SunPower (SPWR -1.85%) announced another blowout quarter, but investors don't quite know how to interpret the latest results. Fourth-quarter GAAP revenue was down 6% to $638.1 million because of a changing mix of lease, module sales, and project sales than a year ago. What's encouraging is that gross margin was up to 20.5% from 6.9% a year ago, and earnings were $0.15 per share.
On a non-GAAP basis, which accounts for systems as they're built and not based on GAAP accounting rules, revenue was $758.2 million, gross margins were 20.4%, and earnings were $0.47 per share. On that basis, analysts were expecting $708.0 million in revenue and $0.28 per share in earnings, so the company outperformed expectations once again.
Once again, SunPower ran its fabrication facilities at full strength and made progress on a new 350 MW plant that will begin putting out product in about a year. Management even hinted at its next fabrication expansion that will be a "much larger scale" than 350 MW.
The hole that investors may look at is only 13 MW of solar leases added, well below competitors like SolarCity. The market loves the solar lease right now, and SunPower isn't as large in this market as SolarCity, which is a downside for now.
Solar demand remains high across residential, commercial, and utility scale markets, and SunPower is one of only a few profitable solar manufacturers in the world. That demand, along with the most efficient panels in the industry, set up the company for future growth once new manufacturing plants start churning out products next year.