Oct 27, 2026 earnings call — Focus on batteries, Propel, commercial and SST
Enphase reported Q3 revenue of $293.3 million and guided Q4 revenue between $225 million and $255 million including $51.2 million safe harbor.
Revenue $0.3B (est $0.3B) · EPS $0.41 (est $0.51)
Key quotes
"Our first growth driver is residential batteries. Global adoption continues to accelerate driven by demand for energy resilience, self-consumption and VPP."
"Propel is now available in 13 states and installer participation has grown to approximately 350 as compared to 290 in Q2."
"IQ SST is designed to convert 13.8 kV or 34.5 kV medium-voltage AC directly into regulated 800 VDC through our modular single-stage architecture."
Analyst Q&A 11
Q4 undershipment and Q1 impact
Q (Brian Lee · Goldman Sachs): Analyst asked if 4Q guidance includes a $20 million under shipment and how that affects implied revenue and Q1 seasonality and outcomes given new products and markets.
A: Management said global sell-through was roughly $230 million per quarter, they expect a 10% reduction to about $210 million in Q4 and will under ship $20 million into the channel to $190 million; core revenue has been about $200 million per quarter and they outlined growth drivers that could add to 2027.
"So let me just give you the full color. Basically, what we have -- what we said is that our global sell-through in the first 3 quarters of this year has been kind of flat at roughly $230 million a quarter." — Badrinarayanan Kothandaraman (CEO)
Market outlook and battery price cut
Q (Philip Shen · ROTH Capital Partners): Analyst asked about 2027 resi solar market weakness and downside risk to the $200 million per quarter baseline, and also asked how much battery list prices were lowered and the margin impact.
A: Management said today's market is weak due to higher interest rates and unclear FEOC guidance, so they focus on growth drivers independent of market. They said they reduced U.S. battery list prices to distributors and aim for a company gross margin target of 40% over time.
"We -- this change was done a couple of months ago where we basically reduced the list price of our batteries in the U.S. by approximately, I would say, by approximately 8% to 9% to distributors." — Badrinarayanan Kothandaraman (CEO)
Storage outlook and EV OEM locations
Q (Eric Stine · Craig-Hallum): Analyst asked if management's storage optimism changed since last quarter and whether France is the main weak spot; also asked where the three EV OEM partners are located.
A: Management said short-term weakness is mainly in the U.S. due to interest rates, but long-term opportunity remains with fifth-generation battery and international markets; they confirmed the three EV OEM engagements are in the U.S. and there is one ongoing in Europe.
"Yes. I think in general, in the short term, we are seeing weaknesses in the U.S. primarily due to interest rates in the short term." — Badrinarayanan Kothandaraman (CEO)
Price elasticity and Netherlands friction
Q (Colin Rusch · Oppenheimer): Analyst asked how much demand elasticity they've seen from the recent battery price cuts and why Netherlands demand hasn't materialized as expected.
A: Management said it is too soon to judge elasticity after the price change. They said Netherlands customers wait until they see higher electricity bills, and Enphase is running homeowner events, webinars, targeting non-Enphase solar homes and expects Gen 5 to improve install cost and adoption.
"Yes, customers aren't going to react until they see their electricity bill." — Badrinarayanan Kothandaraman (CEO)
SST $1 billion by 2030 reasoning
Q (Mark W. Strouse · JPMorgan): Analyst asked how management derived the ~ $1 billion revenue opportunity for SST by 2030 and whether that was top-down or bottoms-up.
A: Management explained SST is based on their large microinverter power module, GaN technology, and modular design; they cited 11 to 30+ gigawatts possible market scenarios, then assumed a reasonable market share and price to arrive at the $1 billion by 2030 figure.
"So we looked at those numbers. We took what we assume would be a reasonable market share and at a price that we think is the right price and came up with that $1 billion number by 2030." — Raghuveer Belur
Europe trends and bidirectional chargers
Q (Dylan Nassano · Wolfe): Analyst asked why core residential solar in Europe isn't stronger and how Enphase's bidirectional EV charger compares to bidirectional EVs.
A: Management said Europe saw seasonal pullback after an earlier spike, and batteries are the big Europe opportunity where Gen 5 should help. They said they will have both AC and DC bidirectional charger solutions and expect volume shipping in Q1 '27 with engagements with top 3 U.S. OEMs.
"We will have solutions for both, and they will be shipping in volume in Q1 '27." — Badrinarayanan Kothandaraman (CEO)
Election tax credits and U.S. manufacturing
Q (Corinne Blanchard · Deutsche Bank): Analyst asked whether midterm election outcomes and possible tax credit extensions change their manufacturing strategy in the U.S.
A: Management said there is bipartisan discussion about extending investment and production tax credits which could help renewables. They also said they have the manufacturing capacity they need now and would not hesitate to scale U.S. manufacturing when SST or other products ramp.
"So we won't hesitate we won't hesitate to scale U.S. manufacturing." — Badrinarayanan Kothandaraman (CEO)
SST hyperscaler relationships and pilots timing
Q (Carter Goman · Jefferies): Analyst asked for color on hyperscaler and AI customer relationships for SST and when pilots could start after megawatt demos and compliance.
A: Management said they won't disclose customer details but hyperscalers are working closely, have visited labs and given input. They expect to complete compliance in the first half of next year and then begin pilots in the second half, aiming for commercial production close to end of year or early 2028.
"We expect that in the second half, we should start -- we should be through our compliance by the first half of year and then heading to pilots in the second half." — Raghuveer Belur
Hyperscaler commitments and development
Q (Sunaina Ocalan · Bernstein): Analyst asked whether hyperscaler commitments are technical evaluations or include funded development and whether they require different designs.
A: Management said the development and IP are Enphase's; they discuss test plans and specific requirements with hyperscalers but so far are keeping interactions technology-focused while business discussions continue. They did not say hyperscalers fund development or take ownership of IP.
"This is our own development. But we do talk to them about testing, test plans, et cetera." — Raghuveer Belur
Q4 cash flow and France impact
Q (Jonathan Kees · Daiwa): Analyst asked about Q4 cash flow and working capital drivers for the cash burn, and whether recent riots in France have disrupted installer outreach and product rollouts.
A: Mandy said they expect a sizable free cash inflow in Q4 tied to a 2024 tax refund including $108 million related to the 2024 PTC. Management said France is shifting from feed-in tariffs to solar-plus-battery, they plan to introduce IQ9S and Gen 5 and social media, and said riots caused negligible disruption.
"So Q4, as we expect to get the 2024 tax refund, as I said, in remarks, right, $108 million related to our 2024 PTC." — Mandy Yang (CFO)
2027 seasonality and timing of growth
Q (Maheep Mandloi · Mizuho): Analyst asked how to think about 2027 quarterly seasonality for the $200 million core run-rate and timing for the added $200 million growth drivers.
A: Management said think of $200 million core per quarter plus $200 million of growth drivers; many growth drivers (Gen 5 battery pilots, bidirectional pilots, commercial battery pilots) start in late Q4 or Q1 so some will affect Q1 and help offset seasonal weakness.
"Many of those growth drivers are going to take into effect by Q1." — Badrinarayanan Kothandaraman (CEO)