$ENPH · Enphase Energy, Inc.
Enphase Energy filed its Q3 FY2026 10-Q, reporting net revenues of $293.3M, down 28.5% YoY from $410.4M. Gross margin compressed to 43.3%. Income from operations cratered to $6.5M from $66.2M. Net income was $23.4M ($0.17 diluted EPS), down from $66.6M ($0.50) a year ago, saved only by a $27.0M income tax benefit. For the nine months, revenue fell 23.2% to $868.1M and net income dropped 61% to $52.1M.
- Q3 net revenues fell 28.5% YoY to $293.3M from $410.4M.
- Income from operations dropped 90% to $6.5M vs $66.2M a year ago.
- Other expense, net swung to a $26.6M loss from $3.7M, driven by fair value declines in debt securities and tax equity fund.
- Nine-month net income fell 61% to $52.1M from $133.4M.
- Cash and marketable securities declined $581M from year-end 2025 to $931.8M, partly due to $632.5M convertible note settlement.
Stock flat in extended hours at $29.76 despite the steep revenue and profit declines, suggesting the weakness was largely priced in. The $3.93B market cap still implies a rich multiple on sharply reduced earnings power.
Enphase's 90% operating income collapse and 28.5% revenue decline confirm the residential solar downturn is deepening, not recovering.
Enphase's 28.5% revenue contraction mirrors the broader residential solar downturn driven by high interest rates and policy uncertainty. Peer SolarEdge also reported steep YoY declines, confirming the demand environment remains hostile for distributed solar equipment makers.
Revenue concentration risk: the 28.5% YoY revenue decline signals sustained demand weakness in residential solar. The $26.6M "other expense, net" line includes fair value losses on debt securities and tax equity fund investments, exposing the company to mark-to-market volatility beyond operations. The $632.5M convertible note repayment drained significant liquidity.