SPWR - Earnings call transcript Q1 2019

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Operator

Good day, ladies and gentlemen, and welcome to the SunPower Corporation First Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode.

Following management’s prepared remarks, we will host a question-and-answer session and instructions will be given at that time. [Operator Instructions] As a reminder, this conference call may be recorded for replay purposes. It is now my pleasure to hand the conference over to Bob Okunski, Vice President of Investor Relations at SunPower Corporation. begin. may you Sir

Bob Okunski

I’d earnings welcome conference Brian. first to quarter XXXX call. like you, everyone to our Thank

On the our guidance. call review turning an Manu operational the today, our our we will strategic Sial, to financial from start first review call quarter Tom results who back Werner, CFO, CEO; XXXX by and followed will off before with for Tom

of today replay As call later Investor this a available of on a our Relations page reminder, be will the website.

our make will risks and we on the press SunPower. To may our that call, a information statements are the that in XX-Q. have various today's forward-looking During XXXX these Harbor sheet our affect today's to of subject & other forward-looking Presentations on set Tom reference additional Form to regarding we today's also posted detailing I'd turn With to supplemental a historical of of Please like and described during those Relations XX-K this are Werner, PowerPoint Reports slides, release, call will enhance Tom? have statements. call, the our presentation, that that, the some posted Events location we see factors we over uncertainties Quarterly for Investor which CEO website. call slide data those the Safe of of metrics. documents page same In

Tom Werner

revenue now call discuss performance our to an margin that performance we greater initiatives to targets update in provide Thanks, Bob position as strong will SPT various an SunPower business provide Europe and provide quarter year. We for DG for feel including detail. additional the color the improve our in thank as megawatt QX business on quarter adjusted each with will well and you we We this of QX, On turn Australia. financial in I'd slide our saw for profile particular and well shortly. like our us. overview demand in on our in business upstream joining I'll Technology Please first competitive meeting our executed XXXX strategic or EBITDA beat and traction exceeding forecast. forecast unit our or X. our global and

operating quarter. We continued we improving of the further lower C&I to proceeds which receive sheet expenses sale-leaseback our while in also monetization balance portfolio, second the will our of through

me in greater let detail. segment Now our performance discuss

to installation key First of an Energy despite slide SPES overview markets, DG certain Services, well the North the executed delays limited turn in business. which megawatt our and weather SunPower of American in quarter volume. Please X. impact

able were of we environment. However, and initial our backlog, to in loan continued due in efficiency line are These offset Important introduction and a pricing homes. and lease than mix added of new volume the positive. with traction tripling NGT has year-over-year. gain our customer to to the Maxeon technology. new megawatt homes which XXX-watt while of the milestone improved operational We XX,XXX rated management new residential A-Series first cash QX is using our product more panels was stable X impact industry's products with to forecast this extremely or panels prudent Gen our expenses, now been reaction was The

cost. reducing improves and yielding investments recently measurable revolutionary the system lowering digital that design ongoing instant time a in software experience also design customer Our are benefits. We significantly previewed while

both than year. of remains businesses. our pipeline CVAR billion. on maintained with product Equinox on Finally, $X our significant and our the second strong XX% our residential number this In direct share and to and momentum exceeds half to progress this launch continue offering greater XXXX one we C&I, make in position remain plan we booked storage in

third quarter. the business in this turning Forecast profitable

booked storage XX-megawatt now Our Helix projects rates California we Hawaii. high attach with storage solution hours is in as of have selling and well

exceeds Our now well. Helix XXX pipeline as megawatts storage

manufactured facility. U.S. our panel the in our in Finally, Oregon commercial we P-XX launched market,

system As This the we now experience systems the highlighting of slide of to software built committed design developing market. have learning. in -- platform to algorithms discussed are market, and new chain. learns Instant X. we efficiently the It includes trained seconds automatically -- energy advantage giving minutes few our retrofit new like customer machine X. the the can like first complicated the how Design, past in existing location system this In digital installed time-consuming, slide in the quickly still in from with now configuration additional for solar Design, improve deploying overall costs, design over residential designs customer optimum system launch key create a turn modify conference With technology system and creates for is to This this providing design a build to panels Please of this cost year digital and a time Instant is market. feedback Homeowners technology and and online does reduce that on adding XX The reduce using summer. continuously and reducing see home. serve called and spend optimized energy We're April. improving homeowners across the the delivery. SunPower platform program. we turn that's Design Instant their Safe efficiency for innovation and XX our the immediate system Design further an minutes roof a some unique. design cost. SunPower our experience streamline are that Cloud few an to to color evaluating flexibility a at example our every impact the performance, optimized optimized library. a accuracy. to while are their innovation technology believe SunPower expanding to I'd customer or spend to to less minutes want a design of I'd Next home foundation software improve needs. per solar seconds That to residential but our on can SunPower providing creates we we residential first algorithm Please designing acquisition online, every we recently Harbor going Instant and designs customers will in using than systems lowering on value We turnaround be this The that XXX,XXX performance. Google system featuring on savings. We subtracting debut to while

Day gives or the integrated to and XXX a XXXX case lease This as business approximately significant the the business beyond. model. business Safe our industry Harbor technology we our commercial Safe that ITC the expect well We believe in predictable supply our on We see distinct mentioned has in chain we megawatts our the planned Harbor for of of SPES due and both SunPower and preserve XX% business. Capital as certainty benefit direct our the vertically has residential two Safe modules the highest sufficient tariffs. month, to As cost provisions. XXX last Markets on to quality in this capitalize in advantage Between us a we Section exclusion Harbor that opportunity businesses, modules proven from

for will Maxeon and be will our competitive industry-leading technology from industry-leading half performance, provide With we types, potential appetite of Also watts, A-Series panel are few with We will us now while are significant of maximizing of to such XXX safe see confident customers executing that rating capital. we an a years financings margins XXXX. currently require be the of power that will be discussions use for second enable in panel. for the we under a begin expect the example, SunPower company. harboring substantive in to programs number For with financiers will our minimal investment the

business me X. turn our Technologies SunPower greater in detail. Please to discuss Now let slide

executed targets full and cost team manufacturing again Our QX fab utilization. our in with shipment exceeding for yield the well and meeting guidance quarter

with hitting expansion for with in Production X track our Our in now X of production. for X solar are cell our gigawatts X for complete Finding this sources well When the factory at and of initial megawatts. at commitments technology main Oregon is line year, performance in next-generation plate production goals of XX%, tools underwriting Maxeon installation DZS efficiencies venture will the capacity XXX second line. P-Series be technology going of volume end our capacity on of our is our also further summer. joint Maxeon

posted channels sales international performance SPT as strong Our well.

have focus our offering retooled on We to product the market. DG

and DG volume for plan demand We of in the are with seeing shipments to particularly in benefits DG coming accounted strong quarter. Australia. margins sales now for volume, the overall Europe driven our ASPs XX% and by above close

megawatts. a We QX our backlog plant also power to continued exceeds XXXX for during that shipment XXX with the balance of expand

Europe X. strong remains highlight to DG me market for international let turn our us. Now Please slide performance. SPT market QX a

France particular We Italy, there Benelux and since countries. have strength XXXX doubled share our with in

in seeing demand are for panel residential-format very demand We two P-Series our Europe Maxeon strong and recently XXX-watt continued introduced growth line our recently including product panels. for launched

in also its new and demand exceeded capitalize in by we product. QX Maxeon on panels. saw our P-Series P-XX Asia as DG driven QX Pacific demand plan Australia strong We markets. above was for Japan our residential forecast both

East more our P-XX our during growth applications. quarter demand In products. and between in across than new of product plant, megawatts P-Series we number We success seeing XXX Asian primarily are shipped driven South a power rapid with by commercial the markets Maxeon

to investing new our our and than market reactions our footprint volume expand of strong Pacific number Asia markets across portfolio, of are triple sales we expect XXXX. world DG shipment in new the Given and a to more to product rest

provide our on I Please EBITDA our slide to Manu X reach to achieving Before to call the XXXX drivers key highlight the financial would turning over XXXX comments financials, while confidence some adjusted turn to target. like I the in for forecasts. our

scale First and P-Series volume reduction to both ramps. cost our continuing and technology which highlighted will previously, benefit we and are NGT as volume from ramp of I

to also from we to adjust We Modco's our our have model expect ability benefit and fab's related as harbor the our output program. flexible safe a

will in the cost the margin Finally, maintain to drive pricing improvement of we which second half with premium gross our this expect decline, year.

for volume account expect to We increased EBITDA to close XX% and half the second performance. scale our for

technology. Second

manufacturing increased margin the of watt NGT On and volumes provides material per cost side lowers expansion.

the remains We platform. storage highly storage also benefit The our accretive. from rollout of Helix continued

improve better beginning customer just XX% just year. second our these in investments half we're cost benefit our more Design. see will driving to Instant of initiatives We lead These capabilities, as our lower in in acquisition operational generation initiatives improvement I performance drive the EBITDA from efficiency. such discussed, the As than digital

our Third cost the and initiatives. in optimization continued management initiatives both America as These prudent expenses. include our business of SPT commercial North for in our supply operating well chain as

initiatives finance expect Manu Sachs, lease than like facility and industrial over to our to margins. QX. to commercial our our QX accounting would previously mentioned the gains see turn XX% financials. more Goldman With in we our capital for the residential with EBITDA I review through of improving Manu? lower our call to Additionally, and We cost of while cost that,

Manu Sial

Thanks, Tom.

Now due into financials. demand sequentially, adjusted our seasonality we EBITDA let businesses, we down Overall, continuing improve turn and significantly, our me demand strong ready positive commitment slide overall and where commercial financial our residential QX key increased was both from deep the last with We XX. with including trend look execution. the second revenue saw In starting month in our of quarter. as revenue international met profile our above benefited was non-GAAP our SPES the DG this results commitments as forecast. our to we Please to

megawatts XXX plant both plan. the DG shipped of businesses and we SPT, quarter For in power ahead came during our as

in were half gross weather Our partially severe to forecast. to for offset our of was remained quarter. margins the Commercial able in as margin key ready In versus consolidated ahead second moderately declined last to margin primarily pricing dated mix due markets slightly gross were we backlog. lower X% so due quarter, stable the non-GAAP impact SPES the

ramp our also was million with line We and improve In Fab the margins see chain essentially our through second $XX breakeven impacted to the cost though XXXX quarter. with QX, margins given during as EBITDA we our a improving and XXXX expenses we backlog line to negative quarter expect managed SPT, for by gross NGT the P-Series, SPT OpEx is than million X commitments NGT-related commercial million, with our Non-GAAP and our supply $XXX line the structures. in ramp and Oregon in $X the and Adjusted were to as gross we our of was OpEx line related less strong go started install was margin Malaysia. million. continue at forecast. of in for $XX CapEx in quarter

a and on quarter. like basis a financial highlights initiatives. As strong slide I'd EBITDA adjusted few roadmaps to Please discuss the for year as quarterly mentioned, cost we we see improving to Tom a now visibility, through XX. given revenue go turn technology the

key quarter financial guidance. for As EBITDA previously shipment our mentioned, our adjusted the commitments exceeding we met including while our

We our million. streamline the also commercial continued a during for with leaseback portfolio balance monetization sale our than quarter to $XX sheet of more

timing of sheet. reflected transaction of balance on the the the Given of end will quarter, majority be the proceeds the the at our QX significant

these If to QX a balance we million ended you our proceeds XXXX on forma the than in sheet quarter have basis, more add would cash. with pro $XXX

sheet our expected confident performance, XXXX debt convert operating our and in initiatives in Additionally, to given retire we improvements our ability remain maturity. balance our

SPES. and for significantly DG we also financing return initiatives will of margins, that capital capital, minimize in improve We put number employed working improve place believe in strategic a

and model Markets structure Goldman our lease with that C&I cash the feel we new and improves program referential plan very be In conclusion, term, our construction for confident we are at notice a meet unchanged. with minimizing month. proceed will will detailed Capital flow our Power long-term on a Renewable shortly projects track improve ability remains flow fund sales near-term for In our finalizing that risks. that forward example, we enable to in Also XXXX for capital-light we our to near economics. partnering focus remain in certain For while our Sachs Day last model lease

further road achieve as backlog execution revenue the we our their our high-growth new half NGT Also, units and discipline X significant offerings. digital the our of SPS as performance I business business. turn initiative, a guidance. on SPT map Continued to product the along that, second visibility initiative ramp our with in and the current Maxeon well driven flow call cash and technology This second our position to generation in storage DG our strategy to investment revenue costs as build-out expect lower higher our by efficiency Tom? enable expense in management continued to as well will our strong for be certainty improve our With technology offering, half and XXXX. back of margin service including positive our Tom continued will

Tom Werner

Thanks, Manu.

to company's to half minus a to performance on our safe $X than follows: bookings, SPT and company well we $XXX expect to residential operational adjusted for a and margin range quarter would to to XXXX, as $X capital the year XX%, on of million basis XXXX to year quarter a X.X in non-GAAP expenditures The be in $X.X Megawatts $X XX follows. non-GAAP billion approximately XXX and year second towards seasonal the billion million, EBITDA megawatts financial million. expenses of our of harbor the fiscal in approximately $X.X a to the million $XXX to improving fiscal billion of XX. For year megawatts company's the to basis GAAP is million. $XX deployed performance guidance fiscal of million excluding million, a to XXXX. The range XXX income million a weighted gigawatts, million improve business. GAAP and $XX and of gross given as with as GAAP $XXX quarterly plus throughout company's of in now I of commercial of guidance to discuss expected is second X% revenue the X.X a for X% less $XXX patterns $XX program of non-GAAP revenue backlog deployed like second to our on non-GAAP basis, XXXX million is Please margin basis. X% basis turn expects On as $X.X XXX slides gross to On and guidance of billion revenue megawatts. $XXX of

a With summary, I for the is be would executed Finally, positioned $XX for for company as its half initiatives the on questions. the we million. adjusted second to to strong the company that, EBITDA and quarter our XXXX strategic QX of call performance. the In like year raising profitable was fiscal and over turn in $XXX range million to company solid

Operator

with first come [Operator will sir. from Suisse. Instructions] And Credit you, Thank Weinstein our question Michael

now is line Your open.

Michael Weinstein

guys. Hi,

yes, the -- business higher So on implied for for growth that that the EBITDA. error regard if guidance expect that you line prior you thank or the possibly is slower -- And that can With thinking? the of market. XXXX to for guidance shipment driving is growing XX% the wondering whole said residential the clarify business what that in I'm thinking was just what than you

Tom Werner

the in The is we because think number weather by delivered And a confident business. of California our because wasn't of almost that, our of XX,XXX approach of growth us taken of consistent of QX of them we've in looked this Michael the Having quite we're I said because that have we Tom. residential as Most particularly forward, greater in our comment. business significantly a lease we new also that's percentage number peers percentage California. that and all most So, are as your influenced and homes new that's with homes. than

two into we're course, quarter. months Of the

weren't it's have some structures the -- new So us on that the to importantly on. were allow quarter's more previously. aggressively that we on we lease it's based going in And also how than fact previously states based that that's and we enter

California of our quite beyond. of course we're we're QX and combination that strong in and So quite and quarter-to-date weather had lease a improved actuals where confident in we've new in growth

Michael Weinstein

the are as When in the you into then quarter, you trends future? question talk the you And expect also go going. storage. the storage versus out suppliers rates are who forward there? do to change of seeing the you're suppliers battery battery battery Maybe see where on other that one about commercial And mix Great. residential could attachment you

Tom Werner

X have So, are storage of in and is opportunities. commercial. mix, commercial to terms important more it's SunPower that note systems in number bigger And

rate I elimination first mentioned I would our software we're in confident And fact, that, first our for in offering this by offered we as we hours my we internal So And to in and to integrated in. we year. demand vertical exceed add will -- charge And interfaces plans the prepared XX-megawatt deliver C&I this that business. remarks, have commercial. that,

business, from XX%. something And on the our in Equinox. know So, doing storage. just north And are alpha of attach we're directionally shipping a we're I And you storage. product. And we'll similar. Helix taking towards maybe experience is be is, residential called of We're as the think rates certainly we're XX%. -- the Equinox And doing In offering complete this improving we'll residential starting offer fall. that what

In the in terms X% XX%. and rates, we're attach of between single-digits

that other offering. we And dramatically expect Equinox. to offering our be it's to I to raise parts We think that that, SunPower. own is by offered increase It important note of will similar as

one-stop have you shopping. So

have to issues have you company been obviously the that's any If warranty incredibly that's BOS one And popular rep. relevant previously. Microinverters and and you to with talk to

storage expect with well. And we as that so

they In are you suppliers, terms who of battery would expect.

see are Chinese yet by of this supply I otherwise. -- I Chinese that forward, think commercial. think, Lockheed Tesla, say next year big LG expect to guys then that's meaningfully, certainly their though is when the on is that partner What the what good of into cells, would use you -- obviously integrated ours that you're even though and there's see a going like battery integrators or systems year. in going make of introduction I either we'll we'll cells see to are going who And

Michael Weinstein

Great, much. thank very you

Tom Werner

Michael. Thanks,

Operator

will with the our next Lee Brian come of Goldman Thank Sachs. you. from And question line

now line Your open. is

Brian Lee

questions. my guys. Hey had two. taking I just Thanks for

in go I and on If even for megawatts imply look it was deployed megawatts down at XQ, levels. flatter one First to then guidance. from guidance the are seems to volumes that the QX, the going QX

capacity given isn't more something or back there? of half missing maybe the of why I'm the wondering, there expansion the So growth in some year

Tom Werner

going with So on when volume, you overall a look at lot our mix. there's

And expect SPT that out Our in dominate, the in P-Series typical of the that company volume pattern our can can lot joint change a pattern. that the that overall you'd venture. business of has comes

comments looked at QX throughout you with growth business, earlier. SPES guidance If it's a consistent QX our significant our to and

Manu Sial

Yeah.

megawatts only thing to So year, in Brian, we half XXX about is, add I'd sales of the the the being directed have external back safe from the harbor.

for normalize to So, the you that. have megawatts

guidance the So, the megawatts, you and in. XXX take add half take first megawatts range

normal second You half first half a the year. in growing will half SPES see in back especially of the

Brian Lee

take the in Just homes -- of volume But I'll data. you on California maybe then of try a delta that Yes, say you that terms is question the new town we more cadence the XX,XXX Well, how that in Maybe California? sort when customers there. of that's of enough. spend sort to around a quantify But second homes fair expect that granularity when wondering you helpful. should new And just general. and offline backlog, multiyear what Okay, -- I know in some mentioned can of is much of P&L. backlog? get the

Tom Werner

questions your year. lead homes a top answer reiterate in are XX% have XX to one XX we XX% And with just to California the of California. homebuilders and new new here the commanding and in So,

as one obviously So we but that would think expect year. it increase to a number rolling of

Brian Lee

Okay.

know market different XX,XXX customers imply the in if or right new have given there's kind I in of just there? you But maybe homes the close to pretty I follow-up. California. XX,XXX solar would California that a XX% XX% out share there. Is estimates the quick of that the midpoint read -- So, take about

Tom Werner

Yes. the answer's make and check said. Yes. close and you what really it's to sure. close pretty yes The But math we'll certainly

Brian Lee

All right. guys. Thanks

Tom Werner

Thanks Brian.

Operator

Merrill America the Julien Thank of Bank come Lynch. you. And of next question our will from Dumoulin-Smith line of

open. now is line Your

Julien Dumoulin-Smith

Hey good afternoon guys.

Tom Werner

Hey.

Julien Dumoulin-Smith

more the XXXX evaluating time. alternative in might to talk beyond little about stockpiling financing at on here bit strategy the a goes elaborate bit to might Just this safe thinking be on have your you it -- point you're or as possible little arrangements bucketing you how depends as And harboring it about the technology? a and more able your here. Could perhaps extent on Hey. elaborate that the

Tom Werner

I'll Sure. harbor the comment take the let on numbers and financing. safe then Manu

be to the started it's and and technologies what end we our megawatts more a The be mostly year. the won't the all mainstream XXX It the technology will of it of to safe technologies but combination of continue So, will small harbor we safe A-Series by IDC or we be part NGT. what percentage. EX safe be various will that IDC so it run a will harbor, harboring

past as So, it'll IDC. and the all a month be you of were XXXX our think, half, end comments the what code. provision exclusively think three And this of there's will safe a through harbor then in I year

our So, the include through quarter obviously, safe into first first Well, harboring for the goes next so goes year. the quarter next of first the XXXX of year, quarter. it comments

have XXXX what you're to not commit for a little XXXX for use and us safe that's we early have a for years it's to We with asking. harbor plan what it's -- in or But We at that's do guidance. harbor safe given would subsequent comparable for least if that.

In financing Manu? terms of

Manu Sial

Yes.

just in have structure, the and Day. So, will utilize process financing terms minimal capital structure Analyst the like said we in SunPower of the

with We the past done deals several are with years. partners who our currently financing over several we've in discussions

well. closing beyond safe think the same And can in of harbor for second as XXXX. XXXX we targeting We utilize half it are the we structure

Tom Werner

lot technology So have well. Julien and of business there's with with are they harbor. that done counterparties experience number a really They know us with the they've safe us quite a of because comfortable

few I can we're advantage. forward this think done been winning here get a And next near think distinct that's because the months. the we in term in so And I

Julien Dumoulin-Smith

of And financing, you in safe ability future safe that And sort as here, of harbor? XX% to whether later come up you're of if this megawatts the your commit same back as the clarify XX% is could you signing panel Or XXX to sort equation in and And if "I'm are a disproportion or backlog harbor quickly, XX side to then duration periods the a for on related, seeing going real in you're to on and I'm customers XX are see here, step benefit of what remaining orders now harboring the the I the say you just could you follow. clarify the panels"? going seeing to you this your you that extent safe give to to mind? also of ideal

Tom Werner

part? So first the

Manu Sial

to step ability up. The

Tom Werner

Sorry. Thank you.

our we've at Markets Capital I Day our XXX megawatts. least today in and -- So comments in both yes said purposely

integrated our So your precision second question is a is expect that May, is in that time, It relative unlikely the starting It's we in highly but how options. be years. because of to It's give and to can to product opportunity is differentiated would at your answer we're year the over in also And it's harbor is part other of the a for devalued there question the have in out control to much an -- preferential. first more. I vertical yes, in yes. think demand more. to to because partial early early be we little an safe we'll have certainly opportunity least It for the because number opportunity part your to

stages early the year. that early but seeing of it's in we're So

Julien Dumoulin-Smith

very I'll leave Well, it Thank right. All you much. there.

Tom Werner

Julien. Thanks

Operator

Colin our of Thank the come you. from Rusch And Oppenheimer. next with question line will

Your line is now open.

Colin Rusch

so Thanks much guys.

ramping the savings A that incremental As Series what's you're previously? technology, finding you here? expecting weren't for some you you And areas any surprising are cost

Tom Werner

throughput lines we point more next-generation The road I huge plan. could there classic our more technology that surprising are coming us that would is than better question. is watt A-Series our the actually on obviously map is the could have for And semiconductor improvements confidence of you on. also it's basis we fund in suppliers a costs product, to in that for the positive. cost as used And thank capital, sort thing what's the So more be CapEx the per other improvement positive be of of lower

and improvement on just greater go on to a will that summer, Analyst least as of be that's through I at NGT we've And in funding the Day we said CapEx we'll So better. as said. clarity course we what probably for fast of some as able see give influence our and

Colin Rusch

concerned of forward? with And just Or communication customers that in you've we think the point? this How solved solution going how Okay. that about and and conversations already something terms put out security to in battery solutions, that's yet? is bed? coming the should something sales then Is are at this

Tom Werner

The one this own have a we're hasn't else. a I because our And on yet good it's a is is We're answer where it big -- think and someone it -- for. advantage variable question asking we is an preparing been not that software.

is the of as I an think lines buying install plus the in we're to software. decision XX-megawatt of But So add doing, pipeline, And improving learning important you XXX variable it's been that we'll yet. we not install with more along and what what features course, hours we're suggest.

Colin Rusch

Great. much, guys. Thanks so

Tom Werner

Colin. Thanks,

Operator

Thank question come from And will our you. James. Raymond Pavel of Molchanov the with line next

now is line Your open.

Pavel Molchanov

PV Thanks been for think referenced that stable well. taking how you pricing module unusually can ASP confirmed that the the press module long data last? do fact since release, the landscape the question. has benchmark attribute you November? the stable insight and by And In that's do as you What

Tom Werner

countries strong mostly mixed a signals is good. lot positive. On there's big the quite a And -- Europe so we very in demand. new China's we're variable Far but China, world seeing has of think been it's demand and East. in

Harbor, combination course, the In throughout we half have then, -- Harbor. or drive But look year. stable And, I of this being So of to towards -- financial doing very of are There's just markets already that when year. see things I we'll to being of increasingly And forward the again, year. lot If We of a world there's good. Harbor, America the integrated. and at incentive that. environment Safe back not rest increasing think Safe the year. with demand Safe we're from modules vertically And strong believe we're you pricing benefit this preplanned get going a in this the world we environment. this demand this

Pavel Molchanov

of expect on Okay. battery percentage residential And end by this include up new you year? What the then maybe following to that. of storage do builds

Tom Werner

Yeah.

approximate. we'd question those to answer the -- is XX in on -- going next So to your year call XX

Pavel Molchanov

Okay. Within your own business mix?

Tom Werner

there's upside that storage think -- C&I learning work some we're I there solution storage our the of given out bring doing our we Unless the business. in with Yeah. storage Yes.

Pavel Molchanov

you. Very Okay. clear. Thank

Tom Werner

right. All

think I and have wrap I'll two or more going one we're -- more up. to questions

Operator

Okay.

question of will the from line next with Sutton Barclays. Our Moses come

line Your is open. now

Moses Sutton

leaseback adjusted any the detail you What get Thanks commercial might be additional $XX taking the question. sale included now for might in monetization this once closes? Can million? for impacted on that provide EBITDA

Manu Sial

or the EBITDA? question cash on Is

Moses Sutton

be would fine. Either,

Manu Sial

numbers non-GAAP from gain, an included included our is So, not perspective, EBITDA it's in numbers. in that perspective. our GAAP the from It

$XXX it said quarter single be to than greater getting is In second in we've cash and And been got second high the in of digits money forma our terms first as of remarks, my quarter quarter. going have quarter first as rest the therefore, I million. ifyou of we're cash, balance part in prepared would pro

Tom Werner

we a expect structure it in As does cash-based P&L. you our to think actually potentially that going makes way And cash-based that the to point I'd favorable it model apparent of and place. is it but forward structures be that it's I'm with we're out which putting because what P&L sure easier P&L

Moses Sutton

is Or by lease to would quarter, have going long-term here, anything And just $XX increase million is to that leaseback the color the to you debt Got Any monetization fourth related deconsolidated? it. be be with it ready similar debt? commercial from helpful. the what

Manu Sial

Yes.

the portfolio just up at shows not related to from sale-leaseback other that think actually I line. commercial it's – no,

Moses Sutton

it. Thanks. Got

Tom Werner

Okay. Last question please.

Operator

Katter you. from come Thank with question of our And last the Baird. will line David

open. Your line is now

David Katter

Hi, guys.

on just one provide that Just number million the for of from an Can end there. update million? walk of $XXX help -- from year us Just the $XXX Day Analyst it, touched pro me. a quick to cash forma you

Manu Sial

Okay.

we think than year being call balance cash $XXX our Day about ending greater I talked million. Analyst the So in

our think fact the better continued the coming our of businesses that going than cash in in fact confidence with anticipated. are half that back I in are and the generate transactions of year we the had materially the to some

the the to You'll quoted be number $XXX in see greater of million than well mark. tailwinds to -- Analyst we the north Day

David Katter

Great. guys. Thank you

Tom Werner

call Thank business performing significantly right. our is everybody it. you We to better. We appreciate All call. much as joining look next our forward for our

you So again. thank

Operator

participation and wonderful conclude This may we you Everybody Ladies a disconnect. gentlemen, thank day. on and our program today's all have conference. for does your

Sunpower (SPWRQ) 9 May 192019 Q1 Earnings call transcript