Shares of solar giant First Solar, Inc. (NASDAQ:FSLR) fell as much as 10% Friday after the company reported third-quarter financial results and lowered guidance for the full year. There was a decent recovery during the session, and by 1:20 p.m. EDT, the stock was only down 4.4%.
First Solar's revenue fell 38% versus a year ago to $676.2 million and net income dropped 71.9% to $57.8 million, or $0.54 per share. Revenue fell slightly short of the $684 million that analysts were expecting, but earnings beat estimates of $0.45 per share.
What really surprised investors was management reducing revenue guidance for the full year by $200 million to $2.3 billion-$2.4 billion and earnings guidance from $1.50 to $1.90 per share to a range of $1.40 to $1.60 per share. Some of the reduction was due to the timing of project sales, but most was because of a decline in solar panel sales versus previous expectations.
First Solar hasn't been immune to a decline in solar demand in China and around the world in 2018. Commodity solar panel prices have plunged by about one-third and First Solar is feeling the pinch in both volumes and sale prices, which management said declined 10% versus a quarter ago. Given the weak macro conditions in the solar industry and First Solar's reduced guidance, it could be a long road to consistent top- and bottom-line growth.