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SunPower Falls After Halt to Solar Installations and Shipments
(Bloomberg) — SunPower Corp. slumped to a record low after the solar company told dealers it would no longer support new installations and was halting shipments.
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“They’re basically saying they’re not able to continue operations,” Pol Lezcano, an analyst at BloombergNEF, said in an interview.
Shares fell 40% to $1.51 at the close in New York, the biggest decline on record, making them the second-worst performer on the Nasdaq Composite. The company has lost more than two-thirds of its market value this year as it grapples with a decline in the rooftop solar industry as well as internal problems.
SunPower has notified dealers that, effective Sept. 17, it will “no longer support new PPA leases and sales, nor new project installations,” according to a letter that was included in a research note from Roth MKM. “All new shipments and project installations will be halted.”
The company may have “hit a wall,” Roth analyst Philip Shen wrote in a Thursday note.
“We continue to devote our attention to addressing our financial position and are actively working to navigate our current challenges,” the company wrote in an email. SunPower confirmed the contents of the letter cited in Shen’s note.
It’s unclear how long the facility suspension will persist, and researchers at JPMorgan Chase & Co. said the situation may not be resolved quickly.
“We do not believe this is a temporary shutdown, but rather an indefinite suspension of SPWR’s future business,” analysts led by Mark Strouse wrote in a research note, referring to the company’s ticker.
The warning comes after the company said in April it needs to restate nearly two years of financial results. It also replaced its chief executive officer and chief operating officer, defaulted on a credit agreement due in late 2023 after an earlier earnings review and is battling a drop in installations in California — its home state and the nation’s largest solar market.
French energy giant TotalEnergies SE owns about 65% of SunPower. SunPower’s decision to halt operations is an indication that the company’s problems have deepened, Lezcano said.
“This is their livelihood,” he added. “It looks pretty bad.”
(Updates stock price in third paragraph.)
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