First Solar reported third-quarter 2026 net sales of $1.23 billion and net income of $571 million as customers reassessed module purchases amid uncertainty over US Section 232 tariffs. Sales fell 23% year over year because of lower third-party module volumes, while net income increased 25% and gross margin reached 58%, about 20 percentage points above the level recorded a year earlier.

The company also authorized a new $500 million share buyback. However, it lowered its full-year volume forecast to between 16.0 GW and 17.0 GW, from its previous expectations, and reduced 2026 net sales guidance to $4.6 billion-$4.9 billion, compared with the $4.9 billion-$5.2 billion range issued after the second quarter.

First Solar ended the quarter with a contracted backlog of 44 GW valued at approximately $13.5 billion, with deliveries scheduled through 2030. Since its second-quarter update, it recorded 1.4 GW of US bookings at an average selling price of about $0.36 per watt.

The company said it is shifting toward project-specific contracts with defined delivery schedules instead of relying as heavily on broad, multi-year framework agreements. Chief Financial Officer Alex Bradley said this approach should improve operational planning and reduce working capital and warehousing needs, although it could slow the addition of new backlog. First Solar said it does not want to sell international volumes on the spot market.

Chief Executive Officer Mark Widmar described the August Section 232 proclamation as a significant change for US solar manufacturing. The company expects nearly 80% of its global manufacturing footprint to be located in the United States by 2027 and said its integrated production model leaves it without dependence on the Chinese crystalline silicon supply chain.

At the same time, procurement and price discovery have slowed. According to Widmar, developers are delaying module purchases for 2029 and 2030 while they address interconnection challenges, community opposition to data-center projects, pending Foreign Entity of Concern guidance and uncertainty over the enforcement of Section 232 minimum import prices and anti-stockpiling rules.

These pressures have particularly affected First Solar’s international Series 6 production in Southeast Asia. The company expects its Vietnam facility to supply semi-finished modules to its South Carolina finishing plant, while the Malaysia factory continues to produce finished modules for international markets.

First Solar expects to make a binary decision about the Malaysia facility during the first half of 2027: operate it at full or near-full capacity, or shut down production. The company said either outcome is not expected to materially change its run-rate earnings profile because Malaysian production does not qualify for US Section 45X manufacturing tax credits and is exposed to freight and tariff costs.

First Solar is also expanding its perovskite activities. It signed a non-exclusive patent licensing agreement with CubicPV, adding to its existing agreement with Oxford PV, and plans to begin producing Series 6-format perovskite modules at its Perrysburg, Ohio, facility during the first half of 2027 for field testing and durability validation.

The company is continuing to address legal disputes involving its TOPCon intellectual property and a warranty lawsuit filed by developer Swift Current Energy. Widmar said First Solar will soon submit its formal response in the Swift Current case and maintained that any remediation obligations are governed by the company’s limited-liability warranty terms.

Sources: pv magazine.