Executive Summary

Net sales rose 14.3% year over year to $336.2M; adjusted EBITDA loss narrowed to -$10.3M (-3.1% margin) and diluted EPS was -$1.01, supported by higher ASPs, improved utilization, and Mexico restarts .
Guidance was lowered: FY25 adjusted EBITDA margin revised to 0–2% (from 2–4%) and utilization to 80–85% on 34 lines (from ~85%); net sales and capex guidance unchanged at $1.4–$1.5B and $25–$30M respectively .
Board initiated a strategic review to optimize the capital structure; NASDAQ minimum bid price non-compliance notice adds urgency and could be a stock reaction catalyst alongside the guidance cut .
Operationally, Iowa (Newton) restarted in May with two lines in 2025; Mexico blades into the U.S. are USMCA-compliant (exempt from tariffs). A Q2 safety stand‑down following an accident is expected to reduce Q2 sales by ~$35M, partly recovered later in the year .

What Went Well and What Went Wrong

What Went Well

Year-over-year revenue growth and improved adjusted EBITDA margin, with operating cash flow positive at $4.6M in Q1 .
Strong U.S. demand; Mexico volume ramp to 24/7, with USMCA-compliant blades exempt from tariffs. “We remain focused on operational excellence...” (Bill Siwek) .
Field Services revenue increased 38.4% YoY as technicians shifted back to revenue-generating projects .

What Went Wrong

FY25 adjusted EBITDA margin guidance lowered to 0–2% (from 2–4%) due to warranty charges and April production suspension; utilization trimmed to 80–85% (from ~85%) .
Elevated pre‑existing warranty charges and labor cost inflation in Türkiye and Mexico pressured profitability .
NASDAQ minimum bid price non‑compliance letter increases financing and listing risk amid strategic review uncertainty .

Financial Results

Quarterly Comparison vs Prior Quarter and Prior Year

Metric	Q3 2024	Q4 2024	Q1 2025
Revenue ($USD Millions)	$380.8	$346.5	$336.2
Diluted EPS ($)	-$0.81	-$1.03	-$1.01
Adjusted EBITDA ($USD Millions)	$8.0	$1.2	-$10.3
Adjusted EBITDA Margin %	2.1%	0.4%	-3.1%
Utilization %	89%	91%	70%
Wind Blade ASP ($ Thousands)	$199	$177	$209

Q1 2025 vs Q1 2024 (YoY)

Metric	Q1 2024	Q1 2025	YoY Change
Revenue ($USD Millions)	$294.0	$336.2	+14.3%
Diluted EPS ($)	-$1.29	-$1.01	Improvement
Adjusted EBITDA ($USD Millions)	-$23.0	-$10.3	+$12.7
Adjusted EBITDA Margin %	-7.8%	-3.1%	+470 bps
Utilization %	67%	70%	+300 bps
Wind Blade ASP ($ Thousands)	$183	$209	+$26

Segment Net Sales (Q1 2025)

Segment	Net Sales ($USD Millions)
U.S.	$5.356
Mexico	$207.471
EMEA	$89.153
India	$34.177
Total	$336.157

Product Mix (Q1 2025)

Category	Net Sales ($USD Millions)
Wind blade, tooling & other wind	$329.041
Field Services	$7.116
Total	$336.157

KPIs (Q1 2024 vs Q1 2025)

KPI	Q1 2024	Q1 2025
Sets (3 blades per set)	488	509
Estimated Megawatts	2,050	1,933
Utilization %	67%	70%
Dedicated Manufacturing Lines	36	36
Installed Lines	36	36
Wind Blade ASP ($ Thousands)	$183	$209

Note: Q1 adjusted EBITDA included ~$12.7M warranty charge, ~$8.4M start‑up/transition costs, and ~$4M 24/7 shift ramp costs .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Sales from Continuing Ops	FY 2025	$1.4–$1.5B	$1.4–$1.5B	Maintained
Adjusted EBITDA Margin %	FY 2025	2%–4%	0%–2%	Lowered
Utilization % (Lines)	FY 2025	~85% (34 lines)	80%–85% (34 lines)	Lowered
Capital Expenditures	FY 2025	$25–$30M	$25–$30M	Maintained

Management attributed the EBITDA margin revision primarily to Q1 warranty charges and an April safety stand‑down that suspended production temporarily .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3 & Q4 2024)	Current Period (Q1 2025)	Trend
Tariffs & Policy (U.S. & IRA)	Prepared contingency; monitoring tariff delays; EBITDA guide 2–4% tied to volume and cost savings	Mexico blades USMCA-exempt; OEMs bear tariffs for India/Türkiye shipments; 45X phase-down concerns; assessing IRA reconciliation; Iowa tariffs under evaluation	Policy uncertainty persists; mitigation in place; cautious tone
Supply Chain & Cost	Expect ~8% BOM cost reductions; lean programs; Blade Assure introduced	Reaffirmed cost reduction trajectory; 24/7 ramp costs in Mexico; supply chain stable	Cost-down intact; ramping drives near-term costs
Product Performance/ASP	Next-gen blade transitions; ASP up with mix	ASP rose to $209K; demand strong in U.S.	Mix-driven ASP strength continues
Regional Trends	U.S. demand strong; Türkiye inflation and competition; India transitions	Türkiye underutilization; two lines may go away mid-year; India ~40% to U.S.; Iowa restart	U.S. strength; EMEA/India softness
R&D/Quality (AI/tech)	Blade Assure rollout by end-2025; AI‑aided vision, automation	Continued focus on lean and quality; sustainability report highlights	Execution ongoing
Regulatory/Legal	Q4: IRA uncertainty; EU reforms	Strategic review initiated; NASDAQ bid-price notice; potential strike risk in Türkiye	Elevated corporate/legal risk

Management Commentary

“In the first quarter, TPI achieved 14% year-over-year growth in sales and drove positive cash flows from operating activities… we are working with… advisors to conduct a strategic review… focused on optimizing our capital structure” — Bill Siwek, CEO .
“Under current regulations, all blades produced in our Mexico plants are USMCA compliant and therefore, exempt from tariffs… Blades sold into the U.S. out of our plants in India and Türkiye are subject to… tariffs… our contractual agreements… stipulate that the OEMs bear the responsibility for these tariffs.” .
“The downward revision [to margin] is primarily due to the warranty charge… and the impact of a production suspension… following an accident.” — Ryan Miller, CFO .
“We plan to have 2 production lines [in Newton, IA] operational this year, providing approximately 400 good paying jobs.” — CEO .
“Our adjusted EBITDA margin benefited from strong sales into the U.S.… partially offset by weaker sales coming out of our Türkiye factories.” — CEO .

Q&A Highlights

Strategic review formalizes ongoing capital structure efforts; focus on “right-sizing” the balance sheet (right side) .
IRA reconciliation: concern on 45X wind phase-down by end-2027 and transferability details still being parsed .
Iowa restart: two lines in 2025; further expansion depends on demand, tariffs, and reconciliation outcomes .
Supply chain costs: ~8% BOM cost reductions still realistic despite tariff dynamics; market cooperating .
U.S. demand: 2025 remains strong and unchanged; 2026 currently expected to be flat vs 2025 given uncertainty .
Q2 impact: safety stand‑down expected to reduce Q2 sales by ~$35M; margins to peak in Q3 with highest volume; solid second half expected .

Estimates Context

Wall Street consensus from S&P Global could not be retrieved for TPIC due to a CIQ mapping issue at the time of analysis; therefore, comparisons vs consensus are unavailable. Estimates unavailable via S&P Global at this time.
Implication: With no consensus reference, the guidance cut (EBITDA margin to 0–2%) and April production suspension are likely to drive downward estimate revisions for margin and Q2 sales .

Key Takeaways for Investors

Guidance reset: The lowered FY25 adjusted EBITDA margin (0–2%) and trimmed utilization reflect near-term headwinds (warranty charge, Q2 safety event) — expect consensus margin and Q2 revenue estimate cuts; focus shifts to execution in H2 with Q3 peak volume .
U.S. demand resilient: Mexico and Iowa capacity underpin U.S. deliveries; USMCA compliance exempts Mexico blades from tariffs, and OEMs bear India/Türkiye tariffs — mitigating U.S. tariff risk .
EMEA/Türkiye risk: Underutilization and inflation remain drags; potential further workforce rationalization mid‑year reduces risk but keeps EMEA margin fragile .
Liquidity and capital structure: $171.9M unrestricted cash and strategic review underway; NASDAQ bid-price non-compliance raises urgency to stabilize equity value and address debt load .
Operational execution: Continued lean/quality initiatives (Blade Assure) and 24/7 ramp in Mexico should support cost-down and reliability; near-term ramp costs weigh on margins but are investments for H2 .
Field Services growth: Mix shift back to revenue projects supports >50% FY increase; watch for incremental, higher-margin contribution .
Trading implications: Near term, guidance reduction and Q2 safety impact are negative catalysts; medium term, H2 volume/margin recovery and strategic review outcomes (deleveraging, asset sales, or equity actions) are key swing factors .

Appendix: Additional Context

Prior quarter (Q4 2024) summary: Revenue $346.5M; adjusted EBITDA $1.2M; utilization 91%; margin at ~5% excluding inventory reduction, 24/7 ramp costs, and warranty adjustments .
Q3 2024: Revenue $380.8M; adjusted EBITDA $8.0M; utilization 89%; positive sequential trajectory ahead of Q4 inventory actions .

TPI COMPOSITES, INC (TPIC)·Q1 2025 Earnings Summary