What happened
One of the big winners in the market today is utility-scale solar-tracker technology company Array Technologies (ARRY 0.93%). Shares soared nearly 30% and remained higher by 27.4% as of 11:50 a.m. ET.
So what
The massive stock move came after the company blew away estimates with its second-quarter financial report. The New Mexico-based company reported a $52 million profit -- or $0.34 per share -- in the quarterly period on sales of $508 million.
Analysts, on average, expected sales of just $449 million, with the company expected to report earnings of just $0.05 per share, according to FactSet Research. The results were also a notable reversal in profitability compared to the loss of $0.10 per share it reported in the year-ago quarter.
Now what
Some investors might wonder why the stock reacted as positively as it did, considering Array lowered its outlook for full-year 2023 revenue. The company now sees sales in the range of $1.65 billion to $1.725 billion. That's down from the $1.8 billion to $1.9 billion it expected just three months ago.
But two other important metrics are going in the right direction. Despite lowering revenue guidance -- which the company said was due to pushing out booking of some project deliveries to 2024 -- Array sees higher profitability this year than it previously expected.
Predictions for adjusted income and EBITDA (earnings before interest, taxes, depreciation, and amortization) were raised meaningfully. Array also has now generated $57 million of free cash flow in the first half of 2023, bringing its cash balance to $156 million as of June 30.
Improving cash flow and profitability will help the company reduce its debt and are signs the business is operating efficiently. That helps explain the bounce in Array shares today.
