Tigo Energy (TYGO 5.71%), a provider of solar power electronics and energy management solutions, announced its Q2 2025 results on July 29, 2025. The standout news was robust revenue growth, a significant improvement in gross margin (GAAP), and a return to positive adjusted EBITDA. GAAP revenue reached $24.1 million, beating analyst GAAP revenue estimates of $21.5 million. Earnings per share (EPS) were $(0.07) (GAAP), matching consensus expectations. This quarter’s performance showed continued sales momentum -- particularly in Europe, the Middle East, and Africa (EMEA) -- while operating expenses (GAAP) remained flat compared to the prior year comparable period. Management raised the full-year revenue outlook to $100 million to $105 million as a direct result of these stronger-than-expected figures and solid backlog heading into Q3 2025.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (GAAP) | $(0.07) | $(0.08) | $(0.19) | 63.2% |
| Revenue (GAAP) | $24.1 million | $21.5 million | $12.7 million | 89.4% |
| Gross Profit | $10.8 million | N/A | $3.9 million | 177.0% |
| Adjusted EBITDA (Non-GAAP) | $1.1 million | N/A | $(6.4 million) | N/M |
Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.
Overview of Tigo Energy’s Business and Direction
Tigo Energy specializes in module-level power electronics (MLPE), which optimize the performance of individual solar panels. Its core product line, the TS4 Flex MLPE suite, provides functions like rapid shutdown for safety, power optimization, and module-level monitoring -- important features for maximizing power and meeting strict installation codes.
In recent years, the business has focused on innovation within its MLPE line and expansion into software offerings like the Energy Intelligence (EI) platform. As part of its growth strategy, Tigo also emphasizes international growth (notably in EMEA), lean operations, and the mitigation of supply chain risks via geographic diversification. Success in new product launches and expansion in the U.S. market remain ongoing priorities.
Quarterly Highlights: Performance, Progress, and Product Moves
Revenue growth was a central achievement, with reported GAAP revenue of $24.1 million -- up 89.4% year over year and 27.7% sequentially. This marked the sixth quarter of consecutive sequential increases. The EMEA region led the way, representing 76% of revenue, with strong distributor uptake and robust demand for MLPE products. In contrast, the U.S. market accounted for 17% of sales and remained flat, raising both opportunity and concentration risks for the business.
The company shipped 646,000 MLPE units, equivalent to 477 megawatts, surpassing the 502,000 units (351 MW) delivered in Q1 2025, thanks to the versatility and power rating of the upgraded TS4-A optimizer. This latest optimizer comes in power ratings of 700, 725, and 800 watts, supporting a wide range of market segments and ensuring backward compatibility. Management has emphasized the value of installation speed and ease -- citing a 10-second-per-module install time -- as a key reason for market share gains among installers and distributors.
Gross profit increased by approximately 2.8 times compared to the year-ago period. The gross margin rose to 44.7%, up from 30.4% previously. This margin expansion resulted from a combination of higher unit value (due to new, higher-wattage optimizers) and stable pricing. Operating expenses remained flat year over year at $12.3 million, which, together with rising revenue, helped the company swing to positive adjusted EBITDA (non-GAAP) of $1.1 million -- an improvement versus a $6.4 million loss in Q2 2024. The net loss (GAAP) narrowed significantly to $4.4 million, compared to an $11.3 million loss in Q2 2024, but the company is not yet profitable on a GAAP basis.
In terms of regional sales, management reported that its U.S. performance was stable but lagged EMEA. EMEA now makes up more than three-quarters of revenue, underscoring both the company’s success overseas and the need for geographic diversification. The U.S. business could offer growth potential if efforts to boost sales and offset tariff exposure pay off in future quarters. Tigo has further mitigated risk by sourcing products for the U.S. market from outside China and relying on manufacturing in Thailand. As a result, the backlog for Q3 was already higher than Q2 revenue reported, suggesting some positive momentum heading into the next period.
Looking Ahead: Guidance and Watchpoints
Management raised its full-year 2025 revenue forecast to $100 million to 105 million (GAAP), up from a prior range of $85 million to 100 million. The company now anticipates Q3 2025 revenue of $29million to $31 million and positive adjusted EBITDA of $2 million to $4 million. There is also the potential for a GAAP operating profit if the business meets the high end of its outlook. Growth is expected to be led by continued strength in EMEA and steady MLPE sales.
Despite improving margins and adjusted EBITDA profitability, Tigo Energy faces critical risks related to its debt structure and ongoing operating losses. The $45.0 million short-term convertible debt maturing in early 2026 remains a material item to monitor, as reported on the balance sheet as of June 30, 2025. Management is working to refinance this obligation but flagged the issue as a “going concern” risk in filings. Cash and short-term investments totaled $28.0 million at quarter end, a sequential increase of $7.7 million from the first quarter of 2025. No dividend is currently offered by Tigo Energy. Investors should monitor the company’s execution on U.S. market growth, debt refinancing, and supply chain resiliency as the year progresses.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
