Enphase Energy revenue dips 20% as solar slump offsets AI data center gains

Enphase Energy posted Q2 revenue of $291.9 million, narrowly missing estimates, as a 20% year-over-year decline extended the solar demand downturn.

The sequential gross margin improvement to 46.8% was supported by $84.3 million in safe harbor revenue and a $45 million tariff refund, the company said in its earnings statement.

EPS of 46 cents matched the Zacks Consensus Estimate, compared with 69 cents a year earlier. Net income totaled $36.1 million, or 27 cents a share on a GAAP basis. Capital expenditure reached $14.4 million, above the $14.1 million analyst estimate.

Enphase shares have gained 18.6% year to date, outperforming the S&P 500's 8.3% advance, as investors priced in AI data center power infrastructure as a growth catalyst. The company forecast Q3 revenue of $290 million to $320 million.

The Fremont, California-based microinverter maker has benefited from a broader solar stock rally tied to AI data center electricity demand. Rival SolarEdge Technologies climbed 9% on the same theme in late June, according to market data.

The Zacks Consensus Estimate for the current quarter calls for EPS of 52 cents on revenue of $315.9 million. For the full fiscal year, analysts project $2.10 per share on $1.22 billion in revenue.

The marginal revenue miss highlights the challenge Enphase faces in replacing declining residential solar demand with data center-related revenue. Investors will watch the Q3 earnings call for updates on the AI power infrastructure opportunity and margin trajectory.

This article is for informational purposes only and does not constitute investment advice.