What happened 

Shares of solar manufacturer SunPower Corp. (NASDAQ:SPWR) fellen as much as 20.8% in trading Wednesday morning after the company reporting second quarter earnings. At 11:55 a.m. EDT shares were trading at their low for the day, and didn't look they'd be recovering much anytime soon. 

So what

Oddly enough, SunPower beat its own guidance on every major metric. Most notably, GAAP revenue was $337.4 million, ahead of the $275 million to $325 million guidance range, and adjusted EBITDA was $13.5 million, well better than what was forecast by management -- a range of breakeven to a $25 million loss. Margins were up, demand was strong, and the company even said it expects to sell all the solar panels it can make in 2017. 

A utility scale solar installation in a grassy field.

Image source: SunPower.

What the market latched onto on Wednesday, though, was a revised guidance range that was at the low end of previous guidance. Revenue is now expected to be $2.1 billion to $2.3 billion, with deployments of 1.3 GW to 1.45 GW. The high end of revenue guidance was down $300 million and the top end of deployments guidance was down 150 MW. 

Now what

Most of the guidance reduction was due to a delay that will push a project in Mexico into the first half of 2018. That project is still going to be completed as planned, so there's no fundamental change long term, but it does make this year's guidance a little disappointing. 

What's more important for long-term investors is that margins are rising and SunPower is moving forward with the sale of its stake in the yieldco 8point3 Energy Partners. The yieldco sale will bolster its balance sheet, and lower manufacturing costs and improved products should help improve financial performance in the long term. The weak guidance may be the market's focus today, but project delays are a normal part of the solar business. I would put more emphasis on SunPower's improving financials and balance sheet. 

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