Earnings call transcript Q4 2022

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Operator

Thank you for standing by. Welcome to SunPower Corporation's Fourth Quarter 2022 Earnings Results Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] As a reminder, today's program is being recorded.

to President host of like Mike today's I'd Vice Weinstein, Investor now, introduce for your program, And Relations. Please, go ahead, sir.

Mike Weinstein

would earnings Good fourth I like everyone welcome afternoon. to quarter XXXX conference call. to our

CEO new and XXXX, today, accomplishments we and and our customer operations. update with Peter provide On the including followed our of quarter by financing will who'll announcements call SunPower, fourth XXXX for specifics highlights, comments on our begin homes from expectations Faricy, business with on an commentary

Following XXXX. Interim our Peter's CFO, will financial results Guthrie Dundas, comments, SunPower's then and review guidance for

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

are forward-looking that XX-K harbor will regarding today's safe XX-Q. those factors to today's described slide forward-looking for we of During may these today's that these reports information release quarterly are Please Form in statements statements. XXXX call, see and our documents affect presentation, the various make Form subject on press and uncertainties risks that and additional

reconciliations. reference of certain appendix call. refer appropriate today's Please non-GAAP for today's to during press metrics the the GAAP non-GAAP will well release presentation, to earnings as our we as Also,

additional of Finally, Events we the have we've posted to In PowerPoint metrics. location, same of a website. reference historical the Presentations also enhance our will posted slides, data page call a this we and set which the detailing sheet call, during on Investor supplemental Relations

CEO that, SunPower. With turn to call Peter I'd like of to the Peter? over Faricy,

Peter Faricy

I'm five set goals vision on share and first forward. focused step on rolled happy At progress that made strategic on Thanks, with Mike, strategy, a plans to Day out good new our was last highly an Analyst solar a we've going important long-term of that and for pillars our XXXX. we everyone. and to afternoon, financial XXXX and execute the residential successful March, journey.

a above the growth, million. for XX% quarter, hand to XXXX our million XXXX. a high unit million we guidance. level year this convertible increase was the IPO year-end net to lowest into $XX debt debt the end $XX break issuing To with $XX this on We in years XXXX, finishing quarter, QX cash ago. full generation positive fourth the EBITDA records was quarter, at Business reported million at of $XXX year our heading perspective, us began versus put continue customer In adjusted of leaving the finish since cash SunPower's of in after over XX at we the

the to I shareholders. of our and work unprecedented SunPower Our and results year. of performance The want and is chain hard inflationary everyone SunPower acknowledge to and of for deliver to dedication their employees thousands thank hundreds customers last and for overcame due strong SunPower challenges persistence dealers. supply team our

come. XXXX, Looking ensure to with tools and I'm keep plans in years share to will investment we right ahead excited investments for to SunPower's capture product, to digital, in many you financial share building. These to our momentum the market our place to have that accelerate platforms

create this experience, residential enter build the year to with excited to our best-in-class customer are world. the We to plans upon in company solar fastest-growing

the added increase periods. year-over-year customer number Raven in that XX% that now Solar a customers demand pleased both and to report is Blue I'm XX,XXX to This be turn demand continues comparative from QX. strong four. Please to in we that slide includes new

as grew and installation increases at also of to continue the Revenue XX% price costs. impact higher offset product year-over-year

with customer channels XXX% sales our across year-over-year channel. from SunPower strength see the growth to direct continue We

the Our backlog the strong new another also XX,XXX homes retrofit in ended channel. XX,XXX and year customers with customers

XXXX. goal us $X,XXX well full target result $X,XXX for on a track achieve to investment, that's platform before by to grew to the allowing customer our $X,XXX, finish year $X,XXX per EBITDA to Adjusted at

at SunVault channel, a bookings unchanged system steady QX. versus attach SunPower the energy with direct sales a rate storage continued in XX% pace

products, XXXX year-over-year Reduction tax customer under continue of for growing beyond which increased Act. demand the is XX% expected in and We Inflation in incentives be growth because the the to new also lease for quarter. leasing Further

SunPower customer-centric serve Financial's towards lease loan low-risk well are believe remains demand. and origination We agnostic prepared model lease or we to financing. ramping

the turn with progress end including top XXXX full slide five. topline acquisition highly XX% successful late our number customers Please we XXXX exceptional growth original of our exceeding Blue saw and in to our Solar. guidance the In steady XXXX, of new in growth, over Raven year,

to the to buoyed state solar continues Looking share be of forward, and incentives is acquire SunPower rates systems the will strong higher policies, and we are despite under value ahead. that enable Inflation likelihood heavily products, years by interest bottom-line market grow. and people, Reduction bills. in decade rising to the continue value changing in of investing of Act will residential the This utility the federal another incentive The

improvement XXXX XX% a with improving with year. of of million the finished per We throughout six. adjusted number slide levels to $XX turn year-over-year, customer EBITDA steadily Please EBITDA,

by and We well, a improved in storage XXXX higher SunVault expect driven continued improvement attachment and power, continuous to effort rates costs. to customer year-over-year for pricing acquisition as reduce see SunPower Financial

seven. Please turn to slide number

of XXXX pillars we the Next, with I'd we long-term share the some five important in move like to of our progress strategy. as made forward

year, by progress, SunPower number meaningful experience, make installer solar one XXXX. Net continue our in home XX% last raising we to Promoter the remain and For ranked customer Score

modules contract XXXX. Maxeon premium, For through high-efficiency expanded our with extended products, for and we solar

We including Cells the have high-quality our facility. additional from Q for supplies Hanwha Dalton, Georgia also mainstream secured market,

work we whole added home also and have sizing X.X. options, We've multiple SunVault version including begun on SunVault storage backup

carry products industry-leading meet warranty US. across standards serve the quality complete and confidence to the and SunPower residential our reliability customers well-known the SunPower our of All

to launched we sell our into growth, with For partner to Dealer Accelerator additional the territories new products. and Program best expand dealers

to expanded network XXX more XXXX the across US. Our dealerships than entire in XX%

and coming are their important to charger partner. the their We be preferred an General also systems years, launched we with solar of EV supplier in collaboration Motors exclusive installation

Toll and with markets, well agreement IKEA California with a as Solar KB Home Brothers exclusive contract an as national Home. announced extension in we Additionally, with

a experience, for continue For with real-time we allow will power improve utilities. interconnected and that visualization ultimately communicate dealers virtual our digital, of new data launching software build and to the to tool systems initial with response our plant demand the along customer

finished XX% finally, leasing XXXX. rate And to we our on Financial year-over-year, finished to with financial bookings long-term of significantly XXXX loan rate, XX% in by half track attach the second a net bookings SunPower and up are bookings attach meet XX% to achieve with contract XXXX ramping increasing lease a year. target We XX% the with

XX% rise rates November, despite continue in such slide moderating XX% to gas. have turn increases year-over-year greater states Nine number cost Please sharply, to over electric eight. see Conventional key the fuels of utility natural year-over-year. than to continued as

noted, bills. stabilize we've continue proposition steep to ways home As as one the powerful elevate residential these value most power of of to rises solar the

the three prices recent over months, Electric projecting XX% fuel years. in have is declined XXXX Although, a to electric the investment in XXXX Edison increase Institute previous capital from utility

these electric bills, of are customer investments recovered rising. likely As finance value through is rooftop to solar continue

slide to number turn nine. Please

as they lock energy implement interconnection as As April regulators net state preparing eligible in rules into the to current metering the to then, submit X.X are customers on before most an application long you NEM California Until of that rules are know, XX. new date.

application a possible many California as report bookings as response change. the new seeing advantage backlog our investing and currently rules to and current to in before as pleased a the of as marketing result customers process well sales I'm in we effort are interconnection that are We these ensure efforts. as the take that significant of heavily

of storage by battery. Once generation across the customers materially rules X.X we their in systems their may battery day expect the to more power of in use increase value NEM storing new take California the hours as effect, solar

seven storage own can for to added. is to years, solar-only that period the is nominal suggests Our under improved X.X NEM be nine years when system this analysis system XX but payback eight to

We well-positioned for to entering meet believe demand systems to SunVault storage that inventory we are XXXX believe stronger year. customers the SunPower sufficient to levels is with deliver

number turn XX. Please to slide

Homes slowdown for quarter due economic the New the an a As to you from we conveyed presentation, environment second may industry. homebuilding expected our recall segment broader sales affecting slower

growth an beyond by multifamily XX% boosted efforts Homes California. New Despite year-over-year recognized, customers this, sales for segment nascent national and fast-growing the reported but rate our impressive QX,

a the XXX equivalent growth benefits includes growth customer EBITDA in decline multifamily as adjusted non-California is of versus SunPower for reduction which year-over-year to XXXX Our a customer assumes overall in the sales. guidance XX% rapidly and a assumption this new and of point basis year, scaling home last whole. sales Overall, the

new term, of for need US. there's nearly homes in to the a Longer X the demand widening growing housing million satisfy

intend on the view strategic to We long-term our strong building leadership already position. segment we continue New continue asset as Homes an to important where

credit the credit stand-alone a Reduction Inflation The XX-year XX. number addition for solar, in slide It bonus to benefits systems in also pricing includes for of storage. Congress to stands of and tax qualification power, a tax includes to monetize credits extension XX% XXXX turn a Please Act passed XX% battery several that apply the sales, these for credits. important customers. through stronger leased increased to well-positioned SunPower combination brand-new bonus to

content supplies for more on and likelihood Number we XX% to domestic are the domestically bring bonus additional XXXX our one, we expect the credit, in qualify XXXX, suppliers we increase PV to adding domestic for sourced that modules to beyond. and

lease tools XX% to activating is for for more new direct low-income SunPower sell operations customers. the XX% and reconfiguring SunPower marketing two, Number credit, capture to bonus qualifying to dealers, building

to And these mapping made sales so available incorporated credit, bonus that into tools our communities finally, this energy out three, for customers. our number be we're community and can

turn slide number Please to XX.

in low-risk loan of best and origination the noted, customers. on financing either leases are lease, we or act model strive for fees is and customer's based origination With to off-balance agnostic previously our As interest. similar sheet loans the for

in lease see to rate of quarter As can grow robustly net here, at XX%. fourth our the continued bookings a you

the to leases continue XXXX, in as We projected due the IRA. into trend years to expect tax bonus the on popularity this gain coming to incentives are

To be this on are prepared clear, well we execute competitively and it. welcome we to development,

per interest below advantage capital believe that or capital stack. is with the than least tax better full of added We rate across sensitivity at our equal lower X.X%, remains peers. including leasing this the equity, to cost all-in Our of

place We through pool have ample growing facilities finance in a lease XXXX. to

in total the the XX% bookings of XX% quarter. QX grew approximately also were bookings and net Loan in

which facilities, now private purchase $X basis the We billion continue points expensive XXX to improving in well than has The benefit long-term bps provided to source more market. securities less through of in future. XXX capital of tap cost are of this market low-cost, of tightening important capital XX the asset-backed loan to than spreads remain late, been XXX QX, we to and with ABS from positioned

slide XX. Please turn to

it important are of some efforts undertaking turn share to want to XXXX. most I I the we the financials, investment over Before in Guthrie for product

have to from recently and pleased As expanded Maxeon very XXXX. supply earlier, through extended I mentioned premium high-efficiency for modules our solar we are agreement

We've to including also with begun qualify lease that mainstream Georgia, of taking bonus high-quality Hanwha for applicable for in positioned factory Cells steps content. a systems credit their supply Q market, modules Dalton, build to tax IRA hope in be to to domestic the we the suitable up

with vehicle-to-home Number already begun a expected two; limited charging a with of we've release work General EV bi-directional Motors in QX system, on development XXXX.

its collaboration. and has incredibly of partner As SunPower and important part storage this we're projects, mentioned to made GM excited solar earlier, be for exclusive

control EV faster as storage platform next-generation with VX the second of finally, upgrade SunVault design installation begun chargers multiple on easier, new an we've and engineering complete I And with energy will a and include our multiple monitoring work mentioned including generators, load and earlier, configurations, This process. features, integration over system. version

We second of half targeting XXXX. for the a are launch

Guthrie? I'll results. QX on now for to details turn Guthrie it more our over

Guthrie Dundas

Thank turn you, Please to slide Peter. XX.

customer share and XXXX our customer, per EBITDA increasing increasing Peter As and target strong EBITDA customer demand earlier, through of long-term market support per steadily for achievement mentioned model XXXX.

EBITDA quarter, in XXXX are XX% XX%. QX, year growth increase non-GAAP Blue year-over-year XX,XXX both and million fourth $XX a we was of Full Raven million new the revenue, We XX% of reporting customers that Solar periods. in increase year-over-year. an adjusted added of For customer includes $XXX now

is increasing combination of of EBITDA equipment, per for remain quarter Adjusted platform margin a customers. and $X,XXX and growing to leverage gained Adjusted from pricing, from investments $X,XXX the sales. the full as customer shipping at continued cost passed origination labor, fee the to as operational along volumes non-GAAP for year XX% before Financial, in increased higher pricing to and above SunPower we the benefit gross

investment digital, platform $XX As the quarter for last we the million million at highlighted Analyst the for year, Day full and is OpEx. year of primarily $XX corporate and product,

$XX million $XXX XXXX Our in and the sheet million it's on balance only now hand with is of net been of debt. years, healthiest cash exiting recourse

million January, convertible approximately ongoing paid We arranged a X.X term for our debt fund we remaining to and ample including entire sold last hand. million last down with cash XXXX our $XXX of investing using million $XXX In business, continue and year $XXX $XXX shares equity on our we operations million in and Enphase loan liquidity revolver. from the million begin

value in estimate of to X% ownership now about the net lease SunStrong value growth using our continue We at in value renewal a million. With the $XXX discount our rate. we retained stake portfolio, of

turn Please XX. to slide

Peter earlier, initiating we As are mentioned guidance today. XXXX

by $X,XXX. $XXX to per $X,XXX of with are investments XX,XXX We guiding million driven to $XXX XXX,XXX customers platform to adjusted adjusted incremental million customer to EBITDA of EBITDA, before

expansion the operating EBITDA Platform that primarily investment future continues to and are customer. corporate be per expense the of for company and product, preparing growth of digital, comprised

investment reinvest of peak is the from higher-than-expected the the over of shares Enphase to basis, portion significantly On projected as a platform a XXXX customer past year. sale we in proceeds per

making We Analyst good growing adjusted $X,XXX. a also market versus Day our EBITDA customer target which to are achieving range progress of peers, towards to growing $X,XXX includes our per share model, while

below increasing investment time. to we future we us the so rate of grow customer continue per customer growth, years, rate in over the While platform declines expect expect

from the As includes customer $XX EBITDA approximate Day reduction three, These important million Peter guidance noted point SunPower include approximately one, and resulting homes; NEM includes SunPower earlier, for growth growth year-over-year the an is overall Analyst target orders basis impact customer SunPower's basis investment platform the storage reduction which in two, from of our model; rates. and XXX impact that X.X above several point battery attach to growth XXXX new to four, transition assumptions. additional in of impact NEM the California, from approximate the XXX of in Financial the QX; an continued installations X.X

potentially but see are pressure we several continued homebuilder help Homes investments very capture rates; reduce industry help the the and to rates; the on mortgage XXXX, business. our expected the battery customer solar nevertheless that for experience, These SunPower market improving continued and four, for EBITDA New share. trends value, growth storage one, beyond segment, that recovery significantly Looking accelerating and acquisition include: positive customer; improve attach propel IRA demand financial customer higher from three, growing assumes per Financial platform costs two,

a ranked strategy to our model continuous target track our towards of We and number we the building of strong a achievement customer that long-term sheet of experience. balance entered a XXXX are enhance improvement, philosophy executing on and one our assets goals. total With platform continue will world-class

I With for the that, operator, questions. like to turn would call over

Operator

Instructions] and follow-up. ask to that limit you one yourself [Operator like one We’d to question Certainly.

time You may as the queue back in allows. get

Morgan question Our Sean of first comes from Evercore the from ISI. line

question, Your please.

Sean Morgan

Yes. Thanks, team. and Peter

how of starting heavily, been going So sourced one materials resi. wondering is, domestic we're to supply in of from I've about heavily base light content of work things recently fact that offshore the for is the

be of to for system? content based is adder the situation value on ITC the the going is where also, it so, full a domestic And the

government Or system credits is available. certain there in so do you domestic that and get where components to really like, items a like, credit are say, US-based, are vendors that to do the for you allow, could some no content going maybe you for, where think piecemeal qualify cases, would basically of

Peter Faricy

the of examples Cells, particular, optimistic we And benefits IRA those about. IRA. products cautiously would with domestic be the excited benefit kinds the of you from of have Q content talked the Yes. Sean. that that panels We're for partnership super we're Hey, the about and will Hanwha benefit in the

this, be it total come the of and cost expectation our equipment hasn't above the have be that -- our the on will out final but to certain system it it's a It's will yet guidance threshold.

I are the domestic the cost. think XX% rumors total for I've content heard system hardware

provides it qualify, the benefit including you and if entire then installation labor. system And the across cost,

And the once the accordingly. that's final thinking and final act So that about we're we'll guidance. way waiting current for we're but modeling it, we guidance, achieve it

in about thing question that, no me think interesting Energy the see out this. going There's it. to jobs is of I US a you're to Clean growth

number adding US panel have operations. We a expanding US new in had manufacturers either their or operations interested of high-quality

its So, tuned stay think, I here.

opportunities our I on us grow for think domestic there'll be content, to PV. more particularly

Sean Morgan

correct is then if is or and Dalton, Hanwha if the maybe -- good wrong, I a Cells Hanwha, completed materials guessing -- Okay. But Georgia. I'm kind lot me is abroad understanding not Q example starts maybe process probably mean, in their supply of I'm and the a correctly, their or I'm SunVault. of their kind assembly chain of

they're cost up qualify. product? is with to, sort a finished in then maybe they think I some here But where it attributing labor the of guess you I with transfer to do the assembly the creative and the costs going most come guess, material pricing how system could relative treat government of US to So, would say, a

Peter Faricy

I with Yes, is in you're play think our belief thinking, is will how out. line this Sean,

probably create time. the Georgia. I I'll positioned make it maybe the Dalton, But it, think are would our way assembly, chains some is process opinion in to supply which over to in opinion, the want call doing jobs here what in US, -- given you today, in that Hanwha sense, was there's evolves qualify, value-added if my certainly,

opportunity think US I That makes jobs. certainly US and grow have jobs expansion they big sense. to about certainly their that, with announcement And an made that is the they recently

our opportunity to that of under those products it's good expectation IRA. a types qualify So, the have

Sean Morgan

Peter. Great. Thanks

Operator

ROTH. line question our And of from next the you. from comes Thank Philip Shen

Your question please.

Philip Shen

with QX XX%. sharing my Thanks that for Hi XXXX, went all Peter, thanks the that around lease as and shift mix detail ending questions. for taking through everyone. we

you XX%? higher? you capped As grow Do at that through think can look meaningfully that you we've think out XXXX, do

where you one-third or maybe cash being years think few the as talk be? XXXX? And past the with loan, guys Do years money about can to share business over -- might think expect ago, loan that one-third changed. you then mix I do your you cash, cost clearly, then And used the used in historically, one-third lease, and what of be think low you you to to

guess And the success as had Thanks. then they in financing had finally, be Blue to that Raven shifting loans mostly well? was leased historically, my group have

Peter Faricy

Yes. Thanks Phil.

of benefits our -- the first lease to lease, out come question It's tied that about that opening On we defined, get adders about all are on will think we expectation talked IRA in the comments where in lease. XXXX. your our do as those

will our more as we it's So, expectation go. that, that even lease make attractive

And so I would expect throughout go as the that XX% point some accelerate at to year. we

In I terms cash, XX% let's of it beginning our the sort mix, year, loan, said last may think we've and are year, we're XX% would the this it. of roughly that it color, XX/XX financing. as scale for it's the benefits at was And some I at that of closer call even full probably anticipate be IRA clear year. XX/XX, that and happen to will point

particularly product. And residential that's for the individual why we do we're to customer We we're really And philosophy only of want them. feel solar them out right like each looking for the for them really financing company what's is best well-positioned that choose agnostic. we're the interest with offering customer to the finance best for if what's and they in the the long-term package

lease do sell need loan. bit point so launching that products are happy that to Raven historically mostly scenes to year. the time, you I and to some to of they're lease at And but anticipate had more in has the us move that over this point -- correct we working And and be behind Blue ready we're a business I'm anticipated to little team Blue they've help report Raven the to then out cash, been

a certainly grow there's the we closer. share footprint well. to more to as in States that So serving, given as be it think, going opportunity details get think, But, of we'll lease a part offering makes I states United those that they're the sense, by on I having great our

Philip Shen

congrats in the And Peter. relationship, and with then, expansion that on Maxeon Thanks, comes that supply of Great. terms your additional of that.

be total how guess Maxeon module you I the call, if with this be now for half talked able is in supply, might that's on can think, through My be maybe guys I you to was that XXXX. -- what about wondering going account of now? the talk could supply to QX higher additional your

be in can And as then, get we've Hanwha, I of you think And be supply how into written much to the then in able about Huawei other vendor. relates it to might XXXX? terms might how vendors, they another

through might talk could other more you in? if come module wondering where about Just vendors

ultimately, this see Maxeon of rest some grow your XXX kind could meaningful time through the we backing ability market, for And the loan XXXX. more of -- with maybe of megawatts in into we're to challenging

guidance would that guys in do than suggest, now. is so, megawatts maybe could XXX official substantially And which you higher XXXX, your XXXX

that that get does your bridged. is how sense my your be there conservatism know so, Thanks. I guidance, could is some And but guide. And gap guidance in ultimately,

Peter Faricy

Phil. Thanks, Yes.

for So almost rewind first the big been supply seek in the history time Maxeon on just to panel the a partners to with ability terrific opportunity. back which from call, for for year, agreement our sourcing context benefits redid the our across time one world, the was of we last has for at when SunPower everybody this

They space to wonderful Maxeon to in for that the and in partnership for the hope said really have happy panels and our come. able and to the be both with to we we're many, We're premium best is make expanding to pleased premium be still world. many parties, Having agreement with with years them that, extended work Maxeon. extending partnering

So with that. we're pleased

was in was about the terms year difficult investigation world, we're out thinking was the there very When up really AD/CVD, investigation In supply and and Department how came Commerce across it dried of challenging. the of the board supply, has in but where that wanted have only get on that as ourselves happy quickly for put growth. to to. supply us position sufficient we've I'm we And a report new we changed, to supply as to not last

meant to is be guidance And year our conservative. this

to recognize supply that. to having the enough agreements there's that. think and faster opportunity the flexible I we and preserved grow in But we've serve uncertainty supply by economy, some

agreement Right to in have I the that and with talk our prepared on the come. of Thanks Cells, agreements and about for to details question, Phil. works, now, Q you Maxeon more months in we're but all other sharing the just with we look to forward

Philip Shen

Peter. December were now that NEM from X.X, Yes. last really They first maybe We're kind the Thank of One lows. you, well weak of are up you one. now. quick picked seeing three weeks January. past originations the

so, What is could there transition? acceleration And it way, are it better? far the nice is but be a seeing thus in you or X.X Thanks. okay, in the NEM

Peter Faricy

Yes.

So you're right.

the the I period. things because bookings election that time down think mid-December only was lot time in hard year the slowed the if to front of sort was reasons cycle, mid-November a potential of of on where there. economy, last to holidays, the know there's It that

the paying attention so get demand particular, year across country, California. things like with the are to first a to at. far six very on We've really but what read looked in weeks close we're very, where has very been this And pleased

X.X, we pretty could we're California plans would NEM we much had so to I for want many try figured would We ambitious because thought to qualify for those grow say consumers exceeding far. how and expectations we that

been build week-by-week. that is a been What's it's interesting

was week three was better, was one week good, better. So, week two

peaked week, and us, even so you building so last it's six haven't we And week through if far go been yet. for

to with the frankly, enough in that far, is long So, weeks solar environment Thank I'm would us I optimistic, not the how so finished demand. very recognizing and cautiously both overall judge six as this year. to describe we you. NEM residential we're pleased California quarter, so But the far interested and early it's but on see

Philip Shen

Thank on Great. it you Peter. much. so I'll pass

Operator

question from Thank the next comes Kashy Sandler. line Harrison Piper of our from you. And

Your please. question

Kashy Harrison

you thank for Good afternoon questions. the and taking

-- me one was is account. my customer the So, first question first for around

year. be add how you this today under in to have speak to XXX,XXX of California? these expect And You can many customers expected of then from locked been X.X? XXX,XXX the to What NEM proportion is

Peter Faricy

Yes.

some So, easy as for to rest think provide way the Think split expecting. of it the would California, XX% at it that's just XX% year total the to customer of about XXX,XXX, The be of midpoint country, color. we're accounts roughly

determined, we pulled I think that have actual a business much to by will how the chance QX, QX QX, be gets numbers install throughout bookings obviously frankly, QX. into

So, the I'm how will -- that second again? question year. then determine percent your evolves could And throughout sorry, you that repeat

Kashy Harrison

has X.X was I I may NEM you wondering locked before just in California proportion was XXth? answered been it. the April under -- of today what have already

Peter Faricy

Sorry, yes.

backlog So, talked about QX of and us. carries in as beginning it the through QX. comments the -- I we have opening really Think of about that the

So, QX helping them done all in customers, we're additional just get faster we are the customers booking fill adding now QX. either if to or that our us out operations pipeline

do But a perspective, or for a of two. one would is is the previously a say things quarter with quarter, the seen I from maybe a NEM down California there change. buildup place, after slow before we've that things And then the takes change

and to the of whole the here the of business reasons a makes a California just of course good out backlog up sort one we're That's it in big business this take our heavily so practice over to And is build smooth investing California of QX year. advantage sense. in

quarter particularly things and resume our for will battery. time we'll to back advantage get plus the be growth rates that fourth as the PV back by normal we of offer expectation solar the both It's California on more track, take

Kashy Harrison

at ABS and just saw then, you question, I XXX points the QX looking in my a we what XX, that and Thanks guess, slide basis Peter. was that January. you And to I below of XXX in capital have in here then cost follow-up indicated

-- so $X of Can through for that or us originate once of how -- about why capital you your indicated refresh customers you run walk alternative lower do you SunPower think billion much capital Financial. of through us the cost $X -- cost once you And to is that on exactly why sources enough then, about billion?

Peter Faricy

take do Guthrie, want that? to you Sure.

Guthrie Dundas

Yes.

happy our very we're for So both sources of lease capital the with and loan.

very we're think I competitive on both.

of I of essentially think which comes or have demand, to to around very on we’re income happy lease mostly most I'm loan. your -- the all this capital is rates. side, fixed fixed serve question with But year's

So it's much exposure. sensitive to rate less

loan our to we've capital side, that we market, that's and different the market, investors, forms part of the intend forms institutional ABS involve banking and -- include like of and area via of diversify grow additional partnerships things capital, On that. an direct

to plan of sources only like hope impact capital types of capital, looks not certainly we cost from certainly capital, and but of which the number our to institutions, expand of going what will forward. So

Operator

question Joseph question. moment One you. from line next Osha next of comes for Thank the our from our And Guggenheim.

Your question, please.

Joseph Osha

go questions. to you to I there. comments that the credits. taking of wanted Hi, additional made for some the back my Thanks tax on

So that week was this obtuse. the might energy be looking think after I communities, described released as was earlier on best which I guidance

at process, And equipped I'm and long before think wondering, your the you think dealers and that handle really as is to it apply for fully you yourselves you them and look have going how credits take whole that process? about to claim and these

Peter Faricy

Joseph. question, a That's great

imagine, to to Treasury, to As think and many sort of you needs we I provide inpatient they're want to trying Department And think I as be of guidance an out might fair the leader, constituents. done how business it the yesterday. meet

needs specific. believe for and earlier and better low more we communities, be But needs needs the defined both came clarity to out do be income that energy to and guidance more

communities. these When I Department know have low-income serving met are passionate how of consumers and US the energy I with about citizens Energy, in they

to be right good, of So working Treasury and act I without upon we're the Department are for it that's on with now. businesses more but intentions know difficult what will clarity, the

it's directly answer I know they to probably we'll I would So I they your as I about there, as in still built say, take make optimistic. this practice. is if a that it's the we and clarity be want can that that happen right. the can, get kind certainly tools, remain this And of before and To care quarter regular and business our another sooner, cautiously question preference. would

Joseph Osha

what was you. more on the Thank question, side. second return then really Okay. And asking, the to lease Kashy

third-party place as financing You've out, saying in got on be seems more pointed -- term cover But to you to to industry are basis. you enough shifting the ownership longer a year. this

come PPA might special you is that, at market your out that there competitors? perhaps, we given alongside So, way lease there ABS you Hannon, as some, in your relationship you about with the with see securitizations that might or think

Peter Faricy

you that? cover do Guthrie, Sure. want to

Guthrie Dundas

course. Of

we we as we additional equity across are the in confident to stack senior potential our in should say going subordinated capital. other of have -- and them. capital I'd need -- discussions So, partners sources debt debt as quite market Tax bring are ability well

and to bring of Hannon have in lot to a we with them is partner to runway all partner the wonderful continue a them with capital. working of

efficiently include efficient all business lease to monetize I include -- continue raise that securitization to with evaluate in other most of our confident capital So, various and we well, forms ways direct our efficiently. to and and can we market could but could ability think it that the as very we're

Joseph Osha

Okay.

the potential market the some one of you could at the the see of least we So, -- ABS lease point in outcomes? That's on side. one at

Guthrie Dundas

one for the sure. outcomes potential Certainly, of

Joseph Osha

Okay. Thank you much. very

Operator

from Bank. Thank Deutsche you. line And Corinne from our the next of Blanchard comes question

question please. Your

Corinne Blanchard

you Thank everyone. -- for evening question. Hey good

that to could The first maybe cadence quarter-after-quarter your give like us maybe try could rough the for one, you commentary? if the EBITDA, expect we

what is the range range? in and high you. Like EBITDA guidance? Thank for question baked of low And be would the the key the taken guidance the then second --

Peter Faricy

you, Corinne. Thank Yes.

to actually, Analyst back go me let So, I'll with Day. actually start XXXX,

now investment both and business what EBITDA we're years vision customer XXXX gaining out XXXX XXXX a think XXXX and well from per I leverage more standpoint. and customer of in we standpoint over and laid and in was standpoint and part this between XXXX, on and track, EBITDA heavy

we're looking to pleased and So, with XXXX. forward we're XXXX,

on give how question on we then your year. think me throughout the Let some going and it -- about to answer EBITDA I'm the you the context

XX% my of EBITDA in year guidance this as comments. The our said we at grew year, opening midpoint I XX%, is last growth. So,

that's X,XXX and be So, back have quite business excited Day, happening at that to is bp we it an expected acceleration. That earlier we're have would in acceleration, frankly, already. the leverage than Analyst

it and back-end year. would EBITDA EBITDA pattern sequencing first we we true about XX% same year, did same Last be that in be loaded and say XX% standpoint, exact were XXXX. though From of this a guidance, in we've for second last that half, most EBITDA for even modeled of half, the the we give will the thing don't year quarterly

pick could So, XX% year. as and XX% again it you this

QX, particularly there in some that for is is seasonality. And context some

and related of is than to here. Part that’s weather quarters QX smaller piece the year. So, the beginning of seasonality other the of the three

making But for in we're qualify as one, the purposefully. X.X NEM helping investment really made about That’s unique many California for are a as factors two be smart unique customers possible. normally that's And a big wouldn’t have investment that particular one to quarter.

on we’ll expenses extra taking So those in QX. be

a of also QX context, quarters to homes last year new best in for two then homes. some QX was QX last in of and Quite year. EBITDA bit year And our were last new from our due

and so, new our year. talked this home And slowdown modest the for homes we've expectations profitability about new

some give grow to of QX, year. make we our still investments business color, build would XX% for just we as So you I be but modest expect the the in to QX, EBITDA QX these and to say, pretty

Corinne Blanchard

other like you Thank on, can Like, you. what color million? the in what wrong give reach or take And, $XXX million, you it yes, can to just $XXX to the would guidance? any if baked just the maybe go reach for what's like,

Peter Faricy

Yes. positive is not sort That's of reality. -- tailwinds. of the a headwinds story. It's mix doomsday it It's it Well, of we've as not and mix story. a strictly about a a thought

impact that about then the factor could headwinds We On economy there this that's homes there's new about obviously, And talked we out in our sentiment. talked remarks. California NEM. front, consumer inflation

be is more net The to to more valuable. and positives talked which continued incremental costs make an benefit two rising have about are this as utility IRA year solar we is well, the going and the

net above either were conservative is, our and we guidance. takes NEM, you is homes out XXX for the and California those on one we those of conservative both conservatism, to where for two outperforms So that new

And be in said, is -- happened in then, any if us first It's pleased. to the we're there early of the confidence and anticipating, way just customer say, California going unexpected the feel any, guidance. weeks really it's we're the headwinds pretty kind the homes new closer way something that And But, think, about push where happens. But of below like the I we good economy are on we're XXX NEM. to than variance those headwinds stronger then of unexpected I too I six XXX. then would that year. after judge we're as XXX below or to -- so its If far, would

Corinne Blanchard

right. you. Thank All

Operator

the Thank our And from you. One question. next Perincheril question from our for line Susquehanna Financial. Biju next of moment comes

please. question, Your

Biju Perincheril

NEM your you we Hi. attach of can sort do do I rates about transitioned battery the can for increase talk you attach about mentioned double-digit Question rates. to you Thanks now? how you the where have to also Once to from, fully supplies related taking attach go? that, can Good rates question. X.X, low you afternoon. think, expect quickly And that

Peter Faricy

Yes. Thank you.

I headed, noticed dynamic becomes think advantage X.X that NEM rules look is California the really, consumers critical, help really you a you putting if battery take in where California that this structure rate at you so are of immediately take what could place. is

part saving really more the the battery And there. something become for money. option would as PV the so, to critical why And be likely resiliency that actually battery that's is helpful of to from standard goes plus something

has now are XX%, played at where like if battery and this over rates I take their country So, take look look you out believe attach a Germany, you a a XX%. at

that's I point, California. in So what at think happens some

seeing on EV consumers and more and plus think opting and a plus PV more new front, think over most Certainly, new for the retrofit homes time. charger. our that more homes, I homes in are of frankly, I battery you'll we're more But PV plus see battery

rates also Our haven't the talked battery take a faster, a are view I'm the long-term direct in for we channel but about. mid-teens our they little grown we disappointed business. attach of as

of installation over time have buy to a battery a other doesn't have to customer In words, battery time. a PV at the

also growth in advantage point, think And take important both are they to batteries for California batteries see that and some at going future dynamic rate structure understand this adding program. we're so of VPP people and I some how to as

talked I few it's or our So, was hope to probably we're years. the closer a XX% California to like Analyst maybe within in would battery next above presentation, think something we've expecting Day level that I attach that. rate about And that that getting

Biju Perincheril

is, then gross your And that. have for a margin follow-up when product? available, improve related battery next-generation how Thanks does the the you on battery

Peter Faricy

Yes. Terrific question.

market I the I the struggle to makers that profitably. profitable think it's as to, inventory our I'm standpoint. happy battery from my batteries many understanding an right may battery -- It market sell across be we're that as profitable. is I business now, we battery solar US, report see to not as and growing good position battery fast in wanted it think is but a

cost install products dealers and And work SunVault to in a we're for to going on and that's is think matters to are to these putting the I side, X.X, I customers. what it matters cost the time and out we to bunch forward-looking, think takes Once in what to take re-architect consumers able But the going the that's who we're commission. the actually critical. and on significantly the field of installers product, reduce be

a right. get a at generations batteries them space, taking it look take the couple So, forward-looking, you to if of all in battery it's other competitors the of

I really product we're very but and a good, opportunity will We an scenes. have in the space, be for us ourselves differentiate working we're on solid a today, think what not competitive you. that's about differentiated this to product excited X.X Thank behind SunVault

Biju Perincheril

Thanks.

Operator

from Thank line Raymond you. Pavel comes the of And from James. Molchanov our next question

please. question Your

Pavel Molchanov

Thanks for the taking question.

the As having as more a they states you ago? year not of demand in emerged have or were saw that are any can last decade that whereas to year rates utility table that there jumped than you geographies drivers, previous combined, specific point

Peter Faricy

but been the say sure I it by point the Northeast have not the necessarily we growth of in compared year country. delighted part I'm Pavel. will to can a surprised and I ago, Thanks

has been. our a outgrown customer what of So, if has that look older, Massachusetts, think these there I over that due take have expectations Connecticut base And really business systems corridor, Jersey, of to time. you installed energy is a at York, inefficient New would that, New lot our much that

the average feedback. mean, is across solar uniform hitting quickly. why think with wanted the of consumers I probably to and amount what's big on pretty have I discussions really it's So, list board. XX% area But money. US. have customers they come it reasons make very an save high due solar, we we're it is Northeast an that's they prices. People to every normal the increasing month. on want that's that I the growth of as and its sure money outgrowing risen they But is save that They interesting of down as new to prices the came always And on really they save purchase, seeing that think a focus is have to rate utility

Pavel Molchanov

Appreciate that.

we along that about so, your Are installers now XX-odd wage rising lines? anything if and years. issue? of geographically rates shortages have the where more those in labor lowest complaining or up, any And rate Following unemployment is an

Peter Faricy

been We've with been the on to reason mission very fortunate. difference fortunate a positive labor we we've And make I of the is that special a in are world. part think

California. So teams I was over just two of our out installation with a number throughout past weeks the

a inspiring. like done. the customers see haven't on delighted. getting mean customer it's our chance all out so who hard work to a those had are up this For there athletes I roof, go and are professional installation, teams And

and the had staffed. hire able So an weather fact the year, we conditions to work we as it's the vary sufficiently need opportunity really have hire and being throughout challenging to widely that stay despite to

I in I'm and we us our how is when our how important for field talking value their And critical that's things number to care the the installers, safety one that the out values of core is. about I'm talk safety. first One much is that about

making constantly doing of see cut in can best helmets we gloves. sure if the our improve constantly we're terms So audits they equipment We're and no safety have to performance.

really sincere and company addition in SunPower. like through, to to I think mission, for people I the many want comes value day at the a of end the that And work of safety, think

So we've been fortunate so far.

We by shortages. really not impacted have been labor

were were of stay a areas to plan hire difficult more but year. for, couple that Beginning to and specialty of on year, last had last hire we still able throughout we

And cautiously the same. able be do to far we'll I'm so optimistic year, this

Pavel Molchanov

much. Got it. very Thanks

Peter Faricy

We've you. more questions. or time two Thank Thank you. got one Yes. for

Operator

Ned question And Baramov Wells from from the Fargo. of our today for Certainly. line final possibly, comes

Your question, please.

Ned Baramov

Hi, guys. in. Thanks for squeezing me

that XX. about be by a other installers for You there California, Is offering customers effectively terms stolen application due your growth faster in backlog rushing submit to to end to to even mechanism before up risk a the or place talked is you your April times, in backlog so get there customers the in in their have if remain backlog in of they quarter? customer, their in to falls systems, that installation that until you installation that lock or the third better

Peter Faricy

Yes. Thank question. you the for

And choose customers confidence for well. the who customers panels, SunPower, So the have world-class customer history experience normally our residential warranty SunPower, that's a combination we have and highest-rated choose consumer the because solar. United States of in we the the at serving high-quality long

period. it's So that our remain once they'll expectation a that customers with up us and throughout contract sign that sign time with us

on in customers be try give months. the customers installation a few when One of installation, to some do it that could who to to guidance take their have simple more they'll that good likely next be still is installed for We know trying for things in is the we're able place. California

arrive. take have it those will us who as those on to home they work upgrade, fair But include more or their for installations to we that get and reroof a before of do have customers longer main panel to could a complicated amount

of us reason the So, to it's many think will as expectation very work will our that through we us SunPower, they've that and we backlog. we through customers our about these them with, and begin stick feel remain good with chosen

Ned Baramov

That makes sense.

Peter Faricy

very yes. -- Thanks much today everybody

go ahead. Sorry,

can You up. finish

Ned Baramov

on previously the million to this you $XX additional improve a one the just accelerating EBITDA where investments be, to of reflection Is quick customer? in XXXX. or get to the to per requirements I want platform unforeseen investment, question just had you

Peter Faricy

to drive and more growth provide growth opportunities. investments Accelerating more

of quite on, opening programs heavily comments, are arrangement, VVP I page went working agreements, and examples GM we're these in. last then services the and excited our about are other the So, examples through that battery grid the in new panel like those things we're investing new

purposing future. new I is back we're today will between seeds would to material. role this between just reach and we of and deliver and of I'm growth, opportunities call, this think my But trying in time by not really results constantly XXXX as for company sure And our now we XXXX. forth We the business what, that to invest become make

get it's of XXXX best probably a material some by would but that in examples on and year. today One It's It momentum the XXXX. count material be on in of VPP. will a scale. to it we're more again business smaller time being we to XXXX, that business gain the is we the kind of this It won't begin

and that's a about to being a strong our the special. grab here part and grow is we in we're invest lean of in, land sheet. have So, balance smart and in very strategy leaning something It's US. -- build all and We're

Peter Faricy

for to and and forward questions, thanks results look sharing to we very you of Thanks details all with you our Big for XXXX. our terrific all the a much.

Operator

ladies and you, gentlemen, today's conference. conclude Thank program. does for your participation in This the

now Good disconnect. day. may You

Sunpower (SPWRQ) 15 Feb 232022 Q4 Earnings call transcript