SolarCity: Lower Q2 Loss than Expected, Increased Customer Base

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While First Solar had lower-than-expected Q2 earnings, SolarCity (SCTY) today reported a lower-than-expected Q2 net loss per share.

The loss was still double that of that a year earlier, although the company’s customer base also doubled. But increasing expenses masked a larger revenue.

In the second quarter of 2014, SolarCity said it continued to “build out a stronger and broader platform to significantly expand solar.” The company said that unprecedented demand in the quarter led to triple-digit year-over-year growth in all key operating metrics.

Solarcity deployed 107 MW and booked 218 MW in Q2, and passed the 140,000-customer mark in June 2014 with more than 30,000 customers added in Q2. That represents an increase of 218% over the same quarter last year.

One thing that could be an issue for the company is that it’s counting on an expanding base of leased solar assets to support a meaningful level of operating lease revenue for the next 20 years. The Motley Fool points out that with loans becoming more available and attractive to consumers, some of that revenue might be eroded. The Fool notes, “About 35% of the $1.29 billion in retained value SolarCity says it has from leased systems comes from renewing leases after 20 years. If a system is sold to a homeowner that long-term value goes to the homeowner.”

A lot remains to be seen in this ever-changing market.

Highlights of Q2 for SolarCity:

  • MW deployed of 107 MW, up 102% year-over year (with residential MW deployed up 111% year-over-year to 90 MW). Total cumulative MWs deployed reached 756 MW as of June 30, 2014.

  • MW booked totaled 218 MW, up 216% as compared to Q2 2013.

  • Cumulative energy contracts increased to 128,933, up 114% since the end of the second quarter of 2013 (and 28% since the end of the first quarter 2014).

  • Cumulative customers grew to 141,034, up 102% since the end of the second quarter of 2013 (and 27% since the end of the first quarter 2014).

 

The company says its deployed solar power systems are now capable of producing over 1000 GWh annually, with its aggregate portfolio having produced more than 3.5 GWh per day several times before the end of Q2. SolarCity also says it’s firmly on track to achieve its goal of 500 MW – 550 MW deployed in 2014 and 900 MW – 1000 MW in 2015.

SolarCity estimates it will end next year with more than 2 GW of cumulative deployments and annualized electricity production of  about 2.8 terawatt-hours — putting the company “on a path to fulfill our goal to become one of the largest suppliers of electricity in the United States.”