First Solar (NASDAQ: FSLR) earnings per share rise 25% as sales fall and outlook dips

What happened

First Solar, Inc. (NASDAQ: FSLR) reported third-quarter earnings of $5.30 per diluted share on Oct. 29, up 25% from $4.24 a year earlier. Net sales fell 23% to $1.23 billion, mainly because it sold fewer modules to third parties.

Net income was $571 million, up from $456 million in the third quarter of 2025. Adjusted EBITDA rose 11% to $744 million from $671 million. The company also lowered parts of its 2026 outlook and authorized a buyback of up to $500 million.

Key numbers

Metric	Latest	Change	Source
Net sales, Q3 2026	$1.23 billion	from $1.59 billion, -23%	SEC 8-K, Exhibit 99.1
Net income per diluted share, Q3 2026	$5.30	from $4.24, +25%	SEC 8-K, Exhibit 99.1
Adjusted EBITDA, Q3 2026	$744 million	from $671 million, +11%	SEC 8-K, Exhibit 99.1
Gross profit, Q3 2026	$713.06 million	from $610.75 million, +16.8%	Calculated from SEC 8-K, Exhibit 99.1
Net cash balance, Sept. 30, 2026 (year-end 2025 comparison)	$1.5 billion	from $2.4 billion	SEC 8-K, Exhibit 99.1
Share repurchase authorization (cap)	up to $500 million		SEC 8-K, Item 8.01

Read more: First Solar (FSLR) company research

Why it matters

OptimistFi has argued that First Solar works if its U.S.-anchored module franchise stays a scarce, bankable alternative to commodity silicon supply. It must also grow without giving back margin and cash-flow gains. The quarter supports the margin half of that view.

By OptimistFi's calculation, gross profit rose 16.8% to $713.06 million from $610.75 million. Cost of sales dropped to $517.88 million from $984.11 million. The release shows an Adjusted EBITDA margin of 60%, up from 42%, and a net income margin of 46%, up from 29%.

Net income also included a $5.03 million income tax benefit, against a $4.40 million tax expense a year earlier. Chief Executive Officer Mark Widmar called Section 232 a structural change in how the United States approaches solar manufacturing. He said the company is "structurally positioned to benefit from this environment."

Stock perps: every US stock that trades as a perpetual future, by leverage, live

What changed in the 2026 outlook

Management lowered four of its seven full-year ranges. Volume sold now runs 16.0 GW to 17.0 GW, down from 17.0 GW to 18.2 GW. Net sales guidance is $4.6 billion to $4.9 billion, down from $4.9 billion to $5.2 billion.

Adjusted EBITDA guidance fell to $2.55 billion to $2.75 billion from $2.6 billion to $2.8 billion. Capital expenditures guidance fell to $0.6 billion to $0.8 billion from $0.8 billion to $1.0 billion. Gross profit, operating expenses ($610 million to $635 million) and net cash ($1.7 billion to $2.3 billion) are unchanged.

The gross profit range assumes $2.07 billion to $2.19 billion of Section 45X tax credits. The outlook also assumes the current U.S. policy environment holds and permitting timelines match historical levels. Contracted sales backlog was 44.0 GW at Sept. 30.

Cash, working capital and the buyback

The cash half of the case looks weaker this quarter. Net cash fell to $1.5 billion at Sept. 30 from the year-end 2025 level. The company cited working-capital needs and capital spending, mostly on U.S. facilities. Section 45X cash receipts and IEEPA tariff refunds partly offset the drop. Gross cash was $1.6 billion.

Over the first nine months, operations used $402.71 million of cash, against $815.21 million provided a year earlier. Long-term government grants receivable stood at $1.59 billion, up from $125.61 million at year-end. The cash flow statement shows a $1.29 billion outflow tied to those receivables.

The buyback is a cap, not a purchase. The board set no expiration date and no duty to buy any amount. The company picks the timing and size, and it may suspend or end the program at any time.

What's next

First Solar's fourth-quarter 2026 results are the next test. The company expects module sales of 4.3 GW to 5.3 GW, including 3.4 GW to 4.3 GW from U.S. manufacturing. It expects Adjusted EBITDA between $643 million and $843 million.

Results inside those ranges, with year-end net cash inside the guided range, would support the case that margins and cash can hold as capacity grows. Volume below 4.3 GW or Adjusted EBITDA under $643 million would add to the pressure shown by this quarter's sales decline.

More from OptimistFi

• FSLR stock: research and coverage of First Solar
• Stock research on every company OptimistFi covers

From OptimistFi Perps