What changed in this filing

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Item 1. Financial Statements

2022-08-04 compared with 2022-05-04 · 548 added, 694 removed, 95 unchanged (93% of the section changed)

FINANCIAL STATEMENTS

TECHNOLOGIES INC.

CONSOLIDATED BALANCE SHEETS (Unaudited)

thousands, except per share data)

SOLAREDGE TECHNOLOGIES INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

(in thousands, except per share data)

CURRENT ASSETS:

1 unchanged sentence

Marketable securities

Trade receivables, net of allowances of $ 3,226

and $ 2,626 ,

Trade receivables, net of allowances of $ 3,805 and $ 2,626 , respectively

Inventories, net

Prepaid expenses and other current assets

current assets

Total current assets

LONG-TERM ASSETS:

5 unchanged sentences

Other long-term assets

long-term assets

accompanying notes are an integral part of the condensed consolidated financial statements.

TECHNOLOGIES INC.

CONSOLIDATED BALANCE SHEETS (Unaudited) (Cont.)

thousands, except per share data)

Total long-term assets

The accompanying notes are an integral part of the condensed consolidated financial statements.

SOLAREDGE TECHNOLOGIES INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Cont.)

(in thousands, except per share data)

LIABILITIES AND STOCKHOLDERS’ EQUITY

5 unchanged sentences

Accrued expenses and other current liabilities

current liabilities

Total current liabilities

LONG-TERM LIABILITIES:

5 unchanged sentences

Other long-term liabilities

long-term liabilities

Total long-term liabilities

COMMITMENTS AND CONTINGENT LIABILITIES

STOCKHOLDERS’ EQUITY:

Common stock of $ 0.0001

par value - Authorized:

shares as of March 31, 2022 and December 31, 2021;

Common stock of $ 0.0001 par value - Authorized:

125,000,000 shares as of June 30,

2022 and December 31, 2021;

issued and outstanding:

55,633,090 and 52,815,395

shares as of March 31, 2022 and December 31, 2021, respectively

shares as of June 30, 2022 and December 31, 2021, respectively

Additional paid-in capital

1 unchanged sentence

Retained earnings

stockholders’ equity

liabilities and stockholders’ equity

accompanying notes are an integral part of the condensed consolidated financial statements.

TECHNOLOGIES INC.

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

thousands, except per share data)

and development

and marketing

and administrative

operating expenses

Total stockholders’ equity

Total liabilities and stockholders’ equity

The accompanying notes are an integral part of the condensed consolidated financial statements.

SOLAREDGE TECHNOLOGIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

(in thousands, except per share data)

Three Months Ended

Six Months Ended

Cost of revenues

Operating expenses:

before income taxes

basic earnings per share of common stock

diluted earnings per share of common stock

average number of shares used in computing net basic earnings per share of common stock

average number of shares used in computing net diluted earnings per share of common stock

accompanying notes are an integral part of the condensed consolidated financial statements.

TECHNOLOGIES INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)

thousands, except per share data)

Other comprehensive loss,

change related to available-for-sale securities

change related to cash flow hedges

currency translation adjustments on intra-entity transactions that are of a long-term investment nature

currency translation adjustments, net

Total other comprehensive

Comprehensive

accompanying notes are an integral part of the condensed consolidated financial statements.

TECHNOLOGIES INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

thousands, except per share data)

Research and development

Sales and marketing

General and administrative

Other operating expenses (income), net

Total operating expenses

Operating income

Financial expense, net

Income before income taxes

Net basic earnings per share of common stock

Net diluted earnings per share of common stock

Weighted average number of shares used in computing net basic earnings per share of common stock

Weighted average number of shares used in computing net diluted earnings per share of common stock

The accompanying notes are an integral part of the condensed consolidated financial statements.

SOLAREDGE TECHNOLOGIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)

(in thousands, except per share data)

Three Months Ended

Six Months Ended

Other comprehensive income (loss), net of tax:

Net change related to available-for-sale securities

Net change related to cash flow hedges

Foreign currency translation adjustments on intra-entity transactions that are of a long-term investment nature

Foreign currency translation adjustments, net

Total other comprehensive income (loss)

Comprehensive income (loss)

The accompanying notes are an integral part of the condensed consolidated financial statements.

SOLAREDGE TECHNOLOGIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

(in thousands, except per share data)

comprehensive

as of January 1, 2022

of Common Stock upon exercise of stock-based awards

based compensation expenses

of common stock in a secondary public offering, net of underwriters' discounts and commissions of $ 27,140

of offering costs

comprehensive loss adjustments

as of March 31, 2022

Balance as of January 1, 2022

Issuance of common stock upon exercise of stock-based awards

Stock based compensation expenses

Issuance of common stock in a secondary public offering, net of underwriters' discounts and commissions of $ 27,140 and $ 834 of offering costs

Other comprehensive loss adjustments

Balance as of March 31, 2022

Issuance of Common Stock upon exercise of stock-based awards

Issuance of Common stock under employee stock purchase plan

Stock based compensation expenses

Other comprehensive loss adjustments

Balance as of June 30, 2022

* Represents an amount less than $1.

The accompanying notes are an integral part of the consolidated financial statements.

SOLAREDGE TECHNOLOGIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

(in thousands, except per share data)

comprehensive

as of January 1, 2021

effect of adopting ASU 2020-06

of Common Stock upon exercise of stock-based awards

based compensation expenses

comprehensive loss adjustments

as of March 31, 2021

income (loss)

Balance as of January 1, 2021

Cumulative effect of adopting ASU 2020-06

Issuance of Common Stock upon exercise of stock-based awards

Stock based compensation expenses

Other comprehensive loss adjustments

Balance as of March 31, 2021

Issuance of Common Stock upon exercise of stock-based awards

Stock based compensation expenses

Other comprehensive income adjustments

Balance as of June 30, 2021

* Represents an amount less than $1.

accompanying notes are an integral part of the condensed consolidated financial statements.

TECHNOLOGIES INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

thousands, except per share data)

Months Ended March 31,

flows from operating activities:

to reconcile net income to net cash provided by operating activities:

of property, plant and equipment

of intangible assets

of debt discount and debt issuance costs

of premium and accretion of discount on available-for-sale marketable securities, net

compensation expenses

income taxes, net

(gain) from sale and disposal of assets

rate fluctuations and other items, net

in assets and liabilities:

expenses and other assets

receivables, net

payables, net

and payroll accruals

revenues and customers advances

liabilities, net

cash provided by (used in) operating activities

flows from investing activities:

from sales and maturities of available-for-sale marketable securities

of property, plant and equipment

in available-for-sale marketable securities

from bank deposits, net

investing activities

cash used in investing activities

accompanying notes are an integral part of the condensed consolidated financial statements.

TECHNOLOGIES INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Cont.)

thousands, except per share data)

Months Ended March 31,

flows from financing activities:

from secondary public offering, net of issuance costs

from exercise of stock-based awards

(withholdings) from stock-based awards, net

financing activities

cash provided by (used in) financing activities

(decrease) in cash and cash equivalents

and cash equivalents at the beginning of the period

of exchange rate differences on cash and cash equivalents

and cash equivalents at the end of the period

disclosure of non-cash activities:

asset recognized with corresponding lease liability

accompanying notes are an integral part of the condensed consolidated financial statements.

The accompanying notes are an integral part of the condensed consolidated financial statements.

SOLAREDGE TECHNOLOGIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(in thousands, except per share data)

Six Months Ended

Cash flows from operating activities:

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

Depreciation of property, plant and equipment

Amortization of intangible assets

Amortization of debt discount and debt issuance costs

Amortization of premium and accretion of discount on available-for-sale marketable securities, net

Impairment of goodwill and intangible assets

Stock-based compensation expenses

Deferred income taxes, net

Loss from sale and disposal of assets

Exchange rate fluctuations and other items, net

Changes in assets and liabilities:

Inventories, net

Prepaid expenses and other assets

Trade receivables, net

Trade payables, net

Employees and payroll accruals

Warranty obligations

Deferred revenues and customers advances

Other liabilities, net

Net cash provided by (used in) operating activities

Cash flows from investing activities:

Proceed from sales and maturities of available-for-sale marketable securities

Purchase of property, plant and equipment

Investment in available-for-sale marketable securities

Withdrawal from bank deposits, net

Other investing activities

Net cash used in investing activities

The accompanying notes are an integral part of the condensed consolidated financial statements.

SOLAREDGE TECHNOLOGIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Cont.)

(in thousands, except per share data)

Six Months Ended

Cash flows from financing activities:

Proceeds from secondary public offering, net of issuance costs

Repayment of bank loans

Proceeds from exercise of stock-based awards

Tax withholding in connection with stock-based awards, net

Other financing activities

Net cash provided by (used in) financing activities

Increase (decrease) in cash and cash equivalents

Cash and cash equivalents at the beginning of the period

Effect of exchange rate differences on cash and cash equivalents

Cash and cash equivalents at the end of the period

Supplemental disclosure of non-cash activities:

Right-of-use asset recognized with corresponding lease liability

The accompanying notes are an integral part of the condensed consolidated financial statements.

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

1 unchanged sentence

SolarEdge Technologies, Inc.

(the “Company”)

and its subsidiaries design, develop, and sell an intelligent inverter solution designed to maximize power generation at the individual

photovoltaic (“PV”) module level while lowering the cost of energy produced by the solar PV system and providing comprehensive

and advanced safety features.

The Company’s products consist mainly of (i) power optimizers designed to maximize energy throughput

from each and every module through constant tracking of Maximum Power Point individually per module, (ii) inverters which invert direct

current (DC) from the PV module to alternating current (AC) including the Company’s future ready energy hub inverter which supports,

among other things, connection to a DC- coupled battery for backup capabilities, (iii) a remote cloud-based monitoring platform, that

collects and processes information from the power optimizers and inverters to enable customers and system owners, to monitor and manage

the solar PV system (iv) a residential storage and backup solution which includes a company designed and manufactured lithium-ion DC-coupled

battery that is used to increase energy independence and maximize self-consumption for homeowners including a battery, and (v) additional

smart energy management solutions.

Company and its subsidiaries sell products worldwide through large distributors, electrical equipment wholesalers, as well as directly

to large solar installers and engineering, procurement and construction firms.

The Company has expanded its activity to other

areas of smart energy technology organically and through acquisitions.

The Company now offers a variety of energy solutions, which include

lithium-ion cells, batteries and energy storage systems (“Energy Storage”), full powertrain kits for electric vehicles, or

EVs (“e-Mobility”), uninterrupted power supply solutions or UPS (“Critical Power”), as well as automated machines

for industrial use (“Automation Machines”).

(the “Company”) and its subsidiaries design, develop, and sell an intelligent inverter solution designed to maximize power generation at the individual photovoltaic (“PV”) module level while lowering the cost of energy produced by the solar PV system and providing comprehensive and advanced safety features.

The Company’s products consist mainly of (i) power optimizers designed to maximize energy throughput from each and every module through constant tracking of Maximum Power Point individually per module, (ii) inverters which invert direct current (DC) from the PV module to alternating current (AC) including the Company’s future ready energy hub inverter which supports, among other things, connection to a DC- coupled battery for backup capabilities, (iii) a remote cloud-based monitoring platform, that collects and processes information from the power optimizers and inverters to enable customers and system owners, to monitor and manage the solar PV system (iv) a residential storage and backup solution which includes a company designed and manufactured lithium-ion DC-coupled battery that is used to increase energy independence and maximize self-consumption for homeowners including a battery, and (v) additional smart energy management solutions.

The Company and its subsidiaries sell products worldwide through large distributors, electrical equipment wholesalers, as well as directly to large solar installers and engineering, procurement, and construction firms.

The Company has expanded its activity to other areas of smart energy technology organically and through acquisitions.

The Company now offers a variety of energy solutions, which include lithium-ion cells, batteries, and energy storage systems (“Energy Storage”), full powertrain kits for electric vehicles, or EVs (“e-Mobility”), uninterrupted power supply solutions or UPS (“Critical Power”), as well as automated machines for industrial use (“Automation Machines”).

In June 2022, the Company decided to discontinue its stand-alone Critical Power activities.

The Company determined that the discontinuance of the Critical Power business doesn't represent a strategic shift that will have a major effect on the Company's operations and financial results and therefore it did not meet the criteria for discontinued operations classification.

Basis of Presentation:

unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with U.S.

generally accepted

accounting principles (“U.S.

In management’s opinion, the unaudited condensed consolidated financial statements

reflect all adjustments of a normal recurring nature that are necessary for a fair presentation of the results for the interim periods

The Company’s interim period results do not necessarily indicate the results that may be expected for any other interim

period or for the full fiscal year.

significant accounting policies applied in the annual consolidated financial statements of the Company as of December 31, 2021, contained

in the Company’s Annual Report on Form 10-K filed with the SEC on February 22, 2022, have been applied consistently in these unaudited

interim condensed consolidated financial statements.

The unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with U.S.

generally accepted accounting principles (“U.S.

In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair presentation of the results for the interim periods presented.

The Company’s interim period results do not necessarily indicate the results that may be expected for any other interim period or for the full fiscal year.

The significant accounting policies applied in the annual consolidated financial statements of the Company as of December 31, 2021, contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 22, 2022, have been applied consistently in these unaudited interim condensed consolidated financial statements.

Certain prior year amounts have been reclassified to conform to current year presentation.

Use of estimates:

preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported

amounts of assets, liabilities, revenues, costs and expenses and related disclosures in the accompanying notes.

The duration, scope and

effects of the ongoing Covid-19 pandemic and the conflict in Ukraine, government and other third-party responses to it, and the related

macroeconomic effects, including to the Company’s business and the business of the Company’s suppliers and customers are uncertain,

rapidly changing and difficult to predict.

As a result, the Company’s accounting estimates and assumptions may change over time

in response to this evolving situation.

Such changes could result in future impairments of goodwill, intangibles, long-lived assets, inventories,

incremental credit losses on receivables and available-for-sale marketable debt securities, or an increase in the Company’s insurance

liabilities as of the time of a relevant measurement event.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, costs and expenses and related disclosures in the accompanying notes.

The duration, scope and effects of the ongoing Covid-19 pandemic and the conflict in Ukraine, government and other third-party responses to it, and the related macroeconomic effects, including to the Company’s business and the business of the Company’s suppliers and customers are uncertain, rapidly changing and difficult to predict.

As a result, the Company’s accounting estimates and assumptions may change over time in response to this evolving situation.

Such changes could result in future impairments of goodwill, intangibles, long-lived assets, inventories, incremental credit losses on receivables and available-for-sale marketable debt securities, or an increase in the Company’s insurance liabilities as of the time of a relevant measurement event.

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

Concentrations of supply risks:

Company depends on two contract manufacturers and several limited or single source component suppliers.

Reliance on these vendors makes

the Company vulnerable to possible capacity constraints and reduced control over component availability, delivery schedules, manufacturing

yields, and costs.

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

GENERAL (Cont.)

of March 31, 2022, and December 31, 2021, two contract manufacturers collectively accounted for 20.9 %

of the Company’s total trade payables, net, respectively.

2020, the Company began commercial shipments from its manufacturing facility in the North of Israel, “Sella 1”.

second quarter of 2021, Sella 1 reached full manufacturing capacity.

The Company depends on two contract manufacturers and several limited or single source component suppliers, including, Samsung SDI, that provides lithium-ion battery cells required for the Company's residential storage solution.

Reliance on these vendors makes the Company vulnerable to possible capacity constraints and reduced control over component availability, delivery schedules, manufacturing yields, and costs.

As of June 30, 2022, and December 31, 2021, two contract manufacturers collectively accounted for 31.9 % and 27.9 % of the Company’s total trade payables, net, respectively.

In the second quarter of 2022, the Company announced the opening of “Sella 2”, a two gigawatt-hour (GWh) Li-Ion battery cell manufacturing facility located in South Korea.

Sella 2 is currently in testing phase with ramp-up expected during the second half of 2022.

Sella 2, is the Company's second owned manufacturing facility following the opening of the Company's manufacturing facility in the North of Israel, “Sella 1” in 2020.

New accounting pronouncements not yet adopted:

time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other standard setting

bodies are adopted by the Company as of the specified effective date.

The Company believes that the impact of recently issued standards

that are not yet effective will not have a material impact on its financial position or results of operations upon adoption.

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other standard setting bodies are adopted by the Company as of the specified effective date.

The Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption.

Recently issued and adopted pronouncements:

October 2021, the Financial Accounting Standards Board (“FASB”) issued ASU No.

2021-08, Accounting for Contract Assets and

Contract Liabilities from Contracts with Customers (Topic 805).

This ASU requires an acquirer in a business combination to recognize and

measure contract assets and contract liabilities (deferred revenue) from acquired contracts using the revenue recognition guidance in

In October 2021, the Financial Accounting Standards Board (“FASB”) issued ASU No.

2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (Topic 805).

This ASU requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities (deferred revenue) from acquired contracts using the revenue recognition guidance in Topic 606.

At the acquisition date, the acquirer applies the revenue model as if it had originated the acquired contracts.

effective for annual periods beginning after December 15, 2022, including interim periods within those fiscal years.

Adoption of the ASU

should be applied prospectively.

The ASU is effective for annual periods beginning after December 15, 2022, including interim periods within those fiscal years.

Adoption of the ASU should be applied prospectively.

Early adoption is also permitted, including adoption in an interim period.

The Company elected to early

adopt ASU 2021-08 on January 1, 2022, and will apply this new guidance to all business combinations consummated subsequent to this date.

The Company elected to early adopt ASU 2021-08 on January 1, 2022, and will apply this new guidance to all business combinations consummated subsequent to this date.

Currently, this ASU has no material impact on our consolidated financial statements.

November 2021 the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No.

2021-10, Government

Assistance (Topic 832):

In November 2021 the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No.

2021-10, Government Assistance (Topic 832):

Disclosures by Business Entities about Government Assistance.

Under ASU 2021-10, the accounting entities with

transactions with a government that are accounted for by analogy to a grant or contribution accounting model are required to annually

disclose certain information regarding the transaction including:

Under ASU 2021-10, the accounting entities with transactions with a government that are accounted for by analogy to a grant or contribution accounting model are required to annually disclose certain information regarding the transaction including:

(i) nature and related accounting policy used;

(ii) line items on the

balance sheet and income statement affected by the transactions;

(ii) line items on the balance sheet and income statement affected by the transactions;

(iii) amounts applicable to each line item;

and (iv) significant terms

and conditions.

and (iv) significant terms and conditions.

This guidance is effective for financial statements issued for annual periods beginning after 15 December 2021.

of this ASU will have a minor impact on the disclosures to the annual consolidated financial statements.

Certain prior period amounts have been reclassified

to conform to the current period presentation.

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

The adoption of this ASU will have a minor impact on the disclosures to the annual consolidated financial statements.

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

MARKETABLE SECURITIES

following is a summary of available-for-sale marketable securities as of March 31, 2022:

Available-for-sale

– matures within one year:

Available-for-sale

– matures after one year:

following is a summary of available-for-sale marketable securities as of December 31, 2021:

Available-for-sale

– matures within one year:

Available-for-sale

– matures after one year:

of March 31, 2022 and December 31, 2021 the Company didn’t record an allowance for credit losses for its available-for-sale marketable

debt securities.

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

The following is a summary of available-for-sale marketable securities as of June 30, 2022:

Amortized cost

Gross unrealized

Available-for-sale – matures within one year:

Corporate bonds

Governmental bonds

Available-for-sale – matures after one year:

Corporate bonds

Governmental bonds

The following is a summary of available-for-sale marketable securities as of December 31, 2021:

Amortized cost

Gross unrealized

Available-for-sale – matures within one year:

Corporate bonds

Governmental bonds

Available-for-sale – matures after one year:

Corporate bonds

Governmental bonds

As of June 30, 2022, and December 31, 2021, the Company did not record an allowance for credit losses for its available-for-sale marketable securities.

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

INVENTORIES, NET

Raw materials

Work in process

Finished goods

INVESTMENT IN PRIVATELY-HELD COMPANY

January 31, 2021, the Company completed an investment of $ 11,643

in the preferred stock of AutoGrid Systems, Inc.

On January 31, 2021, the Company completed an investment of $ 11,643 in the preferred stock of AutoGrid Systems, Inc.

("AutoGrid"), a privately held company without readily determinable fair values.

February 1, 2021, the Company signed on a preferred stock purchase agreement for an additional investment of $ 5,000

in AutoGrid's preferred stock (the "second investment").

On February 1, 2021, the Company signed on a preferred stock purchase agreement for an additional investment of $ 5,000 in AutoGrid's preferred stock (the "second investment").

On April 28, 2021, the Company completed the second investment.

Company accounted for the AutoGrid investment as an equity investment that does not have readily determinable fair values.

Company’s non-marketable equity securities had a carrying value of $ 16,643

as of March 31, 2022 and December 31, 2021.

in privately-held companies are included within other long-term assets on the consolidated balance sheets.

impairment or other adjustments related to observable price changes in orderly transactions for identical or similar investments were

identified for the three months ended March 31, 2022 and 2021.

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

The Company accounted for the AutoGrid investment as an equity investment that does not have readily determinable fair values.

As such, the Company’s non-marketable equity securities had a carrying value of $ 16,643 as of June 30, 2022, and December 31, 2021.

Investments in privately-held companies are included within other long-term assets on the consolidated balance sheets.

No impairment or other adjustments related to observable price changes in orderly transactions for identical or similar investments were identified for the three and six months ended June 30, 2022, and 2021.

On July 20, 2022, the Company sold its investment in AutoGrid, see Note 18.

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

protect against the increase in value of forecasted foreign currency cash flows resulting from salary denominated in the Israeli currency,

the New Israeli Shekels (“NIS”), during the three months ended March 31, 2022, the Company instituted a foreign currency cash

flow hedging program.

The Company hedges portions of the anticipated payroll denominated in NIS for a period of one to nine months with

hedging contracts.

Accordingly, when the dollar strengthens against the NIS, the decline in present value of future foreign currency expenses

is offset by losses in the fair value of the hedging contracts.

Conversely, when the dollar weakens, the increase in the present value

of future foreign currency cash flows is offset by gains in the fair value of the hedging contracts.

These hedging contracts are designated

as cash flow hedges, as defined by ASC 815 and are all effective hedges.

of March 31, 2022, the Company entered into forward contracts and put and call options to sell and buy U.S.

dollars (“USD”)

for NIS in the amount of $ 29

million and $ 44

million, respectively.

addition to the above-mentioned cash flow hedges transactions, the Company also entered into derivative instrument arrangements to hedge

the Company’s exposure to currencies other than the U.S.

These derivative instruments are not designated as cash flow hedges,

as defined by ASC 815, and therefore all gains and losses, resulting from fair value remeasurement, were recorded immediately in the statement

of income, under "Financial expense, net".

of March 31, 2022, the Company entered into forward contracts to sell Australian dollars (“AUD”) for U.S.

dollars in the amount

of March 31, 2022, the Company entered into forward contracts to sell Euro for U.S.

dollars in the amount of € 29

of March 31, 2022, the Company entered into forward contracts to sell U.S.

dollars for South Korean Won in the amount of $ 5,000 .

fair value of derivative assets as of March 31, 2022, and December 31, 2021 was $ 2,042

and $ 4,009 ,

which was recorded in prepaid expenses and other current assets in the Consolidated Balance Sheets, respectively.

fair value of derivative liabilities as of March 31, 2022, and December 31, 2021 was $ 536

which was recorded in accrued expenses and other current liabilities in the Consolidated Balance Sheets, respectively.

the three months ended March 31, 2022 and 2021, the Company recorded a gain and in the amount of $ 934

and $ 3,536 ,

respectively, in "Financial expense, net", related to the derivative instruments not designated as hedging instruments.

the three months ended March 31, 2022 and 2021, the Company recorded an unrealized loss in the amount of $ 1,178

net of tax effect, respectively, in “Accumulated other comprehensive loss” related to the derivative assets designated as

hedging instruments.

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

To protect against the increase in value of forecasted foreign currency cash flows resulting from salary denominated in the Israeli currency, the New Israeli Shekels (“NIS”), during the six months ended June 30, 2022, the Company instituted a foreign currency cash flow hedging program.

The Company hedges portions of the anticipated payroll denominated in NIS for a period of one to nine months with hedging contracts.

Accordingly, when the dollar strengthens against the NIS, the decline in present value of future foreign currency expenses is offset by losses in the fair value of the hedging contracts.

Conversely, when the dollar weakens, the increase in the present value of future foreign currency cash flows is offset by gains in the fair value of the hedging contracts.

These hedging contracts are designated as cash flow hedges, as defined by ASC 815 and are all effective hedges.

As of June 30, 2022, the Company entered into forward contracts and put and call options to sell and buy U.S.

dollars (“USD”) for NIS in the amount of approximately $ 75 million and $ 34 million, respectively.

In addition to the above-mentioned cash flow hedges transactions, the Company also entered into derivative instrument arrangements to hedge the Company’s exposure to currencies other than the U.S.

These derivative instruments are not designated as cash flow hedges, as defined by ASC 815, and therefore all gains and losses, resulting from fair value remeasurement, were recorded immediately in the statement of income, under "Financial expense, net".

As of June 30, 2022, the Company entered into forward contracts to sell Australian dollars (“AUD”) for U.S.

dollars in the amount of AUD 10 million.

As of June 30, 2022, the Company entered into forward contracts to sell Euro for U.S.

dollars in the amount of € 18 million.

The fair value of derivative assets as of June 30, 2022, and December 31, 2021, was $ 2,348 and $ 4,009 , which was recorded in prepaid expenses and other current assets in the Consolidated Balance Sheets, respectively.

The fair value of derivative liabilities as of June 30, 2022, and December 31, 2021, was $ 4,123 and $ 169 , which was recorded in accrued expenses and other current liabilities in the Consolidated Balance Sheets, respectively.

For the three months ended June 30, 2022, and 2021, the Company recorded a gain in the amount of $ 3,009 and $ 820 , respectively, in financial expense, net, related to the derivative instruments not designated as cash flow hedges.

For the three months ended June 30, 2022 and 2021, the Company recorded an unrealized loss in the amount of $ 6,351 , net of tax effect and an unrealized gain in the amount of $ 841 , net of tax effect, respectively, in “accumulated other comprehensive loss” related to the derivative assets designated as hedging instruments.

For the six months ended June 30, 2022, and 2021, the Company recorded a gain in the amount of $ 3,943 and $ 4,355 , respectively, in financial expense, net, related to the derivative instruments not designated as cash flow hedges.

For the six months ended June 30, 2022 and 2021, the Company recorded an unrealized loss in the amount of $ 7,529 , net of tax effect and an unrealized gain in the amount of $ 713 , net of tax effect, respectively, in “accumulated other comprehensive loss” related to the derivative assets designated as hedging instruments.

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

FAIR VALUE MEASUREMENTS

accordance with ASC 820, the Company measures its cash equivalents and marketable securities, at fair value using the market approach

valuation technique.

Cash equivalents and marketable securities are classified within Level 1 and Level 2, respectively, because these

assets are valued using quoted market prices or alternative pricing sources and models utilizing market observable inputs.

Foreign currency

derivative contracts are classified within the Level 2 value hierarchy, as the valuation inputs are based on quoted prices and market

observable data of similar instruments.

following table sets forth the Company’s assets that were measured at fair value as of March 31, 2022 and December 31, 2021 by level

within the fair value hierarchy:

value measurements as of

Value Hierarchy

market mutual funds

instruments asset:

contracts designated as hedging instruments

and forward contracts not designated as hedging instruments

marketable securities:

instruments liability:

and forward contracts designated as hedging instruments

contracts not designated as hedging instruments

In accordance with ASC 820, the Company measures its cash equivalents and marketable securities, at fair value using the market approach valuation technique.

Cash equivalents and marketable securities are classified within Level 1 and Level 2, respectively, because these assets are valued using quoted market prices or alternative pricing sources and models utilizing market observable inputs.

Foreign currency derivative contracts are classified within the Level 2 value hierarchy, as the valuation inputs are based on quoted prices and market observable data of similar instruments.

The following table sets forth the Company’s assets that were measured at fair value as of June 30, 2022 and December 31, 2021, by level within the fair value hierarchy:

Fair value measurements as of

Fair Value Hierarchy

Cash equivalents:

Money market mutual funds

Derivative instruments asset:

Forward contracts designated as hedging instruments

Options and forward contracts not designated as hedging instruments

Short-term marketable securities:

Corporate bonds

Governmental bonds

Long-term marketable securities:

Corporate bonds

Governmental bonds

Derivative instruments liability:

Options and forward contracts designated as hedging instruments

Forward contracts not designated as hedging instruments

WARRANTY OBLIGATIONS

in the Company’s product warranty obligations for the three months ended March 31, 2022 and 2021, were as follows:

Months Ended March 31,

at the beginning of the period

and adjustments to cost of revenues

and current warranty expenses

at end of the period

current portion

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

DEFERRED REVENUES

revenues consist of deferred cloud-based monitoring services, communication services, warranty extension services and advance payments

received from customers for the Company’s products.

Deferred revenues are classified as short-term and long-term deferred revenues

based on the period in which revenues are expected to be recognized.

changes in the balances of deferred revenues during the period are as follows:

Months Ended March 31,

at the beginning of the period

in deferred revenues and customer advances

at the end of the period

current portion

following table includes estimated revenues expected to be recognized in the future related to performance obligations that are unsatisfied

(or partially unsatisfied) as of March 31, 2022:

Changes in the Company’s product warranty obligations for the three and six months ended June 30, 2022 and 2021, were as follows:

Three Months Ended June 30,

Six Months Ended June 30,

Balance, at the beginning of the period

Additions and adjustments to cost of revenues

Usage and current warranty expenses

Balance, at end of the period

Less current portion

Long term portion

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

DEFERRED REVENUES

Deferred revenues consist of deferred cloud-based monitoring services, communication services, warranty extension services and advance payments received from customers for the Company’s products.

Deferred revenues are classified as short-term and long-term deferred revenues based on the period in which revenues are expected to be recognized.

Significant changes in the balances of deferred revenues during the period are as follows:

Three Months Ended June 30,

Six Months Ended June 30,

Balance, at the beginning of the period

Revenue recognized

Increase in deferred revenues and customer advances

Balance, at the end of the period

Less current portion

Long term portion

The following table includes estimated revenues expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of June 30, 2022:

Total deferred revenues

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

lease liabilities

for legal claims

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

Accrued expenses

Government authorities

Operating lease liabilities

Provision for legal claims

Accrual for sales incentives

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

CONVERTIBLE SENIOR NOTES

September 25, 2020, the Company sold $ 632,500

aggregate principal amount of its 0.00 %

convertible senior notes due 2025 (the “Notes”).

The Notes were sold pursuant to an indenture, dated September 25, 2020 (the

“Indenture”), between the Company and U.S.

On September 25, 2020, the Company sold $ 632,500 aggregate principal amount of its 0.00 % convertible senior notes due 2025 (the “Notes”).

The Notes were sold pursuant to an indenture, dated September 25, 2020 (the “Indenture”), between the Company and U.S.

Bank National Association, as trustee.

The Notes do not bear regular interest and

mature on September

15, 2025 , unless earlier repurchased or converted in accordance with their terms.

The Notes are general senior unsecured

obligations of the Company.

Holders may convert their Notes prior to the close of business on the business day immediately preceding June

15, 2025 in multiples of $ 1,000

principal amount, only under the following circumstances:

(1) during any calendar quarter commencing after the calendar quarter ending

on December 31, 2020 (and only during such calendar quarter), if the last reported sale price of the common stock for at least 20 trading

days (whether or not consecutive) during the period of 30 consecutive trading days ending on, and including, the last trading day of the

immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day;

the five-business-day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of the

Notes for each trading day of that five consecutive trading day period was less than 98% of the product of the last reported sale price

of the common stock and the conversion rate on each such trading day;

or (3) upon the occurrence of specified corporate events as described

in the Indenture.

In addition, holders may convert their Notes, in multiples of $1,000 principal amount, at their option at any time beginning

on or after June 15, 2025, and prior to the close of business on the second scheduled trading day immediately preceding the stated maturity

date of the Notes, without regard to the foregoing circumstances.

The initial conversion rate for the Notes was 3.5997

shares of common stock per $ 1,000

principal amount of Notes, which is equivalent to an initial conversion price of approximately $ 277.80

per share of common stock, subject to adjustment upon the occurrence of certain specified events as set forth in the Indenture .

conversion, the Company may choose to pay or deliver, as the case may be, cash, shares of common stock or a combination of cash and shares

of common stock.

addition, upon the occurrence of a fundamental change (as defined in the Indenture), holders of the Notes may require the Company to repurchase

all or a portion of their Notes, in multiples of $1,000 principal amount, at a repurchase price of 100% of the principal amount of the

Notes, plus any accrued and unpaid special interest to, but excluding the fundamental change repurchase date.

If certain fundamental changes

referred to as make-whole fundamental changes occur, the conversion rate for the Notes may be increased.

Convertible Senior Notes consisted of the following as of March 31, 2022 and December 31, 2021:

issuance costs

carrying amount

the three months ended March 31, 2022 and 2021 the Company recorded issuance costs related to the Notes in the amount of $ 728

respectively.

of March 31, 2022, the issuance costs of the Notes will be amortized over the remaining term of approximately 3.5

annual effective interest rate of the liability component is 0.47 %.

of March 31, 2022, the estimated fair value of the Notes, which the Company has classified as Level 2 financial instruments, is $ 878,985 .

The estimated fair value was determined based on the quoted bid price of the Notes in an over-the-counter market on the last trading day

of the reporting period.

of March 31, 2022, the if-converted value of the Notes exceeded the principal amount by $ 246,485 .

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

The Notes do not bear regular interest and mature on September 15, 2025 , unless earlier repurchased or converted in accordance with their terms.

The Notes are general senior unsecured obligations of the Company.

Holders may convert their Notes prior to the close of business on the business day immediately preceding June 15, 2025 in multiples of $ 1,000 principal amount, only under the following circumstances:

(1) during any calendar quarter commencing after the calendar quarter ending on December 31, 2020 (and only during such calendar quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day;

(2) during the five-business-day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of the Notes for each trading day of that five consecutive trading day period was less than 98% of the product of the last reported sale price of the common stock and the conversion rate on each such trading day;

or (3) upon the occurrence of specified corporate events as described in the Indenture.

In addition, holders may convert their Notes, in multiples of $1,000 principal amount, at their option at any time beginning on or after June 15, 2025, and prior to the close of business on the second scheduled trading day immediately preceding the stated maturity date of the Notes, without regard to the foregoing circumstances.

The initial conversion rate for the Notes was 3.5997 shares of common stock per $ 1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $ 277.80 per share of common stock, subject to adjustment upon the occurrence of certain specified events as set forth in the Indenture.

Upon conversion, the Company may choose to pay or deliver, as the case may be, cash, shares of common stock, or a combination of cash and shares of common stock.

In addition, upon the occurrence of a fundamental change (as defined in the Indenture), holders of the Notes may require the Company to repurchase all or a portion of their Notes, in multiples of $1,000 principal amount, at a repurchase price of 100% of the principal amount of the Notes, plus any accrued and unpaid special interest to, but excluding the fundamental change repurchase date.

If certain fundamental changes referred to as make-whole fundamental changes occur, the conversion rate for the Notes may be increased.

The Convertible Senior Notes consisted of the following as of June 30, 2022 and December 31, 2021:

Unamortized issuance costs

Net carrying amount

For the three months ended June 30, 2022 and 2021 the Company recorded issuance costs related to the Notes in the amount of $ 728 and $ 726 , respectively.

For the six months ended June 30, 2022 and 2021 the Company recorded issuance costs related to the Notes in the amount of $ 1,456 and $ 1,450 , respectively.

As of June 30, 2022, the issuance costs of the Notes will be amortized over the remaining term of approximately 3.2 years.

The annual effective interest rate of the Notes is 0.47 %.

As of June 30, 2022, the estimated fair value of the Notes, which the Company has classified as Level 2 financial instruments, is $ 755,920 .

The estimated fair value was determined based on the quoted bid price of the Notes in an over-the-counter market on the last trading day of the reporting period.

As of June 30, 2022, the if-converted value of the Notes did not exceed the principal amount.

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

STOCK CAPITAL

Common stock rights:

stock confers upon its holders the right to receive notice of, and to participate in, all general meetings of the Company, where each

share of common stock shall have one vote for all purposes;

to share equally, on a per share basis, in bonuses, profits, or distributions

out of fund legally available therefor;

and to participate in the distribution of the surplus assets of the Company in the event of liquidation

of the Company.

Common stock confers upon its holders the right to receive notice of, and to participate in, all general meetings of the Company, where each share of common stock shall have one vote for all purposes;

to share equally, on a per share basis, in bonuses, profits, or distributions out of fund legally available therefor;

and to participate in the distribution of the surplus assets of the Company in the event of liquidation of the Company.

Secondary public offering:

March 17, 2022, the Company offered and sold 2,300,000

shares of the Company’s common stock, at a public offering price of $ 295.00

The shares of Common Stock were issued and sold pursuant to the underwriting agreement dated March 17, 2022 among the Company, Goldman

On March 17, 2022, the Company offered and sold 2,300,000 shares of the Company’s common stock, at a public offering price of $ 295.00 per share.

The shares of Common Stock were issued and sold in a registered offering pursuant to the underwriting agreement dated March 17, 2022, among the Company, Goldman Sachs & Co.

Morgan Securities LLC, and Morgan Stanley & Co.

LLC (the “Underwriting Agreement”).

offered shares were issued at closing, including 300,000

shares of Common Stock that were issued and sold pursuant to the underwriters’ option to purchase additional shares under the Underwriting

Agreement, which was exercised in full on March 18, 2022.

The shares of Common Stock were issued and sold pursuant to the Company’s

Registration Statement on Form S-3, which became effective upon filing with the Securities and Exchange Commission on February 22, 2022,

the related prospectus dated February 22, 2022, and the prospectus supplement dated March 17, 2022.

net proceeds to the Company after underwriters' discounts and commissions of $ 27,140

of offering costs was $ 650,526 .

All of the offered shares were issued at closing, including 300,000 shares of Common Stock that were issued and sold pursuant to the underwriters’ option to purchase additional shares under the Underwriting Agreement, which was exercised in full on March 18, 2022.

The net proceeds to the Company were $ 650,526 after deducting underwriters' discounts of $ 27,140 and commissions of $ 834 .

Equity Incentive Plans:

Company’s 2007 Global Incentive Plan (the “2007 Plan”) was adopted by the board of directors on August 30, 2007.

2007 Plan terminated upon the Company’s IPO on March 31, 2015 and no further awards may be granted thereunder.

All outstanding awards

will continue to be governed by their existing terms and 379,358

available options for future grant were transferred to the Company’s 2015 Global Incentive Plan (the “2015 Plan”) and

are reserved for future issuances under the 2015 plan.

The Company’s 2007 Global Incentive Plan (the “2007 Plan”) was adopted by the board of directors on August 30, 2007.

The 2007 Plan terminated upon the Company’s IPO on March 31, 2015 and no further awards may be granted thereunder.

All outstanding awards will continue to be governed by their existing terms and 379,358 available options for future grant were transferred to the Company’s 2015 Global Incentive Plan (the “2015 Plan”) and are reserved for future issuances under the 2015 plan.

The 2015 Plan became effective upon the consummation of the IPO.

The 2015 Plan

provides for the grant of options, restricted stock units ("RSU"), performance stock units ("PSU"), and other share-based awards to directors,

employees, officers and non-employees of the Company and its subsidiaries.

As of March 31, 2022, a total of 18,047,085

shares of common stock were reserved for issuance pursuant to stock awards under the 2015 Plan (the “Share Reserve”).

Share Reserve will automatically increase on January 1 st of

each year during the term of the 2015 Plan, commencing on January 1 st

of the year following the year in which the 2015 Plan becomes effective, in an amount equal to 5 %

of the total number of shares of capital stock outstanding on December 31 st

of the preceding calendar year;

provided, however, that the Company’s board of directors may determine that there will not be a

January 1 st increase in the Share Reserve in a given year or

that the increase will be less than 5% of the shares of capital stock outstanding on the preceding December 31 st .

Company granted under its 2015 Plan, PSU awards to certain employees and officers which vest upon the achievement of certain performance

or market conditions subject to their continued employment with the Company.

market condition for the PSUs is based on the Company’s total shareholder return ("TSR") compared to the TSR of companies listed

in the S&P 500 index over a one to three year performance period.

The Company uses a Monte-Carlo simulation to determine the grant

date fair value for these awards, which takes into consideration the market price of a share of the Company’s common stock on the

date of grant less the present value of dividends expected during the requisite service period, as well as the possible outcomes pertaining

to the TSR market condition.

The 2015 Plan provides for the grant of options, restricted stock units ("RSU"), performance stock units ("PSU"), and other share-based awards to directors, employees, officers, and non-employees of the Company and its subsidiaries.

As of June 30, 2022, a total of 18,047,085 shares of common stock were reserved for issuance pursuant to stock awards under the 2015 Plan (the “Share Reserve”).

The Share Reserve will automatically increase on January 1 st of each year during the term of the 2015 Plan, commencing on January 1 st of the year following the year in which the 2015 Plan becomes effective, in an amount equal to 5 % of the total number of shares of capital stock outstanding on December 31 st of the preceding calendar year;

provided, however, that the Company’s board of directors may determine that there will not be a January 1 st increase in the Share Reserve in a given year or that the increase will be less than 5% of the shares of capital stock outstanding on the preceding December 31 st .

The Company granted under its 2015 Plan, PSU awards to certain employees and officers which vest upon the achievement of certain performance or market conditions subject to their continued employment with the Company.

The market condition for the PSUs is based on the Company’s total shareholder return ("TSR") compared to the TSR of companies listed in the S&P 500 index over a one to three year performance period.

The Company uses a Monte-Carlo simulation to determine the grant date fair value for these awards, which takes into consideration the market price of a share of the Company’s common stock on the date of grant less the present value of dividends expected during the requisite service period, as well as the possible outcomes pertaining to the TSR market condition.

The Company recognizes such compensation expenses on an accelerated vesting method.

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

CAPITAL (Cont.)

aggregate maximum number of shares of common stock that may be issued on the exercise of incentive stock options is 10,000,000 .

As of March 31, 2022, an aggregate of 8,617,974

options are still available for future grant under the 2015 Plan.

summary of the activity in stock options and related information is as follows:

average exercise price

average remaining contractual term in years

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

The aggregate maximum number of shares of common stock that may be issued on the exercise of incentive stock options is 10,000,000 .

As of June 30, 2022, an aggregate of 8,617,974 options are still available for future grant under the 2015 Plan.

A summary of the activity in stock options and related information is as follows:

Weighted average exercise price

Weighted average remaining contractual

term in years

intrinsic Value

Outstanding as of December 31, 2021

Outstanding as of March

Vested and expected to

vest as of March 31, 2022

Exercisable as of March

aggregate intrinsic value in the tables above represents the total intrinsic value (the difference between the fair value of the Company’s

common stock as of the last day of each period and the exercise price, multiplied by the number of in-the-money options) that would have

been received by the option holders had all option holders exercised their options on the last day of each period.

summary of the activity in the RSUs and related information is as follows:

average grant date fair value

as of December 31, 2021

as of March 31, 2022

summary of the activity in the PSUs and related information is as follows:

average grant date fair value

as of December 31, 2021

as of March 31, 2022

Forfeited or expired

Outstanding as of June 30, 2022

Vested and expected to vest as of June 30, 2022

Exercisable as of June 30, 2022

The aggregate intrinsic value in the tables above represents the total intrinsic value (the difference between the fair value of the Company’s common stock as of the last day of each period and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on the last day of each period.

A summary of the activity in the RSUs and related information is as follows:

average grant

date fair value

Unvested as of December 31, 2021

Unvested as of June 30, 2022

A summary of the activity in the PSUs and related information is as follows:

average grant

date fair value

Unvested as of December 31, 2021

Unvested as of June 30, 2022

Employee Stock Purchase Plan:

Company adopted an ESPP effective upon the consummation of the IPO.

As of March 31, 2022, a total of 3,662,737

shares were reserved for issuance under this plan.

The number of shares of common stock reserved for issuance under the ESPP will increase

automatically on January 1st of each year, for ten years, by the lesser of 1 %

of the total number of shares of the Company’s common stock outstanding on December 31st of the preceding calendar year or 487,643

However, the Company’s board of directors may reduce the amount of the increase in any particular year at their discretion,

including a reduction to zero.

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

CAPITAL (Cont.)

ESPP is implemented through an offering every six months.

According to the ESPP, eligible employees may use up to 15 %

of their salaries to purchase common stock up to an aggregate limit of $ 15

per participant for every six months plan.

The price of an ordinary share purchased under the ESPP is equal to 85 %

of the lower of the fair market value of the ordinary share on the subscription date of each offering period or on the purchase date.

of March 31, 2022, 661,827

shares of common stock had been purchased under the ESPP.

of March 31, 2022, 3,000,910

shares of common stock were available for future issuance under the ESPP.

accordance with ASC No.

The Company adopted an ESPP effective upon the consummation of the IPO.

As of June 30, 2022, a total of 3,662,737 shares were reserved for issuance under this plan.

The number of shares of common stock reserved for issuance under the ESPP will increase automatically on January 1st of each year, for ten years, by the lesser of 1 % of the total number of shares of the Company’s common stock outstanding on December 31st of the preceding calendar year or 487,643 shares.

However, the Company’s board of directors may reduce the amount of the increase in any particular year at their discretion, including a reduction to zero.

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

The ESPP is implemented through an offering every six months.

According to the ESPP, eligible employees may use up to 15 % of their salaries to purchase common stock up to an aggregate limit of $ 15 per participant for every six months plan.

The price of an ordinary share purchased under the ESPP is equal to 85 % of the lower of the fair market value of the ordinary share on the subscription date of each offering period or on the purchase date.

As of June 30, 2022, 696,852 shares of common stock had been purchased under the ESPP.

As of June 30, 2022, 2,965,885 shares of common stock were available for future issuance under the ESPP.

In accordance with ASC No.

718, the ESPP is compensatory and, as such, results in recognition of compensation cost.

Stock-based compensation expenses:

Company recognized stock-based compensation expenses related to all stock-based awards in the consolidated statement of income for the

three months ended March 31, 2022, and 2021, as follows:

Months Ended March 31,

and development

and marketing

and administrative

stock-based compensation expenses

total tax benefit associated with share-based compensation for the three months ended March 31, 2022 and 2021 was $ 3,478

and $ 4,397 ,

respectively.

The tax benefit realized from share-based compensation for three months ended March 31, 2022 and 2021 was $ 2,927

and $ 2,749 ,

respectively.

of March 31, 2022, there were total unrecognized compensation expenses in the amount of $ 308,373

related to non-vested equity-based compensation arrangements granted under the Company’s plans and non-plan awards.

These expenses

are expected to be recognized during the period from April 1, 2022 through October 31, 2026.

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

AND CONTINGENT LIABILITIES

of March 31, 2022, contingent liabilities exist regarding guarantees in the amounts of $ 6,284

in respect of office rent lease agreements and other transactions, respectively.

The Company recognized stock-based compensation expenses related to all stock-based awards in the consolidated statement of income for the three and six months ended June 30, 2022, and 2021, as follows:

Three Months Ended June 30,

Six Months Ended June 30,

Cost of revenues

Research and development

Selling and marketing

General and administrative

Total stock-based compensation expenses

An immaterial amount of stock-based compensation was capitalized to prepaid expenses during the three and six months ended June 30, 2022.

The total tax benefit associated with share-based compensation for the three months ended June 30, 2022 and 2021 was $ 3,058 and $ 2,062 , respectively.

The tax benefit realized from share-based compensation for the three months ended June 30, 2022, and 2021 was $ 2,885 and $ 2,931 , respectively.

The total tax benefit associated with share-based compensation for the six months ended June 30, 2022, and 2021 was $ 6,536 and $ 6,459 , respectively.

The tax benefit realized from share-based compensation for the six months ended June 30, 2022, and 2021 was $ 5,812 and $ 5,680 , respectively.

As of June 30, 2022, there were total unrecognized compensation expenses in the amount of $ 306,131 related to non-vested equity-based compensation arrangements granted under the Company’s plans and non-plan awards.

These expenses are expected to be recognized during the period from July 1, 2022, through May 31, 2026.

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

COMMITMENTS AND CONTINGENT LIABILITIES

As of June 30, 2022, contingent liabilities exist regarding guarantees in the amounts of $ 5,892 , $ 2,815 , and $ 1,388 in respect of office rent lease agreements, projects with customers, and other transactions, respectively.

Contractual purchase obligations:

Company has contractual obligations to purchase goods and raw materials.

These contractual purchase obligations relate to inventories

and other purchase orders, which cannot be canceled without penalty.

In addition, the Company acquires raw materials or other goods and

services, including product components, by issuing authorizations to its suppliers to purchase materials based on its projected demand

and manufacturing needs.

of March 31, 2022, the Company had non-cancelable purchase obligations totaling approximately $ 1,426,689 ,

out of which the Company recorded a provision for loss in the amount of $ 4,745 .

of March 31, 2022, the Company had contractual obligations for capital expenditures totaling approximately $ 144,201 .

These commitments reflect purchases of automated assembly lines and other machinery related to the Company’s manufacturing process

as well as capital expenditures associated with the construction of Sella 2, the Company’s planned second lithium-ion cell and battery

factory in Korea.

The Company has contractual obligations to purchase goods and raw materials.

These contractual purchase obligations relate to inventories and other purchase orders, which cannot be canceled without penalty.

In addition, the Company acquires raw materials or other goods and services, including product components, by issuing authorizations to its suppliers to purchase materials based on its projected demand and manufacturing needs.

As of June 30, 2022, the Company had non-cancelable purchase obligations totaling approximately $ 1,532,469 , out of which the Company recorded a provision for loss in the amount of $ 5,408 .

As of June 30, 2022, the Company had contractual obligations for capital expenditures totaling approximately $ 92,915 .

These commitments reflect purchases of automated assembly lines and other machinery related to the Company’s manufacturing process as well as capital expenditures associated with the construction of Sella 2, the Company’s second lithium-ion cell and battery factory in Korea.

Legal claims:

time to time, the Company may be involved in various claims and legal proceedings.

The Company reviews the status of each matter and assesses

its potential financial exposure.

If the potential loss from any claim or legal proceeding is considered probable and the amount can be

reasonably estimated, the Company accrues a liability for the estimated loss.

These accruals are reviewed at least quarterly and adjusted

to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a

particular matter.

September 2018, the Company’s German subsidiary, SolarEdge Technologies GmbH received a complaint filed by competitor SMA Solar

Technology AG (“SMA”).

The complaint, filed in the District Court Düsseldorf, Germany, alleges that SolarEdge's 12.5kW

- 27.6kW inverters infringe two of the plaintiff’s patents.

SMA asserted a value in dispute of EUR 5.5

million (approximately $ 6,102 )

for both patents.

From time to time, the Company may be involved in various claims and legal proceedings.

The Company reviews the status of each matter and assesses its potential financial exposure.

If the potential loss from any claim or legal proceeding is considered probable and the amount can be reasonably estimated, the Company accrues a liability for the estimated loss.

These accruals are reviewed at least quarterly and adjusted to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular matter.

In September 2018, the Company’s German subsidiary, SolarEdge Technologies GmbH received a complaint filed by competitor SMA Solar Technology AG (“SMA”).

The complaint, filed in the District Court Düsseldorf, Germany, alleges that SolarEdge's 12.5kW - 27.6kW inverters infringe two of the plaintiff’s patents.

SMA asserted a value in dispute of EUR 5.5 million (approximately $ 5,714 ) for both patents.

The Company challenged the validity of both patents.

With respect to one of the claims, in October 2020, the German

Patent Court rendered the SMA patent invalid and this invalidity has been appealed by SMA.

With respect to the other claim, in November

2019, the first instance court stayed the infringement proceedings since it considered it to be highly likely that the second SMA patent

would also be rendered invalid.

The Company believes that it has meritorious defenses to the claims asserted and intends to vigorously

defend against the remaining lawsuit.

May 2019, the Company’s two Chinese subsidiaries and its equipment manufacturer in China were served with three lawsuits by Huawei

Technologies Co., Ltd., a Chinese entity (“Huawei”).

The lawsuits, filed in the Guangzhou intellectual property court, alleged

infringement of three patents and asked for an injunction of manufacture, use, sale and offer for sale, and damage awards.

A first-instance

judgment was issued on August 7, 2020 ordering the three defendants to collectively pay damages in the amount of approximately Chinese

Yuan (“CNY”) 10.5

million (approximately $ 1,658 ),

including court fees.

The Company has filed an appeal with the Supreme People’s Court of China.

The Company's appeal to the Supreme

People's Court was denied in December of 2021, rendering a payment by us to Huawei in an amount of $ 1,658 .

The judgement has not been enforced.

In addition, in January 2021, Huawei filed a motion to increase its claimed monetary damages to CNY

million (approximately $ 7,975 )

with respect to the second lawsuit.

In February 2021, a preliminary injunction was rendered by the Guangzhou intellectual property court

with respect to such second lawsuit and applying to seven inverter models.

In line with the court’s mandate, the Company took immediate

action to make software changes to meet the court order.

In addition, in February 22, 2021 a first-instance judgment was issued ordering

payment of damages in the amount of CNY 50.5

million (approximately $ 7,975 ),

including court fees, with respect to the second patent.

The Company appealed this judgement with the Supreme People’s Court which

case is still pending.

The first instance court’s judgement is not effective or enforceable pending the appeal.

In October 2021,

a first-instance judgment was issued ordering to pay damages in the amount of approximately CNY 10.5

million (approximately $ 1,658 ),

including court fees, with respect to the third lawsuit.

The Company has filed an appeal with the Supreme People’s Court of China

which also is still pending.

The first instance court’s judgement is not effective or enforceable pending the appeal.

believes that it has meritorious defenses to the claims asserted by Huawei.

December 2019, the Company received a lawsuit filed by a former consultant of the Company and its Israeli subsidiary in the amount of

million (approximately $ 8,029 )

claiming damages caused relating to a terminated consulting agreement and stock options therein.

The Company believes it has meritorious

defenses to the claims asserted and intends to vigorously defend against this lawsuit.

of March 31, 2022, accrued amounts for legal claims of $ 11,476

were recorded in accrued expenses and other current liabilities.

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

OTHER COMPREHENSIVE LOSS

following table summarizes the changes in accumulated balances of other comprehensive gain (loss), net of taxes:

gains (losses) on available-for-sale marketable securities

on revaluation

comprehensive loss before reclassifications

With respect to one of the claims, in October 2020, the German Patent Court rendered the SMA patent invalid and this invalidity has been appealed by SMA.

With respect to the other claim, in November 2019, the first instance court stayed the infringement proceedings since it considered it to be highly likely that the second SMA patent would also be rendered invalid.

The Company believes that it has meritorious defenses to the claims asserted and intends to vigorously defend against the remaining lawsuit.

In May 2019, the Company was served with three lawsuits by Huawei Technologies Co., Ltd., a Chinese entity (“Huawei”), against its two Chinese subsidiaries and equipment manufacturer in China.

In May 2022, the Company announced that it had agreed on a global patent license agreement with Huawei.

The agreement includes a cross license that covers patents relating to both companies' products and resulted in the settlement of all pending patent litigation between the companies.

In December 2019, the Company received a lawsuit filed by a former consultant of the Company and its Israeli subsidiary in the amount of NIS 25.5 million (approximately $ 7,286 ) claiming damages caused relating to a terminated consulting agreement and stock options therein.

The Company believes it has meritorious defenses to the claims asserted and intends to vigorously defend against this lawsuit.

As of June 30, 2022, accrued amounts for legal claims of $ 141 were recorded in accrued expenses and other current liabilities.

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

ACCUMULATED OTHER COMPREHENSIVE LOSS

The following table summarizes the changes in accumulated balances of other comprehensive gain (loss), net of taxes:

Three Months Ended June 30,

Six Months Ended June 30,

Unrealized gains (losses) on available-for-sale marketable securities

Beginning balance

Tax on revaluation

Other comprehensive loss before reclassifications

Reclassification

on reclassification

reclassified from accumulated other comprehensive income

current period other comprehensive loss

gains (losses) on cash flow hedges

Tax on reclassification

Losses reclassified from accumulated other comprehensive income

Net current period other comprehensive loss

Ending balance

Unrealized gains (losses) on cash flow hedges

Beginning balance

Tax on revaluation

Other comprehensive loss

before reclassifications

Other comprehensive loss before reclassifications

Reclassification

on reclassification

Losses reclassified from

accumulated other comprehensive loss

Net current period other

comprehensive loss

currency translation adjustments on intra-entity transactions that are of a long-term investment in nature

on revaluation

comprehensive loss before reclassifications

current period other comprehensive loss

gains (losses) on foreign currency translation

on revaluation

comprehensive loss before reclassifications

current period other comprehensive loss

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

OTHER COMPREHENSIVE LOSS (Cont.)

following table summarizes the changes in "Accumulated other comprehensive loss", net of taxes:

about Accumulated Other Comprehensive Loss Components

Line Item in the Statement of Income

losses on available-for-sale marketable securities

net of income taxes

losses on cash flow hedges, net

and development

and marketing

and administrative

before income taxes

reclassifications for the period

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

following table presents the computation of basic and diluted EPS:

Months Ended March 31,

used in computing net earnings per share of common stock, basic

income attributable to common stock, basic

income attributable to common stock, diluted

used in computing net earnings per share of common stock, basic

of stock-based awards

used in computing net earnings per share of common stock, diluted

shares were excluded from the calculation for the three months ended March 31, 2022 and 2021.

OPERATING EXPENSES

the three months ended March 31, 2021, the Company recorded a write-off of long-lived assets in the amount of $ 2,209 .

effective tax rate for the three months ended March 31, 2022 and 2021 was 27.1 %

respectively.

increase in the effective tax rate in the three months ended March 31, 2022, is primarily due to a different allocation of income among

the Company’s US, Israeli, and foreign subsidiaries and the change to Section 174 of the U.S Internal Revenue Code, which went into

effect on January 1, 2022.

The change eliminates the option to deduct research and development expenditures currently and requires taxpayers

to amortize them over five years (if generated from a US entity) and fifteen years (if generated from non-US entities).

This change resulted

in an increase in the Company’s taxable income and Global Intangible Low Taxed Income (“GILTI”) tax.

of March 31, 2022, and December 31, 2021, unrecognized tax benefits were $ 2,303

and $ 2,192 ,

respectively.

Tax on reclassification

Losses reclassified from accumulated other comprehensive loss

Net current period other comprehensive loss

Ending balance

Foreign currency translation adjustments on intra-entity transactions that are of a long-term investment in nature

Beginning balance

Ending balance

Unrealized gains (losses) on foreign currency translation

Beginning balance

Ending balance

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

The following table summarizes the changes in "Accumulated other comprehensive loss", net of taxes:

Details about Accumulated Other Comprehensive Loss Components

Three Months Ended June 30,

Six Months Ended June 30,

Affected Line Item in the Statement of Income

Unrealized losses on available-for-sale marketable securities

Financial expense, net

Total, net of income taxes

Unrealized losses on cash flow hedges, net

Cost of revenues

Research and development

Sales and marketing

General and administrative

Total, before income taxes

Total, net of income taxes

Total reclassifications for the period

OTHER OPERATING EXPENSES

The following table presents the expenses recorded in the three and six months ended June 30, 2022, and 2021:

Three Months Ended June 30,

Six Months Ended June 30,

Impairment of goodwill and intangible assets (1)

Write-off of property, plant and equipment

Kokam purchase escrow (2)

Total other operating expenses (income)

(1) In June 2022, the Company decided to discontinue its stand-alone Critical Power activities.

The Company wrote-off goodwill and intangible assets related to its Critical Power business in an amount of $ 4,008 , see also Note 1b.

(2) In the three and six months ended June 30, 2021, the Company received a payment of $ 859 out of the Kokam acquisition escrow (“the escrow”), with regards to a working capital adjustment.

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

The effective tax rate for the three months ended June 30, 2022, and 2021 was 30.5 % and 16.2 %, respectively, and for the six months ended June 30, 2022, and 2021 the effective tax rate was 28.2 % and 18.2 %, respectively.

The increase in the effective tax rate in the current year, is primarily due to a different allocation of income among the Company’s US, Israeli, and foreign subsidiaries and the change to Section 174 of the U.S Internal Revenue Code, which went into effect on January 1, 2022.

The change eliminates the option to deduct research and development expenditures currently and requires taxpayers to amortize them over five years (if generated from a US entity) and fifteen years (if generated from non-US entities).

This change resulted in an increase in the Company’s taxable income and Global Intangible Low Taxed Income (“GILTI”) tax.

As of June 30, 2022, and December 31, 2021, unrecognized tax benefits were $ 2,403 and $ 2,192 , respectively.

If recognized, such benefits would favorably affect the Company’s effective tax rate.

Company accrues interest and penalties related to unrecognized tax benefits in its provision for income taxes.

The total amount of penalties

and interest were immaterial as of March 31, 2022, and December 31, 2021.

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

SEGMENT, GEOGRAPHIC AND PRODUCT INFORMATION (Cont.)

Company operates in five different operating segments:

The Company accrues interest and penalties related to unrecognized tax benefits in its provision for income taxes.

The total amount of penalties and interest were immaterial as of June 30, 2022, and December 31, 2021.

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

EARNINGS PER SHARE

The following table presents the computation of basic and diluted earnings per share (“EPS”):

Three Months Ended June 30,

Six Months Ended June 30,

Shares used in computing net EPS of common stock, basic

Net income attributable to common stock, basic

Notes due 2025

Net income attributable to common stock, diluted

Shares used in computing net EPS of common stock, basic

Notes due 2025

Effect of stock-based awards

Shares used in computing net EPS of common stock, diluted

Shares excluded from the calculation of diluted net EPS due to their anti-dilutive effect

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

SEGMENT, GEOGRAPHIC AND PRODUCT INFORMATION

The Company operates in five different operating segments:

Solar, Energy Storage, e-Mobility, Critical Power and Automation Machines.

Company's Chief Executive Officer, who is the chief operating decision maker (“CODM”), makes resource allocation decisions

and assesses performance based on financial information presented on a consolidated basis, accompanied by disaggregated information about

revenues and contributed profit by the operating segments.

Company does not allocate to its operating segments revenue recognized due to advance payments received for performance obligations that

extend for a period greater than one year, related to Accounting Standard Codification 606, “Revenue from Contracts with Customers”

profit is comprised of gross profit for the segment less operating expenses that do not include amortization of purchased intangible assets,

stock based compensation expenses and certain other items.

Company manages its assets on a group basis, not by segments, as many of its assets are shared or co-mingled.

The Company’s CODM

does not regularly review asset information by segments and, therefore, the Company does not report asset information by segment.

Company identified one operating segment as reportable – the Solar segment.

The other operating segments are insignificant individually

and therefore their results are presented together under “All other”.

Solar segment includes the design, development, manufacturing, and sales of an intelligent inverter solution designed to maximize power

generation at the individual PV module level and a residential storage solution, compatible with the Company’s energy hub inverter,

intended to store and supply power for back-up and to maximize self-consumption.

The Solar segment solution consists mainly of the Company’s

power optimizers, inverters, batteries and cloud‑based monitoring platform.

“All other” category includes the design, development, manufacturing and sales of energy storage products, e-Mobility products,

UPS products and automated machines.

following table presents information on reportable segments profit (loss) for the period presented:

Months Ended March 31,

In June 2022, the Company decided to discontinue its stand-alone Critical Power activities, see also Note 1b.

The Company's Chief Executive Officer, who is the chief operating decision maker (“CODM”), makes resource allocation decisions and assesses performance based on financial information presented on a consolidated basis, accompanied by disaggregated information about revenues and contributed profit by the operating segments.

The Company does not allocate to its operating segments revenue recognized due to advance payments received for performance obligations that extend for a period greater than one year, related to Accounting Standard Codification 606, “Revenue from Contracts with Customers” (ASC 606).

Segment profit is comprised of gross profit for the segment less operating expenses that do not include amortization of purchased intangible assets, impairments of goodwill and intangible assets, stock based compensation expenses, and certain other items.

The Company manages its assets on a group basis, not by segments, as many of its assets are shared or co-mingled.

The Company’s CODM does not regularly review asset information by segments and, therefore, the Company does not report asset information by segment.

The Company identified one operating segment as reportable – the Solar segment.

The other operating segments are insignificant individually and therefore their results are presented together under “All other”.

The Solar segment includes the design, development, manufacturing, and sales of an intelligent inverter solution designed to maximize power generation at the individual PV module level and a residential storage solution, compatible with the Company’s energy hub inverter, intended to store and supply power for back-up and to maximize self-consumption.

The Solar segment solution consists mainly of the Company’s power optimizers, inverters, batteries, and cloud‑based monitoring platform.

The “All other” category includes the design, development, manufacturing, and sales of energy storage products, e-Mobility products, UPS products, and automated machines.

The following table presents information on reportable segments profit (loss) for the period presented:

Three Months Ended

June 30, 2022

Six Months Ended

June 30, 2022

Cost of revenues

Gross profit (loss)

Research and development

2 unchanged sentences

Segments profit (loss)

SOLAREDGE TECHNOLOGIES

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands,

except per share data)

SEGMENT, GEOGRAPHIC AND PRODUCT INFORMATION

following table presents information on reportable segments reconciliation to consolidated revenues for the periods presented:

Months Ended March 31,

other revenues

from services ASC 606

following table presents information on reportable segments reconciliation to consolidated operating income for the periods presented:

Months Ended March 31,

SOLAREDGE TECHNOLOGIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

Three Months Ended

June 30, 2021

Six Months Ended

June 30, 2021

Cost of revenues

Research and development

Sales and marketing

General and administrative

Segments profit (loss)

The following table presents information on reportable segments reconciliation to consolidated revenues for the periods presented:

Three Months Ended June 30,

Six Months Ended June 30,

Solar revenues

All other revenues

Revenues from finance component

Consolidated revenues

The following table presents information on reportable segments reconciliation to consolidated operating income for the periods presented:

Three Months Ended June 30,

Six Months Ended June 30,

Solar segment profit

1 unchanged sentence

Segments operating profit

Amounts not allocated

based compensation expenses

unallocated expenses

Consolidated operating

Amounts not allocated to segments:

Stock based compensation expenses

Impairment of goodwill and intangible assets

Disposal of assets related to Critical Power

Other unallocated expenses, net

Consolidated operating income

SUBSEQUENT EVENTS

On July 20, 2022, the Company completed the sale of its investment in AutoGrid and received payment in the amount of $ 24,175 , subject to post-closing adjustments.

On July 28, 2022, the Company received notice that Ampt LLC had filed complaints against SolarEdge Technologies Inc and SolarEdge Technologies Ltd in the U.S.

International Trade Commission and the District Court for the District of Delaware alleging patent infringement.

The Company anticipates a vigorous defense of these new actions.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements