Complete Solaria, Inc. (SPWR)·Q2 2025 Earnings Summary

Executive Summary

• Q2’25 revenue fell to $67.5M, but SunPower (formerly Complete Solaria) sustained non-GAAP operating profitability ($2.4M) as aggressive cost cuts raised gross margin to 43% and reduced OpEx ex-commissions by $4.6M sequentially .
• GAAP operating loss was $(2.7)M, with GAAP-to-non-GAAP delta of $5.1M driven by $3.7M stock comp and $1.4M amortization; non-GAAP operating income was $2.4M in Q2 vs $2.9M in Q1 (both non-GAAP) .
• Management guided to Q3’25 revenue “about $70M” and non-GAAP operating profit “about $3.0M,” and expects resolution of $16M in delayed New Homes A/R collections in Q3 with another tranche in Q4, providing a near-term working-capital tailwind .
• No S&P Global consensus estimates were available for Q2’25 or current quarter; the stock narrative focuses on execution and cost discipline amid ITC/tariff uncertainty, index inclusion (Russell 3000/Microcap), and improving bookings as demand “warms up” post-ITC shock .

What Went Well and What Went Wrong

What Went Well

• Delivered second consecutive quarter of non-GAAP operating profit despite a sharper-than-modeled revenue drop; management: “our Q2’25 actual revenue dropped to $67.5 million… but we still made a $2.42 million operating profit” due to cost controls and mix focus .
• Gross margin expanded to 43% (from 39% in Q1) as the company prioritized more profitable segments, offsetting volume pressure .
• Structural catalysts: joined Russell 3000 and Microcap indices (broadens investor base/liquidity) and established a low-cost finance center in Chennai leveraging accountants and AI automation to structurally reduce G&A run-rate .

What Went Wrong

• Revenue declined faster than internal elasticity modeling anticipated (to $67.5M vs ~$74–$80M modeled), reflecting acute ITC-related demand shock in residential solar .
• GAAP operating loss of $(2.7)M in Q2 reflects elevated stock comp and amortization; dependency on non-GAAP to demonstrate profitability persists during integration .
• Collections friction in New Homes due to an AR authorization dispute delayed ~$16M of receivables in Q2; the authorization was signed at quarter-end and management plans collections in Q3/Q4 .

Financial Results

Notes:

• Q1’25 revenue and margin in this table use the harmonized recognition approach adopted with the audited 10-K; Q1 was recast to $82.7M/39% vs $80.2M/36% previously disclosed .
• GAAP-to-non-GAAP delta in Q2’25 operating income: $3.7M stock comp + $1.4M amortization of intangibles .

KPIs

• Headcount: 906 in Q1’25; reduced to 861 in Q2’25; $500 stock bonus to each employee (~0.4% annualized dilution) recognizing execution .
• Collections: ~$16M New Homes AR delayed in Q2 due to authorization issues; agreement now signed, with collections planned Q3 and additional tranche in Q4 .

Segment Breakdown

• Not disclosed; results discussed at consolidated level with divisional references (New Homes, Blue Raven) but without segment financials .

Vs Estimates

• S&P Global consensus for Q2’25 revenue and EPS was unavailable at the time of analysis (no published values, no estimate counts)* [GetEstimates].
  *Values retrieved from S&P Global.

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “Our Q2’25 actual revenue dropped to $67.5 million… but we still made a $2.42 million operating profit – due to a vigorous effort in reducing our operating expense… [and] focus on our most profitable market segments, which raised gross margin from 39% to 43%.” – T.J. Rodgers, CEO .
• “For Q3’25 vs Q2’25, we forecast modestly increased revenue (about $70 million) and increased operating profit (about $3.0 million).” .
• On ITC: “Washington’s exit from solar will be a great benefit… Yes, there will be a one-time hurdle… after that… the companies that survive… will be able to hunker down and run their businesses properly.” .
• On structurally lowering cost: “Chennai… has become our low-cost center for finance, including SOX… Excelencia… will be doing most of our accounting work, and MylAI… to automate business processes for us.” .

Q&A Highlights

• No Q2’25 earnings call transcript was posted in the document set; the company hosted a webcast (link referenced in releases), but a transcript was not available for review .
• Management reiterated near-term outlook in press materials: sequential revenue and profit improvement targeted for Q3 and working-capital inflow from AR collections .

Estimates Context

• S&P Global Wall Street consensus for Q2’25 revenue and EPS was unavailable (no published values or estimate counts), limiting formal beat/miss analysis; microcap coverage appears sparse* [GetEstimates].
• As the company builds a consecutive profit record and index inclusion broadens exposure, we would expect coverage to normalize and estimates to populate, especially if Q3 guidance is achieved or raised .
  *Values retrieved from S&P Global.

Key Takeaways for Investors

• Execution over macro: Despite a sharper-than-expected ITC-related demand shock, SPWR preserved non-GAAP profitability through mix and cost discipline; margin resilience (43%) is the core narrative .
• Near-term catalysts: planned collection of ~$16M AR in Q3 (plus Q4 tranche) and Russell index inclusion can tighten working capital and broaden ownership; both support multiple and liquidity .
• Guide implies inflection: Q3 outlook of ~$70M revenue and ~$3.0M non-GAAP operating profit suggests sequential improvement and a potential third consecutive profitable quarter, an important credibility milestone .
• Watch GAAP drag: GAAP losses reflect stock comp and amortization; monitor trajectory of these non-cash items versus non-GAAP profitability as the integration matures .
• Demand trajectory: Management indicates bookings are improving post-ITC shock; track conversion and close rates into late Q3/Q4; confirmation here underpins sustained operating leverage .
• Organizational scalability: Low-cost finance hub and leadership additions (interim CFO, new CLO, EVP Sales) should support process rigor and growth initiatives without re-inflating overhead .
• Risk checks: Policy/tariff volatility, counterparties, and financing ecosystem remain swing factors; management’s focus on profitable segments and cash discipline is key to navigating external shocks .

Appendix: Additional References

• Q2’25 8-K 2.02 and Exhibit 99.1 press release (full Q2 financial tables, non-GAAP reconciliation, outlook) .
• Q1’25 press release (first profitable quarter, headcount/cost actions, “steady revenue and positive operating income” outlook) .
• Q4’24 preliminary press release (post-merger integration, scale-up to ~$81M revenue, cost takeout plan) .
• CEO ITC commentary and modeling (breakeven levels, demand elasticity framing) .