Stock issued for organizational transactions (shares)	81,977,751	81,977,751
Class A Common Stock | IPO
Class of Stock [Line Items]
Stock issued in IPO (shares)	11,550,000
Price per share of stock issued in IPO (USD per share) | $ / shares	$ 25
Class B Common Stock
Class of Stock [Line Items]
Common stock authorized (shares)		195,000,000	195,000,000	195,000,000
Common stock, par value (USD per share) | $ / shares		$ 0.00001	$ 0.00001	$ 0.00001
Number of votes per share of common stock | vote		1

Non-Controlling Interests - Nar

Non-Controlling Interests - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended					9 Months Ended
	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2021	Jun. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Jan. 29, 2021
Noncontrolling Interest [Line Items]
Distributions to non-controlling interest	$ 3,196	$ 1,628	$ 2,938	$ 1,864	$ 2,973	$ 7,800	$ 4,800
Shoals Parent
Noncontrolling Interest [Line Items]
Interests purchased in subsidiaries (shares)	480,116					480,116		6,315,790
Shoals Parent
Noncontrolling Interest [Line Items]
Ownership interest (as a percent)	67.84%					67.84%

Non-Controlling Interests - Eff

Non-Controlling Interests - Effects of Changes in Ownership (Details) - USD ($) $ in Thousands	3 Months Ended		8 Months Ended	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Noncontrolling Interest [Abstract]
Net income attributable to non-controlling interest	$ 4,801	$ 2,790	$ 1,911	$ 9,711	$ 1,911
Decrease as a result of the Organizational Transactions			(88,644)	0
Increase as a result of newly issued LLC Interests in IPO			70,976	0
Increase as a result of activity under equity-based compensation plan			2,607	4,257
Decrease from tax distributions to non-controlling interest			(4,837)	(7,762)
Reallocation of non-controlling interest			6,005	107
Change from net income attributable to/from non-controlling interest and transfers to non-controlling interest			$ (11,982)	$ 6,313

Leases - Narrative (Details)

Leases - Narrative (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Jan. 01, 2021
Lessee, Lease, Description [Line Items]
Operating lease, right-of-use asset	$ 4,358
Operating lease liabilities	$ 4,692
Accounting Standards Update 2016-02
Lessee, Lease, Description [Line Items]
Operating lease, right-of-use asset		$ 1,200
Operating lease liabilities		$ 1,200

Leases - Assets and Liabilities

Leases - Assets and Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Leases [Abstract]
ROU asset	$ 4,358
Lease liability, current portion	1,139	$ 0
Lease liability, long-term portion	3,553
Total lease liability	$ 4,692
Operating lease, right-of-use asset, statement of financial position	Other current assets
Operating lease, liability, current, statement of financial position	Accrued expenses and other
Operating lease, liability, noncurrent, statement of financial position	Other long-term liabilities

Leases - Lease Expenses (Detail

Leases - Lease Expenses (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2022
Leases [Abstract]
Operating lease expense	$ 297	$ 829
Variable lease expense	51	176
Short-term lease expense	0	91
Total lease expense	$ 348	$ 1,096

Leases - Maturities of Lease Li

Leases - Maturities of Lease Liabilities (Details) $ in Thousands	Sep. 30, 2022 USD ($)
Leases [Abstract]
2022	$ 326
2023	1,339
2024	1,264
2025	960
2026	952
Thereafter	246
Total lease payments	5,087
Less: Imputed lease interest	(395)
Total lease liabilities	$ 4,692

Leases - Future Minimum Lease O

Leases - Future Minimum Lease Obligation (Details) $ in Thousands	Sep. 30, 2022 USD ($)
Leases [Abstract]
2022	$ 489
2023	499
2024	200
2025	58
2026	6
Total	$ 1,252

Leases - Weighted-Average Remai

Leases - Weighted-Average Remaining Lease-Term and Discount Rate (Details)	Sep. 30, 2022
Leases [Abstract]
Weighted average remaining lease-term	4 years 1 month 6 days
Weighted average discount rate	4.50%

Leases - Supplemental Cash Flow

Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands		9 Months Ended
	Jan. 01, 2022	Sep. 30, 2022
Leases [Abstract]
Operating cash flows from operating leases		$ 918
Non cash investing activities:
Lease liabilities arising from obtaining right-of-use assets during 2022	$ 1,239	$ 3,990

Commitments and Contingencies (

Commitments and Contingencies (Details) - USD ($)	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Loss Contingencies [Line Items]
Employer discretionary contributions	$ 0
Employer matching contributions	300,000	$ 100,000
Surety Bond
Loss Contingencies [Line Items]
Maximum potential payment obligation with regard to surety bonds	$ 16,000,000

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Income Tax Disclosure [Abstract]
Effective income tax rate (as a percent)	(18.20%)	105%
Gross unrecognized tax benefits	$ 1

Payable Pursuant to the Tax R_3

Payable Pursuant to the Tax Receivable Agreement - Narrative (Details) - USD ($) $ in Millions	Sep. 30, 2022	Jan. 29, 2021
Tax Receivable Agreement [Abstract]
Tax receivable agreement, proportion of tax benefits to be paid to TRA Owners (as a percent)	85%	85%
Deferred tax asset related to the tax receivable agreement	$ 190.4

Payable Pursuant to the Tax R_4

Payable Pursuant to the Tax Receivable Agreement - Summary (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Liability on Tax Receivable Agreement [Roll Forward]
Beginning balance	$ 156,374	$ 0
Exchange of LLC Interests for Class A Common Stock	4,629	92,376
Merger of Shoals investment CTB	0	13,490
Adjustment for change in estimated effective income tax rate	0	2,014
Payments under TRA	0	0
Ending balance	161,003	107,880
Less: current portion	(3,583)	0
Payable pursuant to TRA, less current portion	$ 157,420	$ 107,880

Revenue by Product (Details)

Revenue by Product (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue [Line Items]
Total revenue	$ 90,823	$ 59,840	$ 232,289	$ 165,166
System solutions
Disaggregation of Revenue [Line Items]
Total revenue	69,486	38,641	173,136	123,252
Components
Disaggregation of Revenue [Line Items]
Total revenue	$ 21,337	$ 21,199	$ 59,153	$ 41,914

Uncategorized Items - shls-2022

Label	Element	Value
Noncontrolling Interest [Member]
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	us-gaap_ProfitLoss	$ (5,475,000)
Retained Earnings [Member]
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	us-gaap_ProfitLoss	(5,534,000)
Member Units [Member]
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	us-gaap_ProfitLoss	$ 2,675,000