First Solar Q2 2026 Earnings Show Margin Strength

First Solar’s Q2 2026 earnings on July 30 showed mixed operating results, with record volumes and a profit surge that led management to reaffirm full-year guidance. Meanwhile, multiple law firms filed securities class-action notices, creating a legal overhang for investors.

Q2 Results and Guidance

First Solar reported net sales of $1.06 billion for the quarter ended June 30, 2026, a 4% decline year over year. The drop reflected lower revenue from customer contract terminations, partly offset by higher module volumes sold to third parties. Net income rose to $423 million, or $3.92 per diluted share, exceeding Street consensus estimates that ranged between $2.74 and $3.01. Adjusted EBITDA reached $644 million, with an adjusted-EBITDA margin near 61%.

Management said gross margin was about 57%, driven by tariff-related benefits and higher domestic content, while operating margin stood around 42–43%. The company highlighted a contracted sales backlog of 45.1 gigawatts through 2030 and cumulative module sales exceeding 100 gigawatts globally, underscoring multi-year demand visibility. It emphasized disciplined contracting and U.S. manufacturing expansion as key supports for margin durability.

On the balance sheet, First Solar held $1.7 billion in net cash at June 30, down from $2.4 billion at year-end 2025. Free cash flow was negative $306 million for the quarter, compared with negative $139 million a year earlier, reflecting seasonal working-capital needs and capital spending tied to the South Carolina finishing facility.

The company reaffirmed full-year 2026 net-sales guidance in a range of $4.9 billion to $5.2 billion and cited an adjusted-EBITDA midpoint near $2.7 billion. It set Q3 expectations for module sales of 3.9 to 4.5 gigawatts and adjusted EBITDA between $625 million and $775 million.

Securities Class-Action Filings

On July 28, multiple law firms filed securities class-action notices and a complaint against First Solar and certain officers. Pomerantz LLP filed suit in the U.S. District Court for the Eastern District of New York (Case No. 26-cv-03787), with parallel notices from Robbins LLP, Levi & Korsinsky, and others. The class period runs from February 26, 2025, through February 24, 2026, with an August 24 lead-plaintiff deadline.

The complaints allege violations of Sections 10(b) and 20(a) of the Exchange Act and SEC Rule 10b-5. They claim the company overstated its ability to manage the effects of changing U.S. tariff policies, understated the financial impact of reducing production in Malaysia and Vietnam, and failed to disclose risks related to relocating production to the U.S.

The filings cite two corrective events linked to investor losses: a January 7, 2026 disclosure that triggered a roughly $27.67 per-share decline, and a February 24 press release reporting Q4 2025 and full-year 2025 results along with lower-than-expected 2026 revenue guidance. Following the February 24 release, shares fell $33.09 per share (about 13.6%), closing at $210.12 on February 25, as noted in the complaints.

One notice names the CEO and CFO as individual defendants under Section 20(a) control-person claims, alleging they directed misleading statements on tariffs and production. These filings represent private federal securities actions; there is no indication of related SEC or DOJ enforcement proceedings in the available materials.

The complaint alleges that First Solar “overstated its ability to manage the effects of changing U.S. tariff policies,” understated the financial impact of production reductions, and failed to disclose risks tied to onshoring operations.