10-QPeriod: Q2 FY2026

FIRST SOLAR, INC. Quarterly Report for Q2 Ended Jun 30, 2026

Filed July 30, 2026For Securities:FSLR

Summary

First Solar, Inc. reported strong financial performance for the six months ended June 30, 2026, with net sales increasing by 8.2% to $2.1 billion compared to the same period in 2025. This growth was primarily driven by a 16.8% increase in module volume sold. Despite a 3.7% decrease in net sales for the three months ended June 30, 2026, attributed to customer contract terminations, the company demonstrated significant operational improvements. Gross profit margin expanded substantially to 57.3% in the second quarter of 2026 from 45.6% in the prior year, benefiting from expected tariff refunds, increased eligibility for advanced manufacturing tax credits, and lower logistics costs. Profitability also saw a considerable boost, with net income for the six months ended June 30, 2026, rising to $769.2 million from $551.4 million in the prior year. The company continues to invest heavily in research and development, with R&D expenses increasing by 34.0% year-over-year, reflecting its commitment to technological advancement and cost reduction in its thin-film PV technology. First Solar also continues to expand its domestic manufacturing capacity, highlighting its strategic focus on U.S.-based production. The company maintains a solid liquidity position, with approximately $1.7 billion in cash, cash equivalents, and marketable securities as of June 30, 2026.

Key Highlights

  • 1Net sales for the six months ended June 30, 2026 increased by 8.2% to $2.1 billion, driven by a 16.8% increase in module volume sold.
  • 2Gross profit margin significantly improved, reaching 57.3% for the three months ended June 30, 2026, compared to 45.6% in the same period of 2025, due to tariff refunds, manufacturing credits, and lower logistics costs.
  • 3Net income for the six months ended June 30, 2026, grew to $769.2 million, up from $551.4 million in the prior year.
  • 4Research and Development expenses increased by 34.0% for the first six months of 2026, reflecting ongoing investment in technology and product improvement.
  • 5The company is actively expanding its U.S. manufacturing footprint, with plans for a sixth facility.
  • 6First Solar repaid its India Credit Facility in May 2026, reducing interest expenses.
  • 7The company maintains a strong liquidity position with $1.7 billion in cash, cash equivalents, and marketable securities as of June 30, 2026.

Frequently Asked Questions

The substantial increase in gross profit margin for the three months ended June 30, 2026, was primarily driven by an $88.6 million net benefit related to expected IEEPA tariff refunds less estimated amounts payable to customers, a higher volume of modules qualifying for the advanced manufacturing production credit under Section 45X of the IRC, and lower logistics costs. These factors were partially offset by lower revenue from customer contract terminations and higher duties and tariffs.

First Solar is significantly increasing its investment in research and development, with R&D expenses rising by 34.0% in the first six months of 2026. This investment supports its technology roadmap, including advancements in bifacial modules, the CuRe program for improved performance, and ongoing research into perovskite thin-film technology. Additionally, the company is expanding its domestic manufacturing capacity with plans for a sixth U.S. facility, demonstrating a commitment to onshore production.

Government policies, such as tariffs and tax credits like the IRA's Section 45X manufacturing credit, have a significant impact. While Section 45X is currently beneficial, creating demand for domestically manufactured modules, other tariffs and trade remedies can increase costs and disrupt supply chains. The company is actively monitoring and advocating for favorable trade policies. Recent developments include expected IEEPA tariff refunds which positively impacted gross profit, but ongoing trade policy changes present both opportunities and risks.

As of June 30, 2026, First Solar maintained a strong liquidity position with $1.7 billion in cash, cash equivalents, and marketable securities. The company repaid its India Credit Facility in May 2026, reducing its debt obligations and interest expense. First Solar also has significant availability under its Credit Facility and various factoring arrangements. The company expects its current resources and anticipated cash flows to be sufficient for its working capital and capital expenditure needs for at least the next 12 months.