Cover Page
Cover Page - shares | 3 Months Ended | |
Jun. 30, 2023 | Jul. 24, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-41617 | |
Entity Registrant Name | Nextracker Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 36-5047383 | |
Entity Address, Address Line One | 6200 Paseo Padre Parkway | |
Entity Address, City or Town | Fremont | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94555 | |
City Area Code | 510 | |
Local Phone Number | 270-2500 | |
Title of 12(b) Security | Class A Common Stock, $0.0001 par value | |
Trading Symbol | NXT | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 61,985,696 | |
Entity Central Index Key | 0001852131 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --03-31 |
Unaudited condensed consolidate
Unaudited condensed consolidated balance sheets - USD ($) $ in Thousands | Jun. 30, 2023 | Mar. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 355,081 | $ 130,008 |
Accounts receivable, net of allowance of $1,621 and $1,768, respectively | 222,750 | 271,159 |
Contract assets | 320,124 | 297,960 |
Inventories | 136,656 | 138,057 |
Other current assets | 82,195 | 35,081 |
Total current assets | 1,116,806 | 872,265 |
Property and equipment, net | 6,914 | 7,255 |
Goodwill | 265,153 | 265,153 |
Other intangible assets, net | 1,258 | 1,321 |
Deferred tax assets and other assets | 266,741 | 273,686 |
Total assets | 1,656,872 | 1,419,680 |
Current liabilities: | ||
Accounts payable | 293,451 | 211,355 |
Accrued expenses | 57,280 | 59,770 |
Deferred revenue | 251,040 | 176,473 |
Total current liabilities | 676,138 | 507,426 |
Long-term debt | 147,289 | 147,147 |
TRA liability and other liabilities | 276,298 | 280,246 |
Total liabilities | 1,099,725 | 934,819 |
Commitments and contingencies (Note 9) | ||
Redeemable non-controlling interest | 3,909,522 | 3,560,628 |
Stockholders' deficit: | ||
Accumulated deficit | (3,352,390) | (3,075,782) |
Additional paid-in-capital | 0 | 0 |
Total stockholders' deficit | (3,352,375) | (3,075,767) |
Total liabilities, redeemable interests, and stockholders' deficit | 1,656,872 | 1,419,680 |
Related Party | ||
Current liabilities: | ||
Other current liabilities | 22,049 | 12,239 |
Nonrelated Party | ||
Current liabilities: | ||
Other current liabilities | 52,318 | 47,589 |
Common Class A | ||
Stockholders' deficit: | ||
Common stock, $0.01 par value per share, 100 shares authorized, 100 issued and outstanding | 5 | 5 |
Common Class B | ||
Stockholders' deficit: | ||
Common stock, $0.01 par value per share, 100 shares authorized, 100 issued and outstanding | $ 10 | $ 10 |
Condensed Combined Balance Shee
Condensed Combined Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2023 | Mar. 31, 2023 |
Allowances for doubtful accounts | $ 1,621 | $ 1,768 |
Common Class A | ||
Common stock, par or stated value per share (in USD per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 900,000,000 | 900,000,000 |
Common stock, shares, issued (in shares) | 46,422,308 | 45,886,065 |
Common stock, shares, outstanding (in shares) | 46,422,308 | 45,886,065 |
Common Class B | ||
Common stock, par or stated value per share (in USD per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares, issued (in shares) | 98,204,522 | 98,204,522 |
Common stock, shares, outstanding (in shares) | 98,204,522 | 98,204,522 |
Unaudited condensed consolida_2
Unaudited condensed consolidated statements of operations and comprehensive income - USD ($) $ in Thousands | 3 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | ||
Income Statement [Abstract] | |||
Revenue | $ 479,543 | $ 403,230 | |
Cost of sales | 365,799 | 353,367 | |
Gross profit | 113,744 | 49,863 | |
Selling, general and administrative expenses | 34,235 | 16,117 | |
Research and development | 5,629 | 3,977 | |
Operating income | 73,880 | 29,769 | |
Interest and other (income) expense, net | 1,134 | (61) | |
Income before income taxes | 72,746 | 29,830 | |
Provision for income taxes | 9,101 | 5,700 | |
Net income and comprehensive income | 63,645 | 24,130 | |
Less: Net income attributable to Nextracker LLC prior to the reorganization transactions | 0 | 24,130 | |
Less: Net income attributable to redeemable non-controlling interests | 43,216 | 0 | |
Net income attributable to Nextracker Inc. | $ 20,429 | $ 0 | |
Earnings per share attributable to the stockholders of Nextracker Inc. | |||
Basic (in USD per share) | [1] | $ 0.44 | |
Diluted (in USD per share) | [1] | $ 0.43 | |
Weighted-average shares used in computing per share amounts: | |||
Basic (in shares) | [1] | 46,411,859 | |
Diluted (in shares) | [1] | 146,868,852 | |
[1] (1) Basic and diluted earnings per share is applicable only for the period following the initial public offering (“IPO”) and the related Transactions. See Note 5 for a description of the Transactions. |
Unaudited condensed consolida_3
Unaudited condensed consolidated statements of redeemable interest and stockholders' deficit / parent company equity (deficit) - USD ($) $ in Thousands | Total | Redeemable Preferred Stock | Redeemable units Redeemable Preferred Stock | Redeemable units Redeemable Non-controlling Interest | Accumulated net parent investment | Common stock Common Class A | Common stock Common Class B | Additional paid-in-capital | Accumulated deficit |
Redeemable Beginning Balance at Mar. 31, 2022 | $ 504,168 | $ 0 | |||||||
Beginning Balance at Mar. 31, 2022 | $ 0 | $ (3,035) | $ 0 | $ 0 | $ 0 | $ 0 | |||
Beginning Balance (in shares) at Mar. 31, 2022 | 0 | 0 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 0 | ||||||||
Net income and comprehensive income | 24,130 | 24,130 | |||||||
Stock-based compensation expense and other | 1,005 | ||||||||
Paid-in-kind dividend for Series A redeemable preferred units | $ 6,250 | ||||||||
Paid-in-kind dividend for Series A redeemable preferred units | (6,250) | ||||||||
Net transfer to Parent | 851 | ||||||||
Redeemable Ending Balance at Jul. 01, 2022 | 510,418 | 0 | |||||||
Ending Balance at Jul. 01, 2022 | 0 | 16,701 | $ 0 | $ 0 | 0 | 0 | |||
Ending Balance (in shares) at Jul. 01, 2022 | 0 | 0 | |||||||
Redeemable Beginning Balance at Mar. 31, 2023 | 0 | 3,560,628 | |||||||
Beginning Balance at Mar. 31, 2023 | (3,075,767) | 0 | $ 5 | $ 10 | 0 | (3,075,782) | |||
Beginning Balance (in shares) at Mar. 31, 2023 | 45,886,065 | 98,204,522 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 20,429 | 43,216 | 20,429 | ||||||
Net income and comprehensive income | 63,645 | ||||||||
Stock-based compensation expense and other | $ 8,641 | 8,641 | |||||||
Vesting of Nextracker Inc. RSU awards (in shares) | 0 | 536,243 | |||||||
Redemption value adjustment | $ 305,678 | 305,678 | |||||||
Redemption value adjustment | (305,678) | (8,641) | (297,037) | ||||||
Redeemable Ending Balance at Jun. 30, 2023 | $ 0 | $ 3,909,522 | |||||||
Ending Balance at Jun. 30, 2023 | $ (3,352,375) | $ 0 | $ 5 | $ 10 | $ 0 | $ (3,352,390) | |||
Ending Balance (in shares) at Jun. 30, 2023 | 46,422,308 | 98,204,522 |
Unaudited condensed consolida_4
Unaudited condensed consolidated statements of cash flows - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Cash flows from operating activities: | ||
Net income and comprehensive income | $ 63,645 | $ 24,130 |
Depreciation and amortization | 1,046 | 1,269 |
Changes in working capital and other, net | 161,076 | (22,605) |
Net cash provided by operating activities | 225,767 | 2,794 |
Cash flows from investing activities: | ||
Purchases of property and equipment | (694) | (427) |
Net cash used in investing activities | (694) | (427) |
Cash flows from financing activities: | ||
Net transfers (to) from Parent | 0 | (309) |
Net cash used in financing activities | 0 | (309) |
Effect of exchange rate on cash and cash equivalents | 0 | 0 |
Net increase in cash | 225,073 | 2,058 |
Cash and cash equivalent beginning of period | 130,008 | 29,070 |
Cash and cash equivalent end of period | 355,081 | 31,128 |
Non-cash investing activity: | ||
Unpaid purchases of property and equipment | 155 | 116 |
Non-cash financing activity: | ||
Capitalized offering costs | $ 0 | $ 297 |
Organization of Nextracker
Organization of Nextracker | 3 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization of Nextracker | Organization of Nextracker Nextracker Inc. and its subsidiaries (“Nextracker”, “we”, the “Company”) is a leading provider of intelligent, integrated solar tracker and software solutions used in utility-scale and distributed generation solar projects around the world. Nextracker’s products enable solar panels in utility-scale power plants to follow the sun’s movement across the sky and optimize plant performance. Nextracker has operations in the United States, Mexico, Spain and other countries in Europe, India, Australia, the Middle East, Africa and Brazil. Prior to the completion of the Transactions, as described in Note 5 and the Initial Public Offering as described below, we operated as part of Flex Ltd. (“Flex” or “Parent”) and not as a standalone entity. On December 19, 2022, Nextracker Inc. was formed as a Delaware corporation which is a 100%-owned subsidiary of Yuma, Inc., a Delaware corporation and indirect wholly-owned subsidiary of Flex Ltd. Nextracker Inc. was formed for the purpose of completing the initial public offering of its Class A common stock (the “IPO”) and other related Transactions, in order to carry on the business of Nextracker LLC. The Initial Public Offering On February 8, 2023, the Company's registration statement on Form S-1 relating to its IPO was declared effective by the Securities and Exchange Commission (“SEC”) and the shares of its Class A common stock began trading on the Nasdaq Global Select Market on February 9, 2023. The IPO closed on February 13, 2023, pursuant to which the Company issued and sold 30,590,000 shares of its Class A common stock at a public offering price of $24.00 per share, giving effect to the exercise in full of the underwriters' option to purchase additional shares. The Company received net proceeds of $693.8 million, after deducting $40.4 million in underwriting discounts. The Company used all of the net proceeds from the IPO to purchase its member's interest in Nextracker LLC from Flex and holds a member’s interest of approximately 32% of Nextracker LLC as of June 30, 2023. On July 3, 2023 the Company completed a follow-on offering of Class A common stock. See further discussion in Note 12. |
Summary of accounting policies
Summary of accounting policies | 3 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of accounting policies | Summary of accounting policies Variable interest entities ("VIE") and consolidation Subsequent to the IPO, the Company’s sole material asset is its member’s interest in Nextracker LLC. In accordance with the Nextracker LLC Operating Agreement, the Company was named the managing member of Nextracker LLC. As a result, the Company has all management powers over the business and affairs of Nextracker LLC and to conduct, direct and exercise full control over the activities of Nextracker LLC. Class A common stock issued in the IPO does not hold majority voting rights but hold 100% of the economic interest in the Company, which results in Nextracker LLC being considered a VIE. Due to the Company’s power to control the activities most directly affecting the results of Nextracker LLC, the Company is considered the primary beneficiary of the VIE. Accordingly, beginning with the IPO, the Company consolidates the financial results of Nextracker LLC and its subsidiaries. Member’s interest in Nextracker LLC held by Yuma, Inc. ("Yuma"), Yuma Subsidiary, Inc., a Delaware corporation and wholly-owned subsidiary of Yuma ("Yuma Sub"), TPG Rise Flash, L.P. ("TPG") and the TPG affiliates are presented on the condensed consolidated balance sheets as temporary equity under the caption “Redeemable non-controlling interests.” Basis of presentation The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the SEC for reporting interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements, and should be read in conjunction with the Company’s audited consolidated financial statements as of and for the fiscal year ended March 31, 2023, contained in the Company’s Annual Report on Form 10-K (the "Form 10-K"). In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary to present the Company's financial statements fairly have been included. Operating results for the three-month period ended June 30, 2023 are not necessarily indicative of the results that may be expected for the fiscal year ending March 31, 2024 or any future period. All intracompany transactions and accounts within Nextracker have been eliminated. Prior to the Transactions (as described in Note 5), Nextracker did not operate as a separate entity and stand-alone separate historical financial statements for Nextracker were not prepared. Accordingly, the unaudited condensed consolidated financial statements for the three-month period ended July 1, 2022 were derived from Flex’s historical accounting records and were presented on a carve-out basis and include allocations of certain costs from Flex incurred on Nextracker’s behalf. Such costs may not have represented the amounts that would have been incurred had Nextracker operated autonomously or independently from Flex during the period preceding the IPO. The condensed consolidated balance sheet as of March 31, 2023 was derived from the Company’s audited consolidated financial statements included in the Form 10-K. The first quarters for fiscal years 2024 and 2023 ended on June 30, 2023 (91 days), and July 1, 2022 (92 days), respectively. Use of estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. Estimates are used in accounting for, among other things, impairment of goodwill, impairment of long-lived assets, allowance for doubtful accounts, reserve for excess or obsolete inventories, valuation of deferred tax assets, warranty reserves, contingencies, operation accruals, and fair values of awards granted under stock-based compensation plans. Due to the long-term economic effect of the COVID-19 pandemic and geopolitical conflicts (including the Russian invasion of Ukraine), there has been and will continue to be uncertainty and disruption in the global economy and financial markets. The Company has made estimates and assumptions taking into consideration certain possible impacts due to the COVID-19 pandemic and the Russian invasion of Ukraine. These estimates may change, as new events occur, and additional information is obtained. Actual results may differ from previously estimated amounts, and such differences may be material to the condensed consolidated financial statements. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period they occur. Management believes that these estimates and assumptions provide a reasonable basis for the fair presentation of the condensed consolidated financial statements. Product warranty Nextracker offers an assurance type warranty for its products against defects in design, materials and workmanship for a period ranging from five The following table summarizes the activity related to the estimated accrued warranty reserve for the three-month periods ended June 30, 2023 and July 1, 2022: Three-month periods ended (In thousands) June 30, 2023 July 1, 2022 Beginning balance $ 22,591 $ 10,485 Provision (release) for warranties issued (1,582) 127 Payments (278) (225) Ending balance $ 20,731 $ 10,387 Inventories Inventories are stated at the lower of cost (on a first-in, first-out basis) or net realizable value. Nextracker’s inventory primarily consists of finished goods to be used and to be sold to customers, including components procured to complete the tracker system projects. Other current assets Other current assets include short-term deposits and advances of $74.9 million and $29.3 million as of June 30, 2023 and March 31, 2023, respectively, primarily related to advance payments to certain vendors for procurement of inventory. Accrued expenses Accrued expenses include accruals primarily for freight and tariffs of $42.6 million and $44.6 million as of June 30, 2023 and March 31, 2023, respectively. In addition, it includes $14.7 million and $15.2 million of accrued payroll as of June 30, 2023 and March 31, 2023, respectively. TRA liability and other liabilities Tax Receivable Agreement ("TRA") liability and other liabilities primarily include the liability of $230.3 million as of June 30, 2023 and March 31, 2023, related to the expected amount to be paid to Yuma, Yuma Sub, TPG and the TPG affiliates pursuant to the TRA. Additionally, the balance includes the long-term portion of standard product warranty liabilities of $10.4 million and $11.8 million, respectively, and the long-term portion of deferred revenue of $35.6 million and $35.8 million as of June 30, 2023 and March 31, 2023, respectively. Redeemable non-controlling interests The balance of the redeemable non-controlling interests is reported at the greater of the initial carrying amount adjusted for the redeemable non-controlling interest’s share of earnings or losses and other comprehensive income or loss, or its estimated maximum redemption amount. The resulting changes in the estimated maximum redemption amount (increases or decreases) are recorded with corresponding adjustments against retained earnings or, in the absence of retained earnings, additional paid-in-capital. These interests are presented on the condensed consolidated balance sheets as temporary equity under the caption “Redeemable non-controlling interests.” The following table present a reconciliation of the change in redeemable non-controlling interests for the period presented: Three-month period ended (in thousands) Balance at beginning of period $ 3,560,628 Net income attributable to redeemable non-controlling interests 43,216 Redemption value adjustment 305,678 Balance at end of period $ 3,909,522 The maximum redemption amount was higher than the carrying amount adjusted for the redeemable non-controlling interest’s share of earnings as of June 30, 2023 as a result of the increase in the Company's share price as of June 30, 2023 as compared to March 31, 2023. |
Revenue
Revenue | 3 Months Ended |
Jun. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Based on ASC 606 provisions, the Company disaggregates its revenue from contracts with customers by those sales recorded over time and sales recorded at a point in time. The following table presents Nextracker’s revenue disaggregated based on timing of transfer—point in time and over time for the three-month periods ended June 30, 2023 and July 1, 2022: Three-month periods ended (In thousands) June 30, 2023 July 1, 2022 Timing of Transfer Point in time $ 5,641 $ 23,251 Over time 473,902 379,979 Total revenue $ 479,543 $ 403,230 Contract balances The timing of revenue recognition, billings and cash collections results in contract assets and contract liabilities (deferred revenue) on the condensed consolidated balance sheets. Nextracker’s contract amounts are billed as work progresses in accordance with agreed-upon contractual terms, which generally coincide with the shipment of one or more phases of the project. When billing occurs subsequent to revenue recognition, a contract asset results. Contract assets of $320.1 million and $298.0 million as of June 30, 2023 and March 31, 2023, respectively, are presented in the condensed consolidated balance sheets, of which $122.7 million and $116.3 million, respectively, will be invoiced at the end of the projects as they represent funds withheld until the products are installed by a third party, arranged by the customer, and the project is declared operational. The remaining unbilled receivables will be invoiced throughout the project based on a set billing schedule such as milestones reached or completed tracker rows delivered. Contract assets increased $22.1 million from March 31, 2023 to June 30, 2023 due to fluctuations in the timing and volume of billings for the Company’s revenue recognized over time. During the three-month periods ended June 30, 2023 and July 1, 2022 , Nextracker convert ed $71.4 million an d $56.3 million of d eferred revenue to revenue, respectively, which represente d 34% and 52% , respectively, of the beginning period balance of deferred revenue. Remaining performance obligations As of June 30, 2023, Nextracker had $286.6 million of the transaction price allocated to the remaining performance obligations. The Company expects to recognize revenue on approximately 88% of these performance obligations in the next 12 months. The remaining long-term unperformed obligations primarily relate to extended warranty and deposits collected in advance on certain tracker projects. |
Goodwill and intangible assets
Goodwill and intangible assets | 3 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and intangible assets | Goodwill and intangible assets Goodwill Goodwill relates to the 2015 acquisition of Nextracker LLC and the 2016 acquisition of BrightBox by Flex on behalf of Nextracker LLC. As of June 30, 2023 and March 31, 2023, goodwill totaled $265.2 million, respectively and is not deductible for tax purposes. Other intangible assets The components of identifiable intangible assets are as follows: As of June 30, 2023 As of March 31, 2023 (In thousands) Gross Accumulated Net Gross Accumulated Net Intangible assets: Trade name and other intangibles $ 2,500 $ (1,242) $ 1,258 $ 2,500 $ (1,179) $ 1,321 Total $ 2,500 $ (1,242) $ 1,258 $ 2,500 $ (1,179) $ 1,321 Total intangible asset amortization expense recognized in operations was immaterial for the periods presented. |
The Transactions
The Transactions | 3 Months Ended |
Jun. 30, 2023 | |
Equity [Abstract] | |
The Transactions | The Transactions The Company and Nextracker LLC completed the following reorganization and other transactions in connection with the IPO (collectively, referred to as the “Transactions”): • Immediately prior to the completion of the IPO, Nextracker Inc. issued 128,794,522 shares of its Class B common stock to Yuma, Yuma Sub, and TPG Rise in exchange for cash consideration, which number of shares was equal to the number of common units of Nextracker LLC held directly or indirectly by Yuma, Yuma Sub and TPG Rise (not inclusive of those held by affiliated blocker corporations – see below) immediately following the Transactions and before giving effect to the IPO. • Immediately prior to the completion of the IPO and as permitted under and in accordance with the limited liability company agreement of Nextracker LLC in effect prior to the IPO (the “Prior LLC Agreement”), TPG Rise exercised its right to have certain blocker corporations affiliated with TPG Rise each merge with a separate direct, wholly-owned subsidiary of Nextracker Inc., with the blocker corporations surviving each such merger, in a transaction intended to qualify as a tax-free transaction. In connection with such blocker corporations’ mergers, the investors in each such blocker corporation received a number of shares of Nextracker Inc.’s Class A common stock with a value based on the Series A Preferred Units held by such blocker corporation for a total of 15,279,190 shares of Nextracker Inc.’s Class A common stock. • Immediately prior to the closing of the IPO, Nextracker LLC made a distribution in an aggregate amount of $175.0 million (the “Distribution”). With respect to such Distribution, $21.7 million was distributed to TPG Rise and $153.3 million to Yuma and Yuma Sub in accordance with their pro rata units of Nextracker LLC. The Distribution was financed, in part, with net proceeds from the $150.0 million term loan under the 2023 Credit Agreement. • Nextracker Inc. used all the net proceeds from the IPO ($693.8 million) as consideration for Yuma’s transfer to Nextracker Inc. of 30,590,000 Nextracker LLC common units at a price per unit equal to $22.68. • In connection with Yuma’s transfer to Nextracker Inc. of 30,590,000 Nextracker LLC common units, a corresponding number of shares of Nextracker Inc.’s Class B common stock held by Yuma were canceled. • In connection with the IPO, Nextracker Inc. repurchased all 100 shares of common stock previously issued to Yuma for an immaterial amount. On February 8, 2023, the Company amended and restated its certificate of incorporation to, among other things, authorize 900,000,000 shares of $0.0001 par value Class A common stock, 500,000,000 shares of $0.0001 par value Class B common stock, and 50,000,000 shares of par value $0.0001 preferred stock. On February 13, 2023, the members of Nextracker LLC entered into the Third Amended and Restated Limited Liability Company Agreement of Nextracker LLC to, among other things, effect the Transactions described above and to appoint Nextracker Inc. as the managing member of Nextracker LLC. Nextracker Inc. beneficially owns 45,886,065 Nextracker LLC common units after the completion of the IPO and the Transactions and as of June 30, 2023. Exchange Agreement The Company, Nextracker LLC, the LLC, Yuma, Yuma Sub and TPG entered into an exchange agreement (the “Exchange Agreement”) under which Yuma, Yuma Sub and TPG (or certain permitted transferees thereof) have the right, subject to the terms of the Exchange Agreement, to require Nextracker LLC to exchange Nextracker LLC common units (together with a corresponding number of shares of Class B common stock) for newly-issued shares of Class A common stock of Nextracker Inc. on a one-to-one basis, or, in the alternative, Nextracker Inc. may elect to exchange such Nextracker LLC common units (together with a corresponding number of shares of Nextracker Inc. Class B common stock) for cash equal to the product of (i) the number of Nextracker LLC common units (together with a corresponding number of shares of Class B common stock) being exchanged, (ii) the then-applicable exchange rate under the Exchange Agreement (which will initially be one and is subject to adjustment) and (iii) the Class A common stock value (based on the market price of our Class A common stock), subject to customary conversion rate adjustments for stock splits, stock dividends, reclassifications and other similar transactions; provided further, that in the event of an exchange request by an exchanging holder, Nextracker Inc. may at its option effect a direct exchange of shares of Class A common stock for Nextracker LLC common units and shares of Class B common stock in lieu of such exchange or make a cash payment to such exchanging holder, in each case pursuant to the same economic terms applicable to an exchange between the exchanging holder and Nextracker LLC. As Nextracker LLC interests are redeemable upon the occurrence of an event not solely within the control of the Company, such interests are presented in temporary equity on the condensed consolidated balance sheets. |
Stock-based compensation
Stock-based compensation | 3 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement, Additional Disclosure [Abstract] | |
Stock-based compensation | Stock-based compensationThe Company adopted the First Amended and Restated 2022 Nextracker LLC Equity Incentive Plan in April 2022 (the “LLC Plan”), which provides for the issuance of options, unit appreciation rights, performance units, performance incentive units, restricted incentive units and other unit-based awards to employees, directors, and consultants of the Company. Additionally, in connection with the IPO in February 2023, the Company approved the Second Amended and Restated 2022 Nextracker Inc. Equity Incentive Plan (the “NI Plan,” and collectively with the LLC Plan, the “2022 Plan”) to reflect, among other things, that the underlying equity interests with respect to awards issued under the LLC Plan shall, in lieu of common units of Nextracker LLC, relate to Class A common stock of Nextracker for periods from and after the closing of the IPO. In addition to the 2022 Plan, certain executives, officers and employees of the Company also participate in the Flex 2017 equity incentive plan (the “Flex 2017 Plan”), and as such, stock-based compensation expense for the period presented also include expense recognized under the Flex 2017 Plan. The following table summarizes the Company’s stock-based compensation expense under the 2022 Plan and the Flex 2017 Plan: Three-month periods ended (In thousands) June 30, 2023 July 1, 2022 Cost of sales $ 1,926 $ 410 Selling, general and administrative expenses 6,715 595 Total stock-based compensation expense $ 8,641 $ 1,005 Stock-based compensation expense includes an allocation of Flex’s corporate and shared functional employee expense of immaterial amounts for the three-month periods ended June 30, 2023 and July 1, 2022. These charges were recorded within selling, general and administrative expenses. The 2022 Nextracker equity incentive plan During the three-month period ended June 30, 2023, the Company granted 0.5 million time-based unvested restricted share units ("RSU") awards to certain of its employees under the 2022 Plan. The vesting for these unvested RSU awards is contingent upon time-based vesting with continued service over a three-year period from the grant date, with a portion of the awards vesting at the end of each year. The weighted average fair value per share of the RSUs granted during the period was estimated to be $39.70 per award. In addition, the Company also granted 0.4 million performance based vesting ("PSU") awards whereby vesting is generally contingent upon (i) time-based vesting with continued service through March 31, 2026, and (ii) the achievement of certain metrics specific to the Company, which could result in a range of 0 -300% of such PSUs ultimately vesting. The weighted average fair value per share of the PSUs granted during the period was estimated to be $40.47 per award, which corresponds to the Company's closing price per share as of the grant date of the awards . Further, the Company granted 0.5 million options awards that will cliff-vest on the third anniversary of the grant date, subject generally to continuous service through such vesting date. The exercise price for the shares underlying such Options is equal to $40.47 per award, which corresponds to the Company's closing price per share as of the grant date of the awards. As a result of these new awards being granted close to the end of the first fiscal quarter, the Company is in the process of finalizing its estimate of the grant date fair value of the new options granted during the three-month period ended June 30, 2023. Additionally, during the three-month period ended June 30, 2023, an immaterial number of awards were forfeited due to employee terminations. The total unrecognized compensation expense related to unvested awards under the 2022 Nextracker Plan as of June 30, 2023 was approximately $61.0 million, which is expected to be recognized over a weighted-average period of approximately 2.53 years. The Flex 2017 equity incentive plan (the "2017 Plan") All options have been fully expensed and none were outstanding and exercisable as of June 30, 2023. The executives, officers and employees of Flex, including Nextracker, were granted restricted share unit (“RSU”) awards under the 2017 Plan. RSU awards are rights to acquire a specified number of ordinary Flex shares for no cash consideration in exchange for continued service with Flex. RSU awards generally vest in installments over a two As of June 30, 2023, the total unrecognized compensation cost related to unvested RSU awards held by Nextracker employees was approximately $1.4 million under the 2017 Plan. These costs will be amortized generally on a straight-line basis over a weighted-average period of approximately one year. There were no options and no RSU awards granted under the 2017 Plan during the three-month period ended June 30, 2023. |
Earnings per share
Earnings per share | 3 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Earnings per share | Earnings per share Basic earnings per share excludes dilution and is computed by dividing net income available to common stockholders of the Company for the three-month period ended June 30, 2023 by the weighted-average number of shares of Class A common stock outstanding during the same period. Diluted earnings per share reflects the potential dilution from stock-based compensation awards. The potential dilution from awards was computed using the treasury stock method based on the average fair market value of the Company’s Class A common stock for the period. Additionally, the potential dilutive impact of Class B common stock convertible into Class A was also considered in the calculation. The computation of earnings per share and weighted average shares outstanding of the Company’s common stock for the period is presented below: Three-month period ended June 30, 2023 Income Weighted average shares outstanding Per Share (in thousands except share and per share amounts) Numerator Denominator Amount Basic EPS Net income available to Nextracker Inc. common stockholders $ 20,429 46,411,859 $ 0.44 Effect of Dilutive impact Common stock equivalents from options awards (1) 896,988 Common stock equivalents from RSUs (2) 885,710 Common stock equivalents from PSUs (3) 469,773 Income attributable to non-controlling interests and common stock equivalent from Class B common stock $ 43,216 98,204,522 Diluted EPS Net income and comprehensive income $ 63,645 146,868,852 $ 0.43 (1) During the three-month period ended June 30, 2023, approximately 0.5 million options awards, were excluded from the computation of diluted earnings per share due to their anti-dilutive impact on the weighted-average ordinary share equivalents. (2) During the three-month period ended June 30, 2023, approximately 0.4 million RSU awards, were excluded from the computation of diluted earnings per share due to their anti-dilutive impact on the weighted-average ordinary share equivalents. (3) During the three-month period ended June 30, 2023, approximately 0.1 million PSU awards, were excluded from the computation of diluted earnings per share due to their anti-dilutive impact on the weighted-average ordinary share equivalents. |
Relationship with parent and re
Relationship with parent and related parties | 3 Months Ended |
Jun. 30, 2023 | |
Related Party Transactions [Abstract] | |
Relationship with parent and related parties | Relationship with parent and related parties Prior to the IPO, Nextracker was managed and operated in the normal course of business by Flex. Accordingly, certain shared costs were allocated to Nextracker and reflected as expenses in these condensed consolidated financial statements. Nextracker’s management and the management of Flex consider the expenses included and the allocation methodologies used to be reasonable and appropriate reflections of the historical Flex expenses attributable to Nextracker for purposes of the stand-alone financial statements up until the IPO. However, the expenses reflected in these condensed consolidated financial statements may not be indicative of the expenses that would have been incurred by Nextracker during the periods presented if Nextracker historically operated as a separate, stand-alone entity during such period, which expenses would have depended on a number of factors, including the chosen organizational structure, what functions were outsourced or performed by employees and strategic decisions made in areas such as information technology and infrastructure. In addition, the expenses reflected in the condensed consolidated financial statements for the period prior to the IPO may not be indicative of expenses that Nextracker will incur in the future. Allocation of corporate expenses The condensed consolidated financial statements for the period prior to the IPO, include expense allocations for certain functions provided by Flex, including, but not limited to, general corporate expenses related to finance, legal, information technology, human resources, and stock-based compensation. These expenses have been allocated to Nextracker on the basis of direct usage when identifiable, with the remainder allocated on the basis of revenue, headcount or other measure. During the three-month period ended July 1, 2022, Nextracker was allocated $2.4 million of general corporate expenses incurred by Flex. Of these expenses $1.6 million was included within selling, general and administrative expenses and $0.8 million was included in cost of sales in the condensed consolidated statements of operations and comprehensive income. An immaterial amount of general corporate expenses incurred by Flex was allocated to Nextracker during the three-month period ended June 30, 2023. Risk management Flex carries insurance for property, casualty, product liability matters, auto liability, and workers’ compensation and maintain excess policies to provide additional limits. Prior to the IPO, Nextracker paid a premium to Flex in exchange for the coverage provided. In fiscal year 2023, the policies with significant premiums included the Marine Cargo/Goods in Transit and the multiple Errors and Omissions policies all through various insurance providers. Expenses related to coverage provided by Flex were reflected in the condensed consolidated statements of operations and comprehensive income and were immaterial for the three-month periods ended June 30, 2023, and July 1, 2022, respectively. Cash management and financing Prior to the IPO, Nextracker participated in Flex’ centralized cash management programs. Disbursements were independently managed by Nextracker. All significant transactions between Nextracker and Flex that were not historically cash settled were reflected in the condensed consolidated statement of cash flows, for the period prior to the IPO, as net transfers to parent as these were deemed to be internal financing transactions. All intra-company accounts, profits and transactions have been eliminated. The following is a summary of material transactions reflected in the accumulated net parent investment during the three-month period ended July 1, 2022: Three-month periods ended (In thousands) July 1, 2022 Corporate allocations (excluding stock-based compensation expense) $ 1,360 Transfer of operations to Nextracker (1) 3,229 Net cash pooling activities (2) (8,908) Income taxes 5,170 Net transfers from Parent $ 851 (1) Primarily represents certain international operations where related income and/or losses are included in Nextracker’s condensed consolidated statements of operations. Cash was also collected by the international operations on behalf of Nextracker, for which Nextracker and Flex do not intend to settle in the future. (2) Primarily represents financing activities for cash pooling and capital transfers. The cash balance reflected in the condensed consolidated balance sheets consist of the cash managed and controlled by Nextracker. Prior to the IPO when Nextracker was a controlled entity of Flex, Nextracker's U.S. operations participated in the Flex cash pooling management programs intra-quarter; all outstanding positions were settled or scheduled for settlement as of each quarter end. Cash pooling activities during the period prior to the IPO were reflected under net transfers from Parent in the condensed consolidated statements of redeemable interest and stockholders' deficit /parent company equity (deficit), and the condensed consolidated statements of cash flows. Subsequent to the IPO, Nextracker has the option to participate in the Flex cash pooling management programs. Due to related parties relates to balances resulting from transactions between Nextracker and Flex subsidiaries that have historically been cash settled. Nextracker purchased certain components and services from other Flex affiliates of $29.6 million and $15.0 million for the three-month periods ended June 30, 2023, and July 1, 2022 respectively. Flex also administers on behalf of Nextracker payments to certain freight providers as well as payrolls to certain employees based in the U.S. Nextracker’s average due to related parties balance was $7.4 million and $31.4 million for the three-month periods ended June 30, 2023, and July 1, 2022, respectively. All related cash flow activities were classified within net cash provided by operating activities in the condensed consolidated statement of cash flows. |
Commitments and contingencies
Commitments and contingencies | 3 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and contingencies Litigation and other legal matters Nextracker has accrued for loss contingencies to the extent it believes that losses are probable and estimable. The amounts accrued are not material, but it is reasonably possible that actual losses could be in excess of Nextracker’s accrual. Any such excess loss could have a material adverse effect on Nextracker’s results of operations or cash flows for a particular period or on Nextracker’s financial condition. There were no additional accrual for loss contingencies during the three-month period ended June 30, 2023. |
Income taxes
Income taxes | 3 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes The Company follows the guidance under ASC 740-270, "Interim Reporting", which requires a company to calculate the income tax associated with ordinary income using an estimated annual effective tax rate ("AETR"). At the end of each interim period, the Company applies the AETR to year-to-date (YTD) ordinary income (or loss) to arrive at the YTD income tax expense. The Company recorded the tax effect of discrete items in the quarter in which the discrete events occur. The following table presents income tax expense recorded by the Company along with the respective consolidated effective tax rates for each period presented. For the three-month period ended June 30, 2023, the difference between the effective tax rate and the U.S. statutory corporate tax rate of 21% is primarily attributable to certain non-controlling interest in Nextracker LLC which is not taxable to Nextracker Inc. and its subsidiaries, partially offset by U.S. state and local income taxes and the jurisdictional mix of income between the U.S. and other operating jurisdictions. For the three-month period ended July 1, 2022 the effective tax rate differs from the U.S. statutory corporate tax rate of 21% primarily due to a tax benefit related to foreign derived intangible income, partially offset by U.S. state and local income taxes and the jurisdictional mix of income between the U.S. and other operating jurisdictions. Three-month periods ended (In thousands) June 30, 2023 July 1, 2022 Income tax 9,101 5,700 Effective tax rates 12.5 % 19.0 % |
Segment reporting
Segment reporting | 3 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
Segment reporting | Segment reportingOperating segments are defined as components of an enterprise for which separate financial information is available that is evaluated regularly by the Chief Operating Decision Maker (“CODM”), or a decision-making group, in deciding how to allocate resources and in assessing performance. Resource allocation decisions and Nextracker’s performance are assessed by its Chief Executive Officer, identified as the CODM. For all periods presented, Nextracker has one operating and reportable segment. The following table sets forth geographic information of revenue based on the locations to which the products are shipped: Three-month periods ended (In thousands) June 30, 2023 July 1, 2022 Revenue: U.S. $ 270,338 $ 269,390 Rest of the World 209,205 133,840 Total $ 479,543 $ 403,230 The United States is the principal country of domicile. |
Subsequent events
Subsequent events | 3 Months Ended |
Jun. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent events | Subsequent events The 2023 follow-on offering On July 3, 2023, Nextracker Inc. completed a follow-on offering to its IPO, which was completed on February 13, 2023, and issued 15,631,562 shares of Class A common stock and received net proceeds of $551.0 million. The entire net proceeds were used by Nextracker to acquire 14,025,000 Nextracker LLC common units from Yuma, and 1,606,562 Nextracker LLC common units from TPG Rise. Simultaneously, 14,025,000 and 1,606,562 shares of Class B shares were surrendered by Flex and TPG, respectively, and cancelled. As a result of this follow-on offering ( r eferred to as the “Follow-on”), as of the closing date on July 3, 2023: • The Company received net proceeds of $551.0 million (after underwriting discounts). Upon closing of the Follow-on, approximately $1.8 million of offering costs were paid by Flex. • Immediately following the completion of the Follow-on, Flex (through Yuma and Yuma Sub), owned 74,432,619 shares of Class B common stock, representing approximately 51.47% of the total outstanding shares of the Company's outstanding common stock. • Additionally, TPG owned 8,140,341 shares of Class B common stock representing approximately 5.63% of the total outstanding shares of the Company's outstanding common stock. • Nextracker Inc. beneficially owned 62,053,870 LLC units, representing approximately 42.91% of the total units of Nextracker LLC. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Pay vs Performance Disclosure | ||
Net income | $ 20,429 | $ 0 |
Summary of accounting policies
Summary of accounting policies (Policies) | 3 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation | Basis of presentation The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the SEC for reporting interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements, and should be read in conjunction with the Company’s audited consolidated financial statements as of and for the fiscal year ended March 31, 2023, contained in the Company’s Annual Report on Form 10-K (the "Form 10-K"). In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary to present the Company's financial statements fairly have been included. Operating results for the three-month period ended June 30, 2023 are not necessarily indicative of the results that may be expected for the fiscal year ending March 31, 2024 or any future period. All intracompany transactions and accounts within Nextracker have been eliminated. Prior to the Transactions (as described in Note 5), Nextracker did not operate as a separate entity and stand-alone separate historical financial statements for Nextracker were not prepared. Accordingly, the unaudited condensed consolidated financial statements for the three-month period ended July 1, 2022 were derived from Flex’s historical accounting records and were presented on a carve-out basis and include allocations of certain costs from Flex incurred on Nextracker’s behalf. Such costs may not have represented the amounts that would have been incurred had Nextracker operated autonomously or independently from Flex during the period preceding the IPO. The condensed consolidated balance sheet as of March 31, 2023 was derived from the Company’s audited consolidated financial statements included in the Form 10-K. |
Use of estimates | Use of estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. Estimates are used in accounting for, among other things, impairment of goodwill, impairment of long-lived assets, allowance for doubtful accounts, reserve for excess or obsolete inventories, valuation of deferred tax assets, warranty reserves, contingencies, operation accruals, and fair values of awards granted under stock-based compensation plans. Due to the long-term economic effect of the COVID-19 pandemic and geopolitical conflicts (including the Russian invasion of Ukraine), there has been and will continue to be uncertainty and disruption in the global economy and financial markets. The Company has made estimates and assumptions taking into consideration certain possible impacts due to the COVID-19 pandemic and the Russian invasion of Ukraine. These estimates may change, as new events occur, and additional information is obtained. Actual results may differ from previously estimated amounts, and such differences may be material to the condensed consolidated financial statements. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period they occur. Management believes that these estimates and assumptions provide a reasonable basis for the fair presentation of the condensed consolidated financial statements. |
Product warranty | Product warranty Nextracker offers an assurance type warranty for its products against defects in design, materials and workmanship for a period ranging from five The following table summarizes the activity related to the estimated accrued warranty reserve for the three-month periods ended June 30, 2023 and July 1, 2022: Three-month periods ended (In thousands) June 30, 2023 July 1, 2022 Beginning balance $ 22,591 $ 10,485 Provision (release) for warranties issued (1,582) 127 Payments (278) (225) Ending balance $ 20,731 $ 10,387 |
Inventories | Inventories Inventories are stated at the lower of cost (on a first-in, first-out basis) or net realizable value. Nextracker’s inventory primarily consists of finished goods to be used and to be sold to customers, including components procured to complete the tracker system projects. |
Redeemable non-controlling interests | Redeemable non-controlling interests The balance of the redeemable non-controlling interests is reported at the greater of the initial carrying amount adjusted for the redeemable non-controlling interest’s share of earnings or losses and other comprehensive income or loss, or its estimated maximum redemption amount. The resulting changes in the estimated maximum redemption amount (increases or decreases) are recorded with corresponding adjustments against retained earnings or, in the absence of retained earnings, additional paid-in-capital. These interests are presented on the condensed consolidated balance sheets as temporary equity under the caption “Redeemable non-controlling interests.” |
Summary of accounting policie_2
Summary of accounting policies (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Product Warranty | The following table summarizes the activity related to the estimated accrued warranty reserve for the three-month periods ended June 30, 2023 and July 1, 2022: Three-month periods ended (In thousands) June 30, 2023 July 1, 2022 Beginning balance $ 22,591 $ 10,485 Provision (release) for warranties issued (1,582) 127 Payments (278) (225) Ending balance $ 20,731 $ 10,387 |
Redeemable Noncontrolling Interest | The following table present a reconciliation of the change in redeemable non-controlling interests for the period presented: Three-month period ended (in thousands) Balance at beginning of period $ 3,560,628 Net income attributable to redeemable non-controlling interests 43,216 Redemption value adjustment 305,678 Balance at end of period $ 3,909,522 |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Nextracker's Revenue Disaggregation | The following table presents Nextracker’s revenue disaggregated based on timing of transfer—point in time and over time for the three-month periods ended June 30, 2023 and July 1, 2022: Three-month periods ended (In thousands) June 30, 2023 July 1, 2022 Timing of Transfer Point in time $ 5,641 $ 23,251 Over time 473,902 379,979 Total revenue $ 479,543 $ 403,230 |
Goodwill and intangible assets
Goodwill and intangible assets (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | The components of identifiable intangible assets are as follows: As of June 30, 2023 As of March 31, 2023 (In thousands) Gross Accumulated Net Gross Accumulated Net Intangible assets: Trade name and other intangibles $ 2,500 $ (1,242) $ 1,258 $ 2,500 $ (1,179) $ 1,321 Total $ 2,500 $ (1,242) $ 1,258 $ 2,500 $ (1,179) $ 1,321 |
Stock-based compensation (Table
Stock-based compensation (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement, Additional Disclosure [Abstract] | |
Schedule of Employee Service Share Based Compensation Allocation of Recognized Period Costs | The following table summarizes the Company’s stock-based compensation expense under the 2022 Plan and the Flex 2017 Plan: Three-month periods ended (In thousands) June 30, 2023 July 1, 2022 Cost of sales $ 1,926 $ 410 Selling, general and administrative expenses 6,715 595 Total stock-based compensation expense $ 8,641 $ 1,005 |
Earnings per share (Tables)
Earnings per share (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The computation of earnings per share and weighted average shares outstanding of the Company’s common stock for the period is presented below: Three-month period ended June 30, 2023 Income Weighted average shares outstanding Per Share (in thousands except share and per share amounts) Numerator Denominator Amount Basic EPS Net income available to Nextracker Inc. common stockholders $ 20,429 46,411,859 $ 0.44 Effect of Dilutive impact Common stock equivalents from options awards (1) 896,988 Common stock equivalents from RSUs (2) 885,710 Common stock equivalents from PSUs (3) 469,773 Income attributable to non-controlling interests and common stock equivalent from Class B common stock $ 43,216 98,204,522 Diluted EPS Net income and comprehensive income $ 63,645 146,868,852 $ 0.43 (1) During the three-month period ended June 30, 2023, approximately 0.5 million options awards, were excluded from the computation of diluted earnings per share due to their anti-dilutive impact on the weighted-average ordinary share equivalents. (2) During the three-month period ended June 30, 2023, approximately 0.4 million RSU awards, were excluded from the computation of diluted earnings per share due to their anti-dilutive impact on the weighted-average ordinary share equivalents. (3) During the three-month period ended June 30, 2023, approximately 0.1 million PSU awards, were excluded from the computation of diluted earnings per share due to their anti-dilutive impact on the weighted-average ordinary share equivalents. |
Relationship with parent and _2
Relationship with parent and related parties (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
Related Party Transactions [Abstract] | |
Summary of Material Transactions Reflected in Accumulated Net Parent Investment | The following is a summary of material transactions reflected in the accumulated net parent investment during the three-month period ended July 1, 2022: Three-month periods ended (In thousands) July 1, 2022 Corporate allocations (excluding stock-based compensation expense) $ 1,360 Transfer of operations to Nextracker (1) 3,229 Net cash pooling activities (2) (8,908) Income taxes 5,170 Net transfers from Parent $ 851 (1) Primarily represents certain international operations where related income and/or losses are included in Nextracker’s condensed consolidated statements of operations. Cash was also collected by the international operations on behalf of Nextracker, for which Nextracker and Flex do not intend to settle in the future. |
Income taxes (Tables)
Income taxes (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Summary of Income Tax Expense | The following table presents income tax expense recorded by the Company along with the respective consolidated effective tax rates for each period presented. For the three-month period ended June 30, 2023, the difference between the effective tax rate and the U.S. statutory corporate tax rate of 21% is primarily attributable to certain non-controlling interest in Nextracker LLC which is not taxable to Nextracker Inc. and its subsidiaries, partially offset by U.S. state and local income taxes and the jurisdictional mix of income between the U.S. and other operating jurisdictions. For the three-month period ended July 1, 2022 the effective tax rate differs from the U.S. statutory corporate tax rate of 21% primarily due to a tax benefit related to foreign derived intangible income, partially offset by U.S. state and local income taxes and the jurisdictional mix of income between the U.S. and other operating jurisdictions. Three-month periods ended (In thousands) June 30, 2023 July 1, 2022 Income tax 9,101 5,700 Effective tax rates 12.5 % 19.0 % |
Segment reporting (Tables)
Segment reporting (Tables) | 3 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
Summary of Geographic Information of Revenue | The following table sets forth geographic information of revenue based on the locations to which the products are shipped: Three-month periods ended (In thousands) June 30, 2023 July 1, 2022 Revenue: U.S. $ 270,338 $ 269,390 Rest of the World 209,205 133,840 Total $ 479,543 $ 403,230 |
Organization of Nextracker - Ad
Organization of Nextracker - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |||
Feb. 13, 2023 | Feb. 12, 2023 | Jun. 30, 2023 | Dec. 19, 2022 | |
Organization Consolidation And Presentation Of FinancialS tatements [Line Items] | ||||
Vesting of Nextracker Inc. RSU awards (in shares) | 0 | |||
Nextracker Inc | ||||
Organization Consolidation And Presentation Of FinancialS tatements [Line Items] | ||||
Noncontrolling interest, ownership percentage by parent | 32% | |||
IPO | Common Class A | ||||
Organization Consolidation And Presentation Of FinancialS tatements [Line Items] | ||||
Vesting of Nextracker Inc. RSU awards (in shares) | 30,590,000 | |||
Sale of stock price per share (in USD per share) | $ 24 | |||
Proceeds from the IPO | $ 693.8 | |||
Payments for underwriting expense | $ 40.4 | |||
Yuma, Inc. | Nextracker Inc | ||||
Organization Consolidation And Presentation Of FinancialS tatements [Line Items] | ||||
Noncontrolling interest, ownership percentage by parent | 100% | |||
Yuma, Inc. | IPO | ||||
Organization Consolidation And Presentation Of FinancialS tatements [Line Items] | ||||
Vesting of Nextracker Inc. RSU awards (in shares) | 30,590,000 | |||
Proceeds from the IPO | $ 693.8 |
Summary of accounting policie_3
Summary of accounting policies - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jun. 30, 2023 | Mar. 31, 2023 | |
Variable Interest Entity [Line Items] | ||
Advance deposits | $ 74.9 | $ 29.3 |
Accrued freight and tariffs | 42.6 | 44.6 |
Accrued payroll | $ 14.7 | 15.2 |
Minimum | ||
Variable Interest Entity [Line Items] | ||
Product warranty term | 5 years | |
Maximum | ||
Variable Interest Entity [Line Items] | ||
Product warranty term | 10 years | |
Tax Receivable Agreement | ||
Variable Interest Entity [Line Items] | ||
Liabilities Relating To Tax Receivable Agreement And Others | $ 230.3 | |
Other Noncurrent Liabilities | ||
Variable Interest Entity [Line Items] | ||
Standard product warranty liability non current | 10.4 | 11.8 |
Contract with customers liability non current | $ 35.6 | $ 35.8 |
Nextracker LLC | ||
Variable Interest Entity [Line Items] | ||
Variable interest entity, ownership percentage | 100% |
Summary of accounting policie_4
Summary of accounting policies - Summary of Product Warranty (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Movement in Standard and Extended Product Warranty Accrual, Increase (Decrease) [Roll Forward] | ||
Beginning balance | $ 22,591 | $ 10,485 |
Provision (release) for warranties issued | (1,582) | 127 |
Payments | (278) | (225) |
Ending balance | $ 20,731 | $ 10,387 |
Summary of accounting policie_5
Summary of accounting policies - Redeemable Noncontrolling Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Increase (Decrease) in Temporary Equity [Roll Forward] | ||
Balance at beginning of period | $ 3,560,628 | |
Net income attributable to redeemable non-controlling interests | 43,216 | $ 0 |
Redemption value adjustment | 305,678 | |
Balance at end of period | $ 3,909,522 |
Revenue - Summary of Nextracker
Revenue - Summary of Nextracker's Revenue Disaggregation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 479,543 | $ 403,230 |
Point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 5,641 | 23,251 |
Over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 473,902 | $ 379,979 |
Revenue - Additional Informatio
Revenue - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Jun. 30, 2023 | Jul. 01, 2022 | Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |||
Contract assets | $ 320,124 | $ 297,960 | |
Contract with customer assets funds withheld | 122,700 | $ 116,300 | |
Contract with customer asset change in measure of timing and volume of billings | 22,100 | ||
Contract with customer liability, revenue recognized | $ 71,400 | $ 56,300 | |
Percentage of revenue recognized | 34% | 52% | |
Transaction price allocated to performance obligation | $ 286,600 | ||
Revenue remaining performance obligation percentage | 88% |
Goodwill and Intangible asset_2
Goodwill and Intangible assets - Additional Information (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Mar. 31, 2023 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill | $ 265,153 | $ 265,153 |
Goodwill and intangible asset_3
Goodwill and intangible assets - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Mar. 31, 2023 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 2,500 | $ 2,500 |
Accumulated amortization | (1,242) | (1,179) |
Net carrying amount | 1,258 | 1,321 |
Trade name and other intangibles | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 2,500 | 2,500 |
Accumulated amortization | (1,242) | (1,179) |
Net carrying amount | $ 1,258 | $ 1,321 |
The Transactions (Details)
The Transactions (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | ||||
Feb. 13, 2023 | Feb. 12, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Feb. 08, 2023 | |
Shareholder equity and redeemable preferred units [Line Items] | |||||
Vesting of Nextracker Inc. RSU awards (in shares) | 0 | ||||
Common stock, shares authorized (in shares) | 500,000,000 | ||||
Preferred stock, shares authorized (in shares) | 50,000,000 | ||||
Preferred stock, par or stated value per share (in USD per share) | $ 0.0001 | ||||
IPO | |||||
Shareholder equity and redeemable preferred units [Line Items] | |||||
Distribution in an aggregate amount | $ 175 | ||||
IPO | Nextracker Inc. | |||||
Shareholder equity and redeemable preferred units [Line Items] | |||||
Common unit outstanding (in shares) | 45,886,065 | ||||
IPO | 2023 Credit Agreement | |||||
Shareholder equity and redeemable preferred units [Line Items] | |||||
Proceeds from term loan | 150 | ||||
IPO | Yuma, Inc. | |||||
Shareholder equity and redeemable preferred units [Line Items] | |||||
Vesting of Nextracker Inc. RSU awards (in shares) | 30,590,000 | ||||
Distribution in an aggregate amount | 153.3 | ||||
Proceeds from the IPO | 693.8 | ||||
Common unit price per unit (in USD per share) | $ 22.68 | ||||
Common unit outstanding (in shares) | 30,590,000 | ||||
Number of shares repurchased during the period (in shares) | 100 | ||||
IPO | TPG Rise | |||||
Shareholder equity and redeemable preferred units [Line Items] | |||||
Distribution in an aggregate amount | $ 21.7 | ||||
Common Class B | |||||
Shareholder equity and redeemable preferred units [Line Items] | |||||
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 | |||
Common stock, par or stated value per share (in USD per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||
Common Class B | IPO | Yuma, Inc. | |||||
Shareholder equity and redeemable preferred units [Line Items] | |||||
Vesting of Nextracker Inc. RSU awards (in shares) | 128,794,522 | ||||
Common Class A | |||||
Shareholder equity and redeemable preferred units [Line Items] | |||||
Common stock, shares authorized (in shares) | 900,000,000 | 900,000,000 | 900,000,000 | ||
Common stock, par or stated value per share (in USD per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||
Common Class A | TPG Rise | |||||
Shareholder equity and redeemable preferred units [Line Items] | |||||
Vesting of Nextracker Inc. RSU awards (in shares) | 15,279,190 | ||||
Common Class A | IPO | |||||
Shareholder equity and redeemable preferred units [Line Items] | |||||
Vesting of Nextracker Inc. RSU awards (in shares) | 30,590,000 | ||||
Proceeds from the IPO | $ 693.8 |
Stock-based compensation - Sche
Stock-based compensation - Schedule of Employee Service Share Based Compensation Allocation of Recognized Period Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | $ 8,641 | $ 1,005 |
Cost of Sales [Member] | ||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | 1,926 | 410 |
Selling, General and Administrative Expenses [Member] | ||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | $ 6,715 | $ 595 |
Stock-based compensation - Addi
Stock-based compensation - Additional information (Details) $ / shares in Units, $ in Millions | 3 Months Ended |
Jun. 30, 2023 USD ($) $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Outstanding options (in shares) | 0 |
Exercisable options (in shares) | 0 |
2017 Plan | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Gross number of share options granted during the period (in shares) | 0 |
Unrecognized compensation cost | $ | $ 1.4 |
Weighted-average period over which cost not yet recognized is expected to be recognized | 1 year |
2017 Plan | Common stock equivalents from RSUs | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of equity-based payment instruments granted during the period (in shares) | 0 |
2017 Plan | Common stock equivalents from RSUs | Minimum | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Award vesting period | 2 years |
2017 Plan | Common stock equivalents from RSUs | Maximum | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Award vesting period | 4 years |
2022 Nextracker plan | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Unrecognized compensation cost | $ | $ 61 |
Weighted-average period over which cost not yet recognized is expected to be recognized | 2 years 6 months 10 days |
2022 Nextracker plan | Common stock equivalents from RSUs | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of equity-based payment instruments granted during the period (in shares) | 500,000 |
Award vesting period | 3 years |
Weighted average grant date fair values (in USD per share) | $ / shares | $ 39.70 |
2022 Nextracker plan | Common stock equivalents from PSUs | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of equity-based payment instruments granted during the period (in shares) | 400,000 |
Weighted average grant date fair values (in USD per share) | $ / shares | $ 40.47 |
2022 Nextracker plan | Common stock equivalents from PSUs | Minimum | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Award vesting percentage | 0% |
2022 Nextracker plan | Common stock equivalents from PSUs | Maximum | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Award vesting percentage | 300% |
2022 Nextracker plan | Common stock equivalents from Options awards | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Options, weighted average grant date fair values (in USD per share) | $ / shares | $ 40.47 |
Gross number of share options granted during the period (in shares) | 500,000 |
Earnings per share - Schedule o
Earnings per share - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Jun. 30, 2023 USD ($) $ / shares shares | ||
Basic EPS | ||
Net income available to Nextracker Inc. common stockholders, Income | $ | $ 20,429 | |
Net income available to Nextracker Inc. common stockholders, weighted average shares outstanding (in shares) | 46,411,859 | [1] |
Net income available to Nextracker Inc. common stockholders, Per Share (in USD per share) | $ / shares | $ 0.44 | [1] |
Effect of Dilutive impact | ||
Income attributable to non-controlling interest and common stock equivalent from Class B common stock, Income | $ | $ 43,216 | |
Income attributable to non-controlling interest and common stock equivalent from Class B common stock , Weighted average shares outstanding (in shares) | 98,204,522 | |
Diluted EPS | ||
Net income available to Nextracker Inc. common stockholders, Income | $ | $ 63,645 | |
Net income available to Nextracker Inc. common stockholders, Weighted average shares outstanding | 146,868,852 | [1] |
Net income available to Nextracker Inc. common stockholders, Per Share (in USD per share) | $ / shares | $ 0.43 | [1] |
Common stock equivalents from Options awards | ||
Effect of Dilutive impact | ||
Common stock equivalents (in shares) | 896,988 | |
Diluted EPS | ||
Income attributable to non-controlling interest and common stock equivalent from Class B common stock , Weighted average shares outstanding (in shares) | 500,000 | |
Common stock equivalents from RSUs | ||
Effect of Dilutive impact | ||
Common stock equivalents (in shares) | 885,710 | |
Diluted EPS | ||
Income attributable to non-controlling interest and common stock equivalent from Class B common stock , Weighted average shares outstanding (in shares) | 400,000 | |
Common stock equivalents from PSUs | ||
Effect of Dilutive impact | ||
Common stock equivalents (in shares) | 469,773 | |
Diluted EPS | ||
Income attributable to non-controlling interest and common stock equivalent from Class B common stock , Weighted average shares outstanding (in shares) | 100,000 | |
[1] (1) Basic and diluted earnings per share is applicable only for the period following the initial public offering (“IPO”) and the related Transactions. See Note 5 for a description of the Transactions. |
Relationship with parent and _3
Relationship with parent and related parties - Additional information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Related Party Transaction [Line Items] | ||
Amount of transaction | $ 851 | |
Flex Ltd | ||
Related Party Transaction [Line Items] | ||
Related party transaction purchases from related party | $ 29,600 | 15,000 |
Related Party | Flex Ltd | ||
Related Party Transaction [Line Items] | ||
Amount of transaction | 2,400 | |
General and administrative expense | 1,600 | |
Cost of goods and services sold | 800 | |
Accounts payable | $ 7,400 | $ 31,400 |
Relationship with parent and _4
Relationship with parent and related parties - Summary of Material Transactions Reflected on Accumulated Net Parent Investment (Details) $ in Thousands | 3 Months Ended |
Jul. 01, 2022 USD ($) | |
Related Party Transaction [Line Items] | |
Net transfers from Parent | $ 851 |
Corporate allocations (excluding stock-based compensation expense) | |
Related Party Transaction [Line Items] | |
Net transfers from Parent | 1,360 |
Transfer of operations to Nextracker | |
Related Party Transaction [Line Items] | |
Net transfers from Parent | 3,229 |
Net cash pooling activities | |
Related Party Transaction [Line Items] | |
Net transfers from Parent | (8,908) |
Income taxes | |
Related Party Transaction [Line Items] | |
Net transfers from Parent | $ 5,170 |
Income Taxes - Summary of Incom
Income Taxes - Summary of Income Tax Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Income Tax Disclosure [Abstract] | ||
Income tax | $ 9,101 | $ 5,700 |
Effective tax rates | 12.50% | 19% |
Segment reporting - Additional
Segment reporting - Additional Information (Details) | 3 Months Ended |
Jun. 30, 2023 segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 1 |
Number of reportable segments | 1 |
Segment reporting - Summary of
Segment reporting - Summary of Geographic Information of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2023 | Jul. 01, 2022 | |
Revenue, Major Customer [Line Items] | ||
Revenue | $ 479,543 | $ 403,230 |
U.S. | ||
Revenue, Major Customer [Line Items] | ||
Revenue | 270,338 | 269,390 |
Rest of the World | ||
Revenue, Major Customer [Line Items] | ||
Revenue | $ 209,205 | $ 133,840 |
Subsequent events - Additional
Subsequent events - Additional Information (Details) - USD ($) $ in Millions | Jul. 03, 2023 | Jun. 30, 2023 | Mar. 31, 2023 |
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Common stock, shares, outstanding (in shares) | 62,053,870 | ||
Shares outstanding percentage owned | 42.91% | ||
Subsequent Event | Flex Ltd | |||
Subsequent Event [Line Items] | |||
Shares outstanding percentage owned | 51.47% | ||
Subsequent Event | Yuma, Inc | |||
Subsequent Event [Line Items] | |||
Number of shares repurchased during the period (in shares) | 14,025,000 | ||
Subsequent Event | TPG Rise | |||
Subsequent Event [Line Items] | |||
Number of shares repurchased during the period (in shares) | 1,606,562 | ||
Subsequent Event | Follow-on Offering | |||
Subsequent Event [Line Items] | |||
Consideration received on transaction | $ 551 | ||
Subsequent Event | Follow-on Offering | Flex Ltd | |||
Subsequent Event [Line Items] | |||
Payments of stock issuance costs | $ 1.8 | ||
Common Class A | |||
Subsequent Event [Line Items] | |||
Common stock, shares, outstanding (in shares) | 46,422,308 | 45,886,065 | |
Common Class A | Subsequent Event | Follow-on Offering | |||
Subsequent Event [Line Items] | |||
Number of shares issued in transaction (in shares) | 15,631,562 | ||
Common Class B | |||
Subsequent Event [Line Items] | |||
Common stock, shares, outstanding (in shares) | 98,204,522 | 98,204,522 | |
Common Class B | Subsequent Event | Flex Ltd | |||
Subsequent Event [Line Items] | |||
Stock repurchased and retired during period (in shares) | 14,025,000 | ||
Common stock, shares, outstanding (in shares) | 74,432,619 | ||
Common Class B | Subsequent Event | TPG Rise | |||
Subsequent Event [Line Items] | |||
Stock repurchased and retired during period (in shares) | 1,606,562 | ||
Common stock, shares, outstanding (in shares) | 8,140,341 | ||
Shares outstanding percentage owned | 5.63% |