First Solar Authorizes $500 Million Share Buyback and Cuts 2026 Guidance
Key Facts
On October 29, 2026, First Solar authorized a program to repurchase up to $500 million of its common stock, while lowering its 2026 sales and sales volume forecasts, according to a company filing with the U.S. Securities and Exchange Commission. The authorization is effective immediately but does not obligate the company to buy any shares and has no specified expiration date. The company said the move reflects its confidence in the long-term value of its business while maintaining a disciplined approach to capital allocation. It added that this approach allows it to continue investing in technology development and growth. The decision comes as third-quarter results show declining revenue alongside higher net income and adjusted EBITDA.
The company reported net sales of $1.23 billion in the third quarter, down 23% from the same period in 2025, attributing the decline mainly to lower third-party sales volume. Net income, by contrast, rose to $571 million, or $5.30 per diluted share, from $456 million and $4.24 per share a year earlier. Adjusted EBITDA also increased to $744 million from $671 million. The chief executive said gross margin was about 58%, up nearly 20 percentage points year on year. He attributed the improvement mainly to a higher share of U.S.-manufactured modules, with additional benefit from lower cancellation rates and underutilization costs, partly offset by a negative impact from lower contract termination revenue.
First Solar cut its 2026 sales volume forecast to 16.0–17.0 gigawatts from 17.0–18.2 gigawatts previously, and lowered its net sales forecast to $4.6–$4.9 billion from $4.9–$5.2 billion. The adjusted EBITDA range was reduced to $2.55–$2.75 billion, compared with a previous forecast of $2.6–$2.8 billion. Management attributed the revisions to expected lower sales in the domestic Indian market, international Series 6 products and U.S. finishing sales. It lowered its estimate for domestic sales in India by about 0.7 gigawatts. It also cut its 2026 capital expenditure forecast to $0.6–$0.8 billion from $0.8–$1.0 billion, citing the deferral of some project spending.
Net cash fell to $1.5 billion on September 30, 2026, from $2.4 billion on December 31, 2025. The company attributed the decline to working capital requirements and capital spending. Collections of Section 45X credits and IEEPA duty refunds partly offset the impact. On sales, the company booked additional gross U.S. orders of about 1.4 gigawatts since its previous earnings call, at an average price of about $0.36 per watt, including technology adjustments. Most of this volume was contracted or in advanced negotiations, while pricing and terms were largely set before the Section 232 announcement.
Chief Executive Mark Widmar said, "Section 232 represents a structural shift in the U.S. approach to solar manufacturing," adding that the company believes it is well positioned to benefit from the new environment. U.S. bookings since the start of the year totaled about 4.9 gigawatts, at an average price of $0.35–$0.36 per watt, including adjustments. In addition to bookings, the company disclosed about 4 gigawatts of variable volumes tied to previously signed contracts, which are not currently included in contracted backlog. Decisions on about half of these volumes are due within the five months following the call. This makes customers' decisions on variable volumes important to tracking contracted sales in the coming period.
Module sale backlog stood at 44.0 gigawatts on September 30, with a total contract value of $13.5 billion and revenue expected to be recognized through 2030 as control of the modules transfers to customers. The figure excludes contracts in India for which payment has not been fully secured. The backlog includes 20.0 gigawatts of modules subject to potential price adjustments resulting from future technology improvements. Additional revenue from those adjustments could reach $0.5 billion, with most expected to be recorded in 2027 and 2028. This additional consideration remains contingent on the technology improvements specified in the contracts being achieved.
For the fourth quarter, the company expects to sell 4.3–5.3 gigawatts of modules, including 3.4–4.3 gigawatts from U.S. manufacturing operations. It estimated adjusted EBITDA for the period at $643–$843 million. Management expects to make a long-term operating decision on the Malaysia facility in the first half of 2027. It said the two options are to operate the facility at full or near-full capacity of 1.8 gigawatts annually, or to cease production. These upcoming milestones set the near-term course for tracking the company's performance and operating decisions.