SPWR - Earnings call transcript Q4 2020

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Operator

Good afternoon. Welcome to SunPower Corporation's Fourth Quarter 2020 Earnings Call. At this time all participants lines are in a listen-only mode. After the speaker presentation there will be a question-and-answer session. [Operator Instructions] I would now like to turn the call over to Mr. of at President Corporation. Vice Okunski, Investor SunPower Relations Bob Thank you, sir.

begin. may You

Bob Okunski

I Thank XXXX welcome everyone Earnings like to to Call. you. would our Conference fourth quarter

On who Werner, before back CEO a SunPower, followed financial off quarter we'll results Sial, turning XXXX our of the over our fourth Manu for of XXXX CFO and Tom call summary guidance. review to the with from performance by call today, will the strategic Tom start quarter

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

information statements. make During and today's the forward-looking appropriate call, statements today's our Form during the XX-Q. quarterly non-GAAP Today's earnings for well Presentation those subject affect we uncertainties presentation. factors non-GAAP described Also today's will to reconciliations. and GAAP call, as we various those appendix reports please in additional may on that metrics for reference press the of refer are see press to release certain forward-looking our today's risks that these to Please release, XX-K are regarding XXXX documents slide of Harbor earnings Safe that will as our

of the Finally, like Events SunPower. turn posted data of this detailing sheet we to metrics. over posted Werner, to supplemental that, have site. PowerPoint of Web a the reference same location, I'd also we Presentation In have additional enhance historical to Tom? our will slides page With call CEO call a this we and set which the call during on Investor Relations Tom

Tom Werner

of as individual a segments. brief we performance, this well update on will for for was you thank our joining a Bob, Thanks, On us. XXXX year as call, provide quarter overview SunPower. fourth transformational our business an and

priorities, the strategic position As for XXXX in beyond. of to company and success a number we completed

we remained bringing this our turn sequentially well installed improved strategy base saw that megawatts as Slide to three. XX% across demand more confident are rose focus growth. as XX% QX, Please Unit gross positions watt more rose In XXX,XXX. customers our residential businesses. quarter-over-quarter. adding economics both and healthy, customer as to long-term, growth, for split Commercial margin per profitable successful XX,XXX approximately following than a Maxeon strong We us than

we our our sheet, our cost delevered significantly Additionally, also also achieving while debt our lowering net capital. ahead Day balance of target forecast, Analysts of

We than to net strengthened our further ratio our XXXX balance EBITDA debt tender also our X.Xx. through and less sheet successful to convert reduced

the homes the the accelerate solar, solar as and as EBITDA rapidly. set of Finally, The California strong is change. of factors, businesses growth These top-end years extension new climate an increasing industry integral Slide in as adjusted we growing exceeded the ITC, the the our outages great driven and recent more over tailwinds. well as others U.S. is to part a acceptance are the energy, combating by market solar residential of well affordable five next as guidance. continued of to Consumers of seek four. the shutdowns. net income cleaner turn and resiliency GAAP both increased mandate Please face driving affordability post of broader more

backlog. expect over years market We XX% few given homes exceed growth our and next to new the share our leading strong rate

several see outages. storage resiliency commercial and The markets. fires the continues to As and the we next storage shut-offs rise storms over blackouts power customers improved years demand rapid challenge adoption to both increase in and to economics rolling grid and offers expect and residential

cost. advantage their give DG services, future a a more customers energy and services opportunity of platform us in of see of buildings our distinct we in our believe We and significant digital the solutions and control electrification transportation. investments seamless storage, giving will offering Finally, in integration energy use broad

industry long strong our discussed, leader to $XX next drive addressable the five. we see expect Please to market. in storage long-term SunPower's expansion the to XX turn tailwinds of Slide the opportunity market to panel addition billion solar grow significant over growth I we which just the through to In generation market, and distributed years.

XXXX we expand areas to look see we and As key serve. we beyond, markets three the to

Helix for First, in segment, the capitalize continued front to on through increasing meter demand storage investment solutions of the C&I platform. our Storage

homes that developing and and storage services monitor from to in use electric control energy new customers take we're of digital and vehicles. solar Second, enable their

from solar our priorities leading like software Slide of discuss please for one of platform use product six. year, now our capture to extend and power marketing the the business to will we this installers. turn industry tail I'd Finally, long three to incremental to financial offerings top

our plan execute drive year-over-year. momentum growth exceed expect rapid exiting XXXX, XX% growth revenue we is to our expect growth overall residential, for to growth, expansion to revenue In we which of homes on XXXX First driven XX% strong storage XX% deliver by the to new growth at In per segment, a C&I margin accelerating we behind as improvement sales. gross our our we through expand in efforts. community channel solar least TAM the and revenue in XX% watt meter with direct expect of

to profitability Our margin through is improve expansion. second our priority

loan shift to As and improved sales we of year enables cash more in capital. last economics our product from discussed our finance people are ramping to in This solar lower rates attractive at more of storage straight in lease product due full we cost year, significantly impact at to strategic highly XXXX, improving Analysts see financing. adopt to addition Day a our

Given see these adjusted XXXX. and tripling in trends, growing than more EBITDA, we at in XXXX XX%

further We one screening for and offer additional segments longer existing home partner customer to to is as thoughtfully base. smart EV of services and leverage plan to to new customers, investing a and as to to well reach Our to innovation third extend capital our power growth. wider its term priority in deploy platform

address front segment, in of and our market software the the Helix expand the fast to meter a within C&I as demand. Additionally, industry we service platform growing will participate

to corporate to expect continuing to are We turn individual and progress the ESG I'd on Slide of into our shift segments. our making significant spring. We're front sustainability performance report seven. this XXXX release efforts our to also Please now further to our strategy. integrate business like this

Our momentum segment built residential to business. as commercial this in and light outperform continued

addition or strong QX. to from XX% and margins megawatt record to In accounting. growth, these XX% adopting in gross based rose are And sequential since cash

between mix sales overall remained cash and stable quarter. lease the Our loan for relatively

to as TCU expected can include our shift system sales. and efforts our starting initiatives. successful expansion, However, a These improving in well as sales our financed over to full place versus more of lease financing programs economics cash we for long-term QX, cash number highly loan put in partnership their while of with time mix They're which customers. new expanding drive and both equivalent

rose value residential in We are to see already per watt in to in QX, $X.XX from quarter $X.XX this starting bit. more on the as creation a this

XX% resulting performed megawatts New quarterly grew more backlog than a well megawatts. with bookings strong XXX as sequential of record in than more homes also

Our market share one products remains interest about builder and many our significant our XX% of partners. in roof for with SunVault

uniquely are efficiency, very bullish about serve the of completely the are foundation future services. drive we customer our for solution. needs, build solution, Finally, future we revenue and high storage storage to our integrated positioned SunVault With

strong installed sales the from XXX,XXX benefit to our new also base. only not to expect customer customers, through but We

of we attach in and XX%. the For continued ramp the our channel dealer saw quarter, rates consistent sales

solution, XX% strong We in per kilowatt hour our above revenue average. incremental sale raising SunVault larger XX on the interest also saw

are at On and a services, we in improvements to residential Capital improve more capital. structures As providing to Slide this SunVault XXXX We as can chain expect we lower we XXXX. which highlighted storage million our to contribute confident, our our eight, look financing creation to revenue Markets per goal. as supply Day, we from economics, $XXX look in our meet our installed, expect which margin go cost detailed residential at remain continue can in of value at we through watt come or unit

we we economics. mix of into our As to system finance XXXX more beyond, finance residential systems shift our improves cash versus unit continue and to which towards look expect

for the offered residential financed our of driven cost expect about to the primarily two thirds phones leases. demand priced attractively of systems and QX through lower program be We by XXXX our TCU by growing end

that long-term We continue customers. result and our partners tools invest dealer in to digital for in benefits

we have some the future, In robust some and digital platform Over marketing solutions to dealer of leading by lower with years, elements plan customers. of helped have very our extending that to dealers this the monetize cost. built at platform a several we generate operations the past long-tail incrementally sales more digital the

watt. Excluding these QX was residential per OpEx our digital $X.XX investments,

Slide on C&I to on nine. Moving

well business. Our and for prospects segment about performed this also C&I growth we our excited solution remain

years. few execution, than community to margin XX to installs in of posted we quarter, $X.XX to solar increased deploy billion pipeline the record storage For improved by than X $X adjusted solid our of EBITDA, watt per megawatts structure. more cost the and driven and over positioned next ourselves added more rose million Gross

the watt to rates landscape Long-term, year. believe about margin Also, XXXX. QX high increase for are front behind as more C&I space. looking C&I evolve to projects in evolving turn the and Please from to storage capitalize are demand the as we XX%, well Storage rapidly positioned as XX offerings hours attach gross well more The integrate to continues remains Helix expect on to the landscape per while to XX% We meter. in were installing of XX% XX. megawatt another for in Slide we as

in capitalize the trend, given leading to We are on base industry positioned solar and well solutions. installed our experience storage this

three focused on significantly us our that enable C&I expand initiatives TAM. are We strategic will to

serve foundation market, while the origination given to continue meter of front strong behind meter the for experience. First, our the development and laying offerings

addressable $X our our billion to experience of in expanding forward. additional our C&I relationships turn market. add to our going Second, leading CFO solar pipeline opportunity Sial, Helix to that, to technology to and remain Manu we And platform and storage like further the both excited I'd base. the leverage call Overall, in third, our over on and about build With partner expand SunPower. very functionality customer industry by

Manu Sial

turn Please consolidated financial Slide results there we Tom. metrics. select to Thanks, provided XX, and our

performance EBITDA pleased income we our GAAP are our exceeded guidance. adjusted net financial fourth for the quarter as We with and

debt. generated significantly recourse reduced units Our business is cash and

quarter. commercial XX% saw third Moving was A more on the quarter. the We C&I both recognized, and solution sequentially. approximately rose of XX% than segment light performance our to sequentially continued in overall up segment, to up and megawatts specifics our compared also with segments residential XX% the

through at expect continue least initiatives cost lease per watt volume quarter XX% per with in a watt residential per at OpEx $X.XX as our and residential $X.XX gross $X.XX scale. benefited was and expect margin strong in in and trend loan margin quarter. improvements sequentially quarter in economics in Consolidated non-GAAP We watt in watt accelerate per Devco in third from from We watt $X.XX per initiatives. up fourth XXXX. per to we've our benefit gross to improvements XX% Non-GAAP these in XXXX seen the residential the of quarter from down fourth

deployment see exclude investments If products, capital for which $X.XX digital you was in as we than per watt. what OpEx OpEx; our and more

As mentioned, improve and are business watt to created Tom SunPower. had per enhance for to value in in residential fourth economics value residential we driving creation initiatives increase 'XX and project mix significantly quarter $X.XX

very second into stronger a We our compared have XXXX, EBITDA first while with our a going business strong rate run to quarter half performance fourth half. is seasonal

We in linearity. to significant have done improving work XXXX

'XX linear, expect longer given for cycle C&I a our be both quarter though less times. project first We will businesses profitable its

retained services $XXX at through of that was include metrics revenue Day with Powerco quarter, us our Our the achieving that earlier, that sets transparency to margin us we are well laid investors, only services SunPower are incremental residential future management pipelines Markets XXXX but revenue mentioned leases. The the traction to not in in tracking digital system, out end fourth with Tom storage in now in giving of streams. to share well net confidence improve at from along revenues Also, build disclosing targets. sequentially investments out up million order and Capital recurring asset for and add we value

value million forecast. ahead was the $XXX and our For of net quarter, retained

earnings look X% mentioned our balance our forward. we cost sheet, to capital our the from committed are as last the increase of strength and as well call, project in increasing current of lowering to share we economics Given going residential

ahead reduced net Finally, ended materially fourth by for XXXX with driven targets. converts quarter Day significant of Capital we strength generation our business unit tender our offer Markets cash with in a debt successful and balance sheet

generation from XXXX. through cash business continued expect units We our

customer initiatives base. for our to in expanding call to balance total Tom? model, reach our to software and services strength partner Given to expect invest beyond, and turn XXXX in while cash platform build With our will we wider a Tom guidance. sheet and out further digital addressable the our expand and that, enable our to market back future strategy I

Tom Werner

XXXX to of revenue XXX and turn Please $XXX megawatt net as to million, million fiscal The guidance to to XXX. quarter $XX company's $XXX first and GAAP million Manu. $XX GAAP year is Slide million follows: XX. of quarter first Thanks loss recognized

As to non-GAAP We of we be stated $XX to million. profitable every in adjusted see the first in our quarter XXXX. we Capital $XX million expect quarter Day, range in EBITDA Markets

For at year, adjusted into expect now growth XX% at indications megawatts a our Day EBITDA of in Markets the business growth fiscal at our approximately and coming see better Day. year. previous recognized XXXX year XXXX, XX% given our than Capital confidence of our last than forecasted to stronger the revenue Company Capital performance we expects GAAP Markets or we approximately

a are the QX for that residential success beyond. policy XXXX continued well positioned the over revenue and than adjusted and XX% for to was commercial support, With tailwind, EBITDA call and like as for confident company and growth questions. expects demand its in would In for company The increasing summary, industry strong of quarter given Finally, XXXX. more as remain solid we solutions. to storage federal that, turn well I we

Operator

question first Brian from Our of line Lee Sachs. Goldman Instructions] the comes [Operator from

Brian Lee

going But it I versus as solid a raising the X, stay, margin here. on doing would EBITDA gross do the still the and intact, just had like Capital you're something to Slide says try the than first versus going the 'XX something EBITDA square year-end. I XXXX. view not guidance, you Kudos million. capital 'XX I know, wanted the quarter higher, that guess margin up. gross Maybe to But and talked view to if revenue are XX% sound they're guys you on market well. in better on view about like implies a assume in Xx given greater $XXX even revenue margin Markets that's at Day, I

adjusted the margin kind wouldn't the there? EBITDA given up, that that square than the be why you So is on of or that view can better changing margin growth XX% target something

Tom Werner

So I'll It let up. say will a few I comment. square words Manu and should

the we question. So appreciate

As late got expansion. in cash you the we credit investment really know, year

XXXX. positive sort But was we got it so step impact of And the then the extended. of in down

it's So to being the better. both our give a XXXX. the there's thinking is to gave in and extension strength of not XXXX the that sign We're impact of business. color revenue or favorable And in confidence actually on of earnings but us same

and In the want do terms of you as comparison of Manu, margin EBITDA a percentage of comment? sales, to

Manu Sial

Yes.

to our growth think the Brian, implied our at guidance way think, growth Markets revenue both I about Day. it and than megawatts Capital better the is is

gross stronger in is Our the also residential business. margin specifically

should better should call stronger from rate metrics derive the up that the margin gross the be in So back. clean Markets that a We and the what EBITDA than Day Capital into can performance. translate specifics you

Tom Werner

we extension. do XXXX OpEx I we If level Yes. is that the note, have incremental because add for of some normally investment there ITC

for effort little little RLC the incremental from impact some so community investment XXXX, going bit and a of marketing channel there's of our there's in solar of the a bit into So that.

Brian Lee

offline were a kind the all? I'll future that you could Lennar a kind enough. that anything in any that square pioneering talk the the Lennar with question, respect do after And of have you visibility exclusive it of all? of midst you opportunity at California, in pandemic, with fair partners this. your in see Or working that at bit the to opportunity more leading about arrangement just has Sonova similar announcement you your just to up the of The very obviously pass Okay, numbers. in been vertical. new today, builder the 'XX And to contemplated wondering, that with have guys for And sort in you something second Can you impacted in point? homes as any of terms home that channel take at ongoing relationships? on effect here I'll of just then,

Tom Werner

over question. the going I'm and start a to then, to answer things. this to few hand I'll just And Norm it

specifics the visibility And in let have but long-term Norm we inherent It's First, visibility channel. that we great. XX from XX I'll like benefit business transaction. such the for do relationships with do Hats is Lennar and that business did, any Sonova builders top of years in their XX today. We or give But to terms there. inception ago. with we to not off them, XX no is there

XX with of And to will business on exclusivity no of turn top visibility. lost. I So Norm and XX any there's in for specifics builders, comments terms

Norm Taffe

the one mentioned, echo that's have Lennar. just Thanks, what of in course, top said of Tom Tom we -- the not well, to XX Yes, Yes. has XX XX, two Tom. the builders, of been as

we at done it have we all. impact business our So don't not business, expect to

is In business we're growing we homes record, up QX at homes, seasonally on we indicated for this at is have set what clip, quarter weaker And new fact, we new interestingly, very bookings is a a quarter bookings a our terrific to expect now, backlog. record. unusual record which end a usually pace actually in in right

So the us. business, XX-year strength and that relationships business This product exclusive is is execution confident as that business. are with much has well absolutely SunPower don't arrangements as is think, very and execute. dealers, accelerating our our the that with I deliver an been who in sales going builders top to installation, with frankly, We have on-time

high And we the we've panels interested we quite relationships. And love up SunVault in roof. fact have less built so They those and adopting per we've for because very they're so efficiency solar. always now need been very also successful, storage panels,

it new in visibility XXXX. to the business, expect in bullish it to outgrow have our So business we remain homes very, and overall very excellent

Operator

Thank you.

Suisse. comes from line question of Michael Credit from the next Weinstein Our

Michael Weinstein

EBITDA in capital In assuming what you cost your profit rates were discount or growth watt? are least per SunStrong's XXXX, for assumptions your at profit regarding of value

Tom Werner

Okay. you Manu, it. Manu, go to add to maybe straight want there. to more clarity a little do

Manu Sial

Yes, sure.

we capital residential Michael, for cost of in from 'XX our So, our X% as have cost leases, of for improvement question loans communicated last cost going a then we specifically our to slight call, and capital 'XX. in our earnings as your regarding SunStrong of capital the is well, answering favorable in

margin cost both of and finance 'XX should think the That you between the greater improving favorably products capital and that 'XX. that you impact as see -- for bear will financing for across assumptions loans also our well products, I mix leases equipment and of us going gives between think XX% EBITDA on XXXX. about than modeling and sales confidence increasing and into

Tom Werner

Michael, let on. me add

on the necessarily mute froze cost what brain, driven cost which not significant a our going set partners not pause XXXX it's performance improved do. further we've But to unfroze. with a actual of The to and -- leases and exists. my and not pull but some friction rates it's is out is variable. significant by But of capital and loans, redundancies variable it our Your working into friction, still by

Michael Weinstein

any labor backlog new the if of And especially just are China demand? I home XXX on Maxeon just curious a issues question, module there out constraints demand, seeing there. the more on of megawatts but are given any you kind constraints it, guess of it's

Tom Werner

Malaysia that's of made cells are in and make shape. our now. that most that the the Philippines we're of assembled will in made relationship work we the -- advantages And And modules have. are Mexico. I I in or one remember Yes. either solar And good of quick answers on

Michael Weinstein

a I for seeing, modules? guess, China demand I mean, non-western you're not growing

Tom Werner

on them and to cover that get an when unfold. that element There probably talk us that see. I actually you're more but so on is impact minimal of you

Operator

of comes Ben Our from Kallo line question Baird. next from the

Ben Kallo

on up last how I I up and the then investment, of And if year, then, back investment we see this digital into So line? you it is And apologize follow a just and I And then product said on this throughout that as a something have we should that view bigger should on year think stretching issue. recurring? about this. much

Tom Werner

probably it. a little color Okay, Ben. I'll give on

of say something we spend. Manu more I want expected of Yes, efficient. recurring, in and to as think terms may it's to well, the Norm but amount become

could just some commissioning customer evolved. color. system to revenue and here lower more the the made from well of we five that's So extensive dealer goes sense to we years, you That investment a we've monitoring tools, probably percentage And the then, of give they in of of want and and else of it's of obviously, solar digital, like tools we you want back app storage it as whatever think of as and and an that have. take of scale system, four investment some think give when think or cover. Maybe Norm, course

Norm Taffe

grow, percentage you we forward consistent As can I product think the makes core tools, a see are the what down, digital solutions. well go will our in we think as us said, which investment then to as basis different going there, be as we

that So, those overall. obviously, emphasize offer SunVault and loan of and but products, of just our broader lot that digital provide the also allows things the dealer channel us tools, a use. complete our into lease really they're tools complete can to to important to dealers it's and enable customers key one the But the marketplace solutions not our solutions, our

Ben Kallo

that maybe that say you us your because that you of little your economics that question, because upon loan going Manu, the think if maybe lease And will heard maybe you follow matters, guys. of bit. to more Thank stock of I a balance possibly and just My the price. could expand guys I And Great. up and of tell you, take you're forward. going sheet,

Manu Sial

Yes.

think what can talk you talks years that the are improving economics the think leases I our is, sales profitability value but and customer loans, the I to for think compare through cash creation, with our that see you on way to best value anything? So, creating you'll is, we also look just page. in that SunPower. mix the eight, see the if for Slide equipment through if the And at two improving the you our residential about I will greater that our seeing you inherent value impact between the value product, add finance And creating to greater Norm, that allows from would systems. like and between creation more maybe mix coming

Norm Taffe

No.

coming the lease are the the and QX of economics as say just main Really as improvement think main and still much full is really it driving fact based driver, cost we And capital better economics, the perspective. I our really better its loan that lease I driver is have and of down. that and impacted both from -- for foundation would for better a getting is year cost a -- is but our is XXXX. cash loan better because of our much

Ben Kallo

your So sheets some sheet it's on assets of not your not on about balance se? the keeping versus per keeping balance

Manu Sial

me that, take Norm. Let

So, to the provide described, keep reducing different is to in a structures the in allows does us Ben, sheet the value what strong control. think One cost both is of project what And while maximum balance second things greater to and is flexibility our us. I two-fold. balance us I doing in And improve good is a share I sheet customers customer That's play our interest that for think does the allows it economics. capital. of

Operator

of Dumoulin-Smith from comes America. Julien Bank question next from of Our the line

Julien Dumoulin-Smith

prepared remarks. the just times on it the availability Listen, able the being to you well ramp of hear storage love as on really comment We'd to and about through given guys I'd about and in et more to channels guys made love emphasis also execute that Helix? several you meter little the hear on But here talked more a constraints bit front inventory cetera. the

Tom Werner

few on Potts, various We he Eric may words say to have and outstripping on demand elements as And meter. turn of then There's supply. well. I'll then few come a so front Norm. a do say great, back I'll is words

supply, Second, go we're let good. into I'll Norm detail.

that ramping and broad hire installation we're overview. Third it take sufficiently a labor, here. on is able Norm, sort of to we're retraining from

Norm Taffe

to. Yes, happy

still Tom ramp the upfront is in strong. phase. are demand But very, very We said, as

we closely don't that stuff call. limiting to the that supply right watching ability closely talked and see about the We we incremental of plans our managing $XXX revenue our are on and now this the very year hit million chain

of at of we back So goes. growth that, the did is year course, although we far as as still of plan most think half the that demand the

got we're sales Everything But supply is installing. strictly are as we our closely We've of now. just outside California California. Right organization. that now, watching as looks up attention it's chain the been of So right opened okay. our certainly far demand

SunVault. expect we or attack another of to then, sell be quarter actually actually be be importantly, sold customers. to in driver we ability installed growth. So either homes able base to it's it with release starting with the also QX, that Right installed we only starting will new And our installations, new second now, will our base. SunVault to retrofit But in

has been well So of excellent. far, the and itself from part extremely The the early the so received. ramp, but good. feedback dealers the product the customers is We're still at

Tom Werner

And like really with on front front to is because meter. synergies meter bit. of We to and the it few of the started strong it I software ago we And the Potts. little turn And I'll our Helix Eric words short, behind storage, quickly storage business three a just and years will now meter great. have say mention of a Eric working

Eric Potts

Thanks, Tom.

Our with development is origination slide market, and technology really as sizable. the to you front our platform TAM be meter us allows attack the the in saw Helix to which of able

XX We pipeline right have and plan which active building XXX on now, megawatt hours. we and growing of megawatt over about hours contract in XXXX under

our our to enable that competitively. us we area personnel an it's and feel quite like market enter software So where

Julien Dumoulin-Smith

excellent. Right,

elaborate talked you a exactly Just clarification month becomes last Just the on to guys target. How do go-to-market your guys strategy? about? quick you drive this XX%, XX do have couple here, the that on

Tom Werner

the loan with little say, The to and to market and there on And and lease. thing XX and to to I'm the turn question writing is a Norm we're bit. of going the is, it economics to actually then that one loan, I'm current is percent to turn dramatically, cash plus shifting next expand I'd Norm going improved loan have

Norm Taffe

you can see And we and so a give in you then, soon be area. customer announcements Yes. very can in even attractive other very, the coming tremendous hint, really we've versus even give those extension, any the more some loan. more economics our thing ITC, that's I there more moving with shifting Low is, volume. the very introduced The there'll that loans biggest toward of that certainly loan offerings alternative, past, APR momentum see

solution lease concerted stack to are you making the through us. working whole the the more products expand making reflects so It of started mid-last got our being better we're finance much with forward. use We But going our still for essentially growth products. more sure a it's finance that we attractive, and trend already. expect are year, better a our channel becoming our lease also for loan those more have for economics. it We're push portion market economics effort our of kind really platform that's into partners And to where also And and things make we dealer new dealer economical to more we the like attractive full to that market of also as capabilities homes, a to the continue. big get our and of

the also that in finance our already growth we've so, of the contributes business. And portion to

Operator

from Our Cowan comes the Osborne Jeff next from Company. of line question &

Jeff Osborne

I different the those? ISO them one business submitting Is you in those policy? balance retaining follow with just flush it on out owns the sheet customers? Are you actually who programs, of the into just corporate front had up and on, meter

Tom Werner

Can take Eric. that? you Sure,

Eric Potts

we're business say model. assessing I'd the still Yes.

primarily customer Our we contract the pipeline not right has mix owned it's It's approaches, SunPower a ones owned, now. have facility. a of under

Jeff Osborne

Is the in then, getting visibility or for year? booked for a the that through you're off you this but Tom, momentum fully guidance think And slow the it. to after to it wasn't strong can at the just like touch looks on sure how the point, it QX, about year? Got C&I QX, start the

Tom Werner

Yes. I appreciate that.

year. and really remember in don't best our actually ended exact our had for bookings quarter quite So here best probably booking the on of percentage XXXX a with and year year the I going into while. we looking a strong the the

the more Eric And turn projects last is we've -- seen since business, it's it I'm years. the So to projects. It's this more to of timing few profile that. going a for

though we're profile the economics are important ramp this Eric, got that the log? sort of present I a year. it's back with and mostly it's throughout even think So business comfortable sustained, we've of the

Eric Potts

XX% quarters been have then the now constructing And backlog XX% remaining projects. of it's a in awarded. three matter Roughly and signing and those

Operator

you. Thank

Our next Capital. ROTH line from Philip question comes from a Shen of

Philip Shen

some loan had follow the I ups product. on

sounds trend and going from your Sunlight, Loanpal conversation our about theirs, the with dealer what new And there Sunlight months of a Loanpal dealer is this and having you using I how have launch the for forward? to with So base your product forth. launched Can been you're and you about your to Some so loan and out offering and economics sticking percentage know that ago challenges there's suggests success. dealers to like some some similar. of comfortable it's while so talk are possibly our loan with guys relative and six then, expect a

a get mix So just to get the loan win the the business guys you product/ and dealer curious, do how base on of greater

Tom Werner

ahead that you directly? and Norm, take why don't go

Norm Taffe

of sure. for dealers half in Well, loan level. than more some our use Yes, our product

are. goes, credit unified of same service where to solving those platform. opportunity penetration and one, and the lot address that environment, significantly that of But choose do and problem want, And a provide more our addition the we that broadened them more a providing them. in options the it, our to to product be being is of dealer there very low of very, to entire off the improve TCU, they loan, can customers' et channel opportunity offer have better options sense which with giving digital of best cash our investment that's to more so part the with an we'll offering a share. And the it check we provide But of lease path really cetera, And able in that. it with loan, to which for in our has able be already whether also that loan. take of more and is offering that part the or we APR continuing to helped. a part customers, to is we've And customer of makes easy dealer having be the good channel to get good single really The

us the so But to to of more easier business. it financing and that's to just lease effort continue both do more a significant. and focus us easier share our on for making and and huge digital offering with it's And that to and business already products increase loan

of supplier our to significant a customer loans already base. are We

Philip Shen

your you originations Capital of by SunPower over be the in you what end help understand the really the the hitting of product you where Help if helpful Day at with and you're might percentage of like Thanks. good per Norm. loan understand, to perhaps you're watt. to still making us watt guys per is Can It dealers, goal about us in guys back and loan on of $X.XX talked track TCU you That's dealer half that. originations of 'XX. improvement $X.XX the or progress the are, sounds if your target Markets Great. that

NormTaffe

second We're along that the would the per our watt. take I TCU delivering of will our me has way, say let part percentage Now, business exceeded the ahead our that you incremental expectations. we're first. well margin tell on plan of I the

of can don't on don't I and just we're our I far we get number, top that dealers I would as dealer think anticipated know as say of incremental of I that I have top loan. will honestly, the along something. know that than so off. earlier make head of go that to just I the is using. the TAM next my percentage loan kind I don't number up raw I know, data, have first And that we your using follow want what get very what the But number to the that head. hit base very, one, delivering off in well my our off the we and you On probably that don't guess would year.

Philip Shen

Norm. for Thanks Okay.

follow Just here. up as another

update gave guys we back you lease you at goal? are guys the offering, you on And Thanks. Capital healthy have to can there? making the well? that relates on progress it Day. that Markets As Are as quick that a goal $X.XX per How watt of

Tom Werner

that. going say to is probably Yes, take he will Norm? I similar. very And think Right, Norm

Norm Taffe

we're once you great conservative And, improve We're were we're the little side time. little see your But for a making longer through to what longer flow bit there would Yes, sure. takes it impact pipeline, Similar to already lease garner. on progress. economics, in the because at cycle thing, we least, lease we a to of able QX, better lease again, say I much the relative a starting to economics. has

last course over has economics forecasted. and been the that lease was forecasting improvement were as improvement they that delivering what where as dramatic well of far our the Our of along which of versus we're most all year were, three we -- platforms

Tom Werner

two to lightning Okay. timeframe Appreciate we're it more it. and we We're going going to questioners to try take pseudo round. for everybody. Sure hit do

please. So next question,

Operator

Energy. Our comes Harrison of next question the Kashy line from from Simmons

Kashy Harrison

I'll quick. keep it

First of a should XX%, adjusted Manu, call million the flow how one XX and EBITDA about CFO to just it guidance XXXX? ratio we during for of operating cash relative us a generated EBITDA just on operating ratio cash under given million you wondering QX, think between flow of XX

Manu Sial

Yes.

higher of and our operating the two that point So is cash. numbers businesses EBITDA quarter. the business in these you C&I I the fourth the operating million one generated think I as to two businesses, of generated That percentage our fourth think quarter residential that $XX business, think cash, operating is, the about much of you about

from So cash capital operating or what would businesses be EBITDA. EBITDA XXXX for as a would way take seeing would do to and ratio is, that that use to from to should get improving I both I cash And I translation. performance metrics working cash conversion

Kashy Harrison

second QX of guidance. under could wondering And the was smidge maybe towards you recognize then, a were the actuals C&I. so looking us commercial you just into megawatt, QX, break we my helpful. look light megawatts about hoping could the talk question, midpoint was then, residential and That's And and it. help between I gap Got I like if expectations. up

in how think that about business the Just split between lines QX. three to

Manu Sial

projects, driven comment off say mix did EBITDA and number in light part light in between megawatt quarter for make a of of that Sure. megawatt on would to breakup gross the variance extremely perspective between is EBITDA. well businesses that both for I above out terms and was C&I about would XX% residential And I of guidance, has The a from residential midpoint is commercial of will some our business that the is business with... commercial commercial point that. margin so our megawatt and fourth XX% line XX:XX. Then first in resulted the the the quarter, I

Tom Werner

Last questioner please.

Operator

from Molchanov is question James. next from of Pavel line Our the Raymond

Pavel Molchanov

taking question. for Thanks the

during Net First, just was quick value for housekeeping. barely XXXX retained any up that? reason

Manu Sial

on to So I yes, hop can that.

fourth fourth as of we look and end as from value that portfolio realized And quarter. went between you out you that think, 'XX SunPower. reduced -- quarter number 'XX first the disaggregated I to of first for 'XX, the retained the quarter up and numbers cash quarter some the

end So you year. can the see that of the of increase to from year start the

the first driven So from in 'XX. the portfolio variance by quarter extracting cash was year-on-year us

Day. be Markets at with As we million Capital year, should $XXX we have you look next line the what forward range in to the in committed

Pavel Molchanov

demand Do lack Slightly broader reemerging extension. of this because ITC pull-in anticipate question, of demand you pull-in to 'XX? alluded you in the the year

Manu Sial

end So, of of course, that year. the happens the at

year, at been say something on. to the later us extended there already ITC discussions XX%. this that I'm would would of early this proposals And infrastructure And focus also year. of think end give that that further being be So frankly, there's I the an of at part I optimistic bill is

build that no, So as at we in. looked did XXXX, we

Tom Werner

everybody for so you forward much. next to calling with look thank appreciate Have great you in. call the We right, you. day. questions. we And Thank All a our

Operator

Thanks this participating. gentlemen, conference for today's concludes and call. Ladies

disconnect. now may You

Sunpower (SPWRQ) 18 Feb 212020 Q4 Earnings call transcript