SolarEdge Announces Fiscal Fourth Quarter and Year End 2016 Financial Results

SolarEdge Technologies, Inc. (Nasdaq: SEDG), a global leader in PV inverters, power optimizers, and module-level monitoring services, today announced its financial results for the fiscal fourth quarter and year ended June 30, 2016.

Fourth Quarter and Full Fiscal Year 2016 Highlights

• Revenues for fiscal Q4 2016 of $124.8 million, and $489.8 million in fiscal year 2016
• GAAP gross margin for fiscal Q4 2016 of 31.4% and 31.0% for fiscal year 2016
• GAAP net income for fiscal Q4 2016 of $17.3 million and $76.6 million for fiscal year 2016
• Non-GAAP net income for fiscal Q4 2016 of $19.9 million and net income of $79.3 million for fiscal year 2016
• GAAP net diluted earnings per share for fiscal Q4 2016 of $0.39 and $1.73 for fiscal year 2016
• Non GAAP net diluted earnings per share for fiscal Q4 2016 of $0.44 and $1.74 for fiscal year 2016
• 427 Megawatts (AC) of inverters shipped for fiscal Q4 2016 and 1,615 Megawatts (AC) for fiscal year 2016

“Our fiscal 2016 results demonstrate consistent and strong execution with record revenues and 51% annual growth. We maintain our profitability and continue to generate cash flow from our operations, quarter over quarter. While this quarter is characterized by a general slowdown in the residential U.S market, we were able to compensate with increased sales in other geographic regions in which we sell,” said Guy Sella, Founder, Chairman and CEO of SolarEdge. “We remain on target with our plans to grow our business and increase market share without sacrificing gross margins and profitability.”

Fourth Quarter 2016 Summary
The Company reported revenues of $124.8 million for fiscal Q4 2016, a decrease of 0.4% from the prior quarter and increase of 26.8% from fiscal Q4 2015.

GAAP gross margin reached 31.4% for fiscal Q4 2016, down slightly from 32.5% in the prior quarter and up from 28.7% in fiscal Q4 2015.

Non-GAAP gross margin was 31.6% for fiscal Q4 2016, down slightly from 32.7% in the prior quarter and up from 28.9% in fiscal Q4 2015.

GAAP operating expenses were $21.2 million for fiscal Q4 2016, consistent with $21.0 million, from the prior quarter and an increase from $16.4 million in fiscal Q4 2015.

GAAP operating income was $17.9 million for fiscal Q4 2016, down from $19.7 million in the prior quarter and up from $11.9 million in fiscal Q4 2015.

GAAP net income was $17.3 million for fiscal Q4 2016, down from $20.8 million in the prior quarter and up from $9.3 million in fiscal Q4 2015.

Non-GAAP net income was $19.9 million for fiscal Q4 2016, a decrease from $23.3 million in the prior quarter and an increase from $13.8 million in fiscal Q4 2015.

GAAP net diluted earnings per share (“EPS”) was $0.39 for fiscal Q4 2016, down from $0.47 in the prior quarter and up from $0.21 in fiscal Q4 2015.

Non-GAAP net diluted EPS was $0.44 for fiscal Q4 2016, a decrease from $0.51 in the prior quarter and an increase from $0.31 in fiscal Q4 2015.

As of June 30, 2016, cash, cash equivalents, restricted cash and marketable securities totaled $186.6 million, compared to $172.2 million on March 31, 2016. As of June 30, 2016, the Company did not have any debt.

Full Fiscal Year 2016 Summary
For the full fiscal year 2016, the Company reported:

• Revenue of $489.8 million, representing a 50.7% increase from fiscal year 2015
• Gross margin of 31.0%, compared to 25.2% in fiscal year 2015
• Operating expenses of $80.2 million, up 49.8% from fiscal year 2015
• Operating income of $71.8 compared to $28.3 million in fiscal year 2015
• GAAP net income of $76.6 million, compared to $21.1 million in fiscal year 2015
• Non-GAAP net income of $79.3 million, compared to $29.4 in fiscal year 2015
• GAAP net diluted EPS of $1.73, compared to $0.27 in fiscal year 2015
• Non-GAAP net diluted EPS of $1.74, compared to $0.77 in fiscal year 2015

Outlook for the First Fiscal Quarter 2017
The Company also provides guidance for the first fiscal quarter of 2017 as follows:

• Revenues to be within the range of $130 million to $139 million;
• Gross margins to be within the range of 30% to 32%.