Hanwha Solutions (009830) Q2 2025 earnings summary

Executive summary

• Addressed cell quality issues in Korea and Malaysia, with resolution expected by end of July and normalization of exports from August onward.

• Revenue for 2Q25 increased 0.7% sequentially to 31,172억원, with operating income surging 237% to 1,021억원, marking a return to profitability year-over-year.

• Growth driven by improved module spreads and higher sales in renewable energy, while chemical segment losses narrowed due to maintenance effects.

• Adjusted annual module shipment guidance from 9 GW to 7.5 GW for 2025 due to delays in U.S. plant, quality issues, and project delays in Europe.

• Residential energy (TPO) segment faces market uncertainty due to policy changes and end of 25D initiative, but expects to leverage 48E incentives and DCA model to increase market share.

Financial highlights

• Cumulative first half operating profit for residential energy business was KRW 180 billion, offset by KRW 145 billion non-operating loss from financial instrument valuation, resulting in net profit of KRW 39 billion.

• Q2 module sales increased 10% quarter-on-quarter; Q3 sales volume expected to remain stable.

• Project sales and EPC revenue guidance for Q3 is KRW 80–90 billion, with full-year target of KRW 4 trillion.

• EBITDA for 2Q25 reached 2,918억원, up 31% sequentially, with EBITDA margin at 9.4%.

• Operating margin improved to 3.3% from 1.0% in 1Q25.

Outlook and guidance

• Q3 renewable energy segment expected to post a loss of around KRW 100 billion, mainly due to reduced AMPC from quality issues and higher costs.

• AMPC guidance for Q3 is KRW 120 billion.

• Module shipment guidance for 2025 revised to 7.5 GW due to operational delays and quality issues.

• Renewable energy market expected to grow, with U.S. and Europe projected at 40GW+ and 70GW+ respectively, despite ongoing price competition.

• No detailed guidance provided for residential business due to market uncertainty from OBBBA Act.