Item 1. Financial Statements
ITEM 1. FINANCIAL STATEMENTS
SOLAREDGE TECHNOLOGIES INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(in thousands, except per share data)
March 31,
2025
December 31,
2024
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
$
401,364
$
274,611
Restricted cash
104,459
135,328
Marketable securities
250,267
311,279
Trade receivables, net of allowances of $ 35,970 and $ 43,038 , respectively
132,577
160,423
Inventories, net
636,597
645,897
Prepaid expenses and other current assets
464,419
523,027
Total current assets
1,989,683
2,050,565
LONG-TERM ASSETS:
Marketable securities
34,051
42,597
Property, plant and equipment, net
339,824
343,438
Operating lease right-of-use assets, net
48,639
41,393
Intangible assets, net
8,874
9,666
Goodwill
48,626
48,380
Loan receivables, net
-
45,678
Other long-term assets
55,476
64,736
Total long-term assets
535,490
595,888
Total assets
$
2,525,173
$
2,646,453
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 1
SOLAREDGE TECHNOLOGIES INC.
CONDENSED CONSOLIDATED BALANCE SHEET S (Unaudited) (Cont.)
(in thousands, except per share data)
March 31,
2025
December 31,
2024
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Trade payables
$
135,435
$
107,543
Employees and payroll accruals
76,360
76,292
Warranty obligations
125,172
140,249
Deferred revenues and customers advances
76,491
140,870
Accrued expenses and other current liabilities
219,496
246,078
Convertible senior notes, net
341,472
346,305
Total current liabilities
974,426
1,057,337
LONG-TERM LIABILITIES:
Convertible senior notes, net
330,389
330,006
Warranty obligations
287,530
292,116
Deferred revenues
243,649
231,049
Finance lease liabilities
37,862
39,159
Operating lease liabilities
33,325
30,018
Other long-term liabilities
23,779
8,426
Total long-term liabilities
956,534
930,774
COMMITMENTS AND CONTINGENT LIABILITIES
STOCKHOLDERS’ EQUITY:
Common stock of $ 0.0001 par value - Authorized: 125,000,000 shares; issued: 59,043,817 shares on
March 31, 2025 and 58,780,490 shares on December 31, 2024; outstanding: 58,290,453 shares on
March 31, 2025 and 58,027,126 shares on December 31, 2024.
6
6
Additional paid-in capital
1,845,719
1,813,198
Treasury stock, at cost; 753,364 shares held
( 50,194
)
( 50,194
)
Accumulated other comprehensive loss
( 74,604
)
( 76,477
)
Accumulated deficit
( 1,126,714
)
( 1,028,191
)
Total stockholders’ equity
594,213
658,342
Total liabilities and stockholders’ equity
$
2,525,173
$
2,646,453
The accompanying notes are an integral part of the condensed consolidated financial statements.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 2
SOLAREDGE TECHNOLOGIES INC.
CONDENSED CONSOLIDATED STATEMENTS OF LOSS (Unaudited)
(in thousands, except per share data)
Three Months Ended
March 31,
2025
2024
Revenues
$
219,480
$
204,399
Cost of revenues
201,944
230,586
Gross profit (loss)
17,536
( 26,187
)
Operating expenses:
Research and development
61,997
75,351
Sales and marketing
31,657
38,911
General and administrative
30,183
30,865
Other operating expense (income), net
( 3,575
)
2,391
Total operating expenses
120,262
147,518
Operating loss
( 102,726
)
( 173,705
)
Financial income (expense), net
10,068
( 7,064
)
Other income, net
148
-
Loss before income taxes
( 92,510
)
( 180,769
)
Tax benefits (income taxes)
( 5,726
)
23,754
Net loss from equity method investments
( 287
)
( 296
)
Net loss
$
( 98,523
)
$
( 157,311
)
Net basic and diluted loss per share of common stock
$
( 1.70
)
$
( 2.75
)
Weighted average number of shares used in computing net basic and diluted loss per share of common stock
58,121,502
57,140,126
The accompanying notes are an integral part of the condensed consolidated financial statements.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 3
SOLAREDGE TECHNOLOGIES INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited)
(in thousands, except per share data)
Three Months Ended
March 31,
2025
2024
Net loss
$
( 98,523
)
$
( 157,311
)
Other comprehensive income (loss), net of tax:
Available-for-sale marketable securities
481
1,491
Cash flow hedges
( 1,146
)
( 2,365
)
Foreign currency translation adjustments on intra-entity transactions that are of a long-term investment nature
( 928
)
( 13,382
)
Foreign currency translation adjustments
3,466
( 5,470
)
Total other comprehensive income (loss)
1,873
( 19,726
)
Comprehensive loss
$
( 96,650
)
$
( 177,037
)
The accompanying notes are an integral part of the condensed consolidated financial statements.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 4
SOLAREDGE TECHNOLOGIES INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)
(in thousands, except per share data)
Common stock
Additional paid in
Capital
Treasury stock
Accumulated
other comprehensive
loss
Accumulated deficit
Total
Number
Amount
Balance as of January 1, 2025
58,027,126
$
6
$
1,813,198
$
( 50,194
)
$
( 76,477
)
$
( 1,028,191
)
$
658,342
Issuance of common stock upon exercise of stock-based awards
263,327
* -
10
-
-
-
10
Stock based compensation
-
-
32,511
-
-
-
32,511
Other comprehensive gain adjustments
-
-
-
-
1,873
-
1,873
Net loss
-
-
-
-
-
( 98,523
)
( 98,523
)
Balance as of March 31, 2025
58,290,453
$
6
$
1,845,719
$
( 50,194
)
$
( 74,604
)
$
( 1,126,714
)
$
594,213
Common stock
Additional paid in
Capital
Treasury stock
Accumulated
other comprehensive
loss
Retained earnings
Total
Number
Amount
Balance as of January 1, 2024
57,123,437
$
6
$
1,680,622
$
-
$
( 46,885
)
$
778,166
$
2,411,909
Issuance of common stock upon exercise of stock-based awards
175,254
* -
13
-
-
-
13
Stock based compensation
-
-
38,888
-
-
-
38,888
Repurchase of common stock
( 505,896
)
* -
-
( 33,222
)
-
-
( 33,222
)
Other comprehensive loss adjustments
-
-
-
-
( 19,726
)
-
( 19,726
)
Net loss
-
-
-
-
-
( 157,311
)
( 157,311
)
Balance as of March 31, 2024
56,792,795
$
6
$
1,719,523
$
( 33,222
)
$
( 66,611
)
$
620,855
$
2,240,551
* Represents an amount less than $1.
The accompanying notes are an integral part of the condensed consolidated financial statements.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 5
SOLAREDGE TECHNOLOGIES INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(in thousands, except per share data)
Three Months Ended
March 31,
2025
2024
Cash flows from operating activities:
Net loss
$
( 98,523
)
$
( 157,311
)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization
12,001
14,988
Stock-based compensation expenses
31,426
37,606
Deferred income taxes, net
( 1,029
)
( 41,847
)
Loss (gain) from exchange rate fluctuations
( 2,930
)
7,799
Other items
2,271
4,371
Changes in assets and liabilities:
Trade receivables, net
29,247
210,376
Inventories, net
12,285
( 105,810
)
Prepaid expenses and other assets
100,361
52,187
Operating lease right-of-use assets, net
3,659
5,255
Trade payables
30,275
( 215,120
)
Warranty obligations
( 19,745
)
( 15,582
)
Deferred revenues and customers advances
( 51,970
)
( 523
)
Operating lease liabilities
( 3,571
)
( 5,219
)
Accrued expenses and other liabilities
( 9,934
)
( 8,189
)
Net cash provided by (used in) operating activities
33,823
( 217,019
)
Cash flows from investing activities:
Investment in available-for-sale marketable securities
( 72,465
)
( 129,221
)
Proceeds from maturities of available-for-sale marketable securities
142,931
319,605
Purchase of property, plant and equipment
( 10,109
)
( 26,347
)
Repayment related to governmental grant
( 6,643
)
-
Disbursements for loans receivables
-
( 7,500
)
Investment in privately-held companies
-
( 8,831
)
Proceeds from loan receivables
13,653
1,625
Other investing activities
230
( 323
)
Net cash provided by investing activities
$
67,597
$
149,008
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 6
SOLAREDGE TECHNOLOGIES INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(in thousands, except per share data)
Three Months Ended
March 31,
2025
2024
Cash flows from financing activities:
Repurchase of common stock
$
-
$
( 33,222
)
Payments on account of repurchase of common stock
-
( 16,778
)
Repurchase of convertible debt
( 5,093
)
-
Other financing activities
( 1,144
)
( 987
)
Net cash used in financing activities
( 6,237
)
( 50,987
)
Effect of exchange rate changes on cash, cash equivalents and restricted cash
701
( 5,241
)
Increase (decrease) in cash, cash equivalents and restricted cash
95,884
( 124,239
)
Cash, cash equivalents and restricted cash, beginning of period
409,939
338,468
Cash, cash equivalents and restricted cash, end of period
$
505,823
$
214,229
Supplemental disclosure of non-cash activities:
Right-of-use asset recognized with a corresponding lease liability
$
10,881
$
1,085
Purchase of property, plant and equipment
$
1,731
$
4,760
The accompanying notes are an integral part of the condensed consolidated financial statements.
The following table reconciles cash, cash equivalents and restricted cash per the statement of cash flows to the balance sheet:
Three Months Ended
March 31,
2025
2024
Cash and cash equivalents
$
401,364
$
214,229
Restricted cash
104,459
-
Cash, cash equivalents and restricted cash, end of period
$
505,823
$
214,229
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 7
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data )
NOTE 1: GENERAL
a.
SolarEdge Technologies Inc. (the “Company”) and its subsidiaries design, develop, and sell intelligent inverter solutions 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 throughout each and every module through constant tracking of maximum power points 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 full or partial home backup capabilities, and optional connection to the Company's smart EV charger, (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) batteries for PV applications that are used to increase energy independence and maximize self-consumption for PV system's owners 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.
b.
Basis of Presentation:
The unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). 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, 2024, contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 25, 2025, 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.
c.
Use of estimates:
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, government grants, income taxes and related disclosures in the accompanying notes. Actual results and outcomes may differ from management’s estimates and assumptions due to risks and uncertainties.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 8
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
d.
Concentrations of supply risks:
The 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.
As of March 31, 2025 two contract manufacturers jointly accounted for 64.3 % of the Company’s total trade payables.
As of December 31, 2024, two contract manufacturers jointly accounted for 43.4 % of the Company’s total trade payables.
The Company's own manufacturing facility, Sella 1, located in the North of Israel, is used in the Company' ongoing operations.
e.
New accounting standards updates:
In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”). ASU 2023-09 requires additional categories of information about federal, state and foreign income taxes to be included in effective tax rate reconciliation disclosure. Additionally, the newly added categories also apply to the income taxes paid disclosure. Implementation of said additions are subject to quantitative thresholds. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. Since ASU 2023-09 addresses only disclosures, the adoption of ASU 2023-09 is not expected to have a significant impact on its consolidated financial statements.
In November 2024, the FASB issued ASU 2024-03, “Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40): “Disaggregation of Income (loss) Statement Expenses” (“ASU 2024-03”). ASU 2024-03 requires disaggregation of certain costs and expenses included in each relevant expense caption on the Company's consolidated income (loss) statements in a separate note to the financial statements at each interim and annual reporting period, including amounts of purchases of inventory, employee compensation, depreciation, and intangible asset amortization. ASU 2024-04 is effective fiscal years beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact from ASU 2024-03 on its consolidated financial statements disclosures.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 9
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 2: MARKETABLE SECURITIES
The following is a summary of available-for-sale marketable securities as of March 31, 2025:
Amortized
cost
Gross unrealized
gains
Gross unrealized
losses
Fair value
Matures within one year:
Corporate bonds
$
199,448
$
56
$
( 271
)
$
199,233
U.S. Treasury securities
35,753
-
( 16
)
35,737
U.S. Government agency securities
10,299
16
( 1
)
10,314
Non-U.S. Government securities
4,990
-
( 7
)
4,983
250,490
72
( 295
)
250,267
Matures after one year:
Corporate bonds
28,847
284
-
29,131
U.S. Government agency securities
4,886
34
-
4,920
33,733
318
-
34,051
Total
$
284,223
$
390
$
( 295
)
$
284,318
The following is a summary of available-for-sale marketable securities as of December 31, 2024:
Amortized
cost
Gross unrealized
gains
Gross unrealized
losses
Fair value
Matures within one year:
Corporate bonds
$
290,570
$
97
$
( 811
)
$
289,856
U.S. Treasury securities
12,596
-
( 2
)
12,594
U.S. Government agency securities
8,810
19
-
8,829
311,976
116
( 813
)
311,279
Matures after one year:
Corporate bonds
36,006
252
( 17
)
36,241
U.S. Government agency securities
6,309
47
-
6,356
42,315
299
( 17
)
42,597
Total
$
354,291
$
415
$
( 830
)
$
353,876
The Company did not sell any available-for-sale marketable securities during the three months ended March 31, 2025 and 2024.
As of March 31, 2025, and December 31, 2024, the Company did not record an allowance for credit losses for its available-for-sale marketable securities.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 10
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 3: INVENTORIES, NET
March 31,
2025
December 31,
2024
Raw materials
$
261,617
$
209,259
Work in process
471
3,113
Finished goods
374,509
433,525
Total inventories, net
$
636,597
$
645,897
NOTE 4: PREPAID EXPENSES AND OTHER CURRENT ASSETS
March 31,
2025
December 31,
2024
Vendor non-trade receivables 1
$
75,116
$
198,211
Government authorities 2
218,382
213,290
Loan receivables, net
33,178
-
Prepayments
27,372
25,291
Assets held for sale
60,145
60,500
Other
50,226
25,735
Total prepaid expenses and other current assets
$
464,419
$
523,027
1 Vendor non-trade receivables derived from the sale of components to manufacturing vendors who manufacture products, components and other testing equipment for the Company. The Company purchases these components directly from other suppliers. The Company does not reflect the sale of these components to the contract manufacturers in its revenues.
2 I ncluding (1) Advanced Manufacturing Production Tax Credits (“AMPTC”), which incentivize the production of eligible components within the U.S. under IRC Section 45X, (2) income tax receivables and (3) value-added tax receivables from tax authorities.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 11
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 5: OTHER LONG TERM ASSETS
March 31,
2025
December 31,
2024
Cloud computing arrangements
$
29,184
$
29,366
Investments in privately held companies
21,265
20,976
Severance pay fund
-
9,185
Prepaid expenses and other
5,027
5,209
Total other long term assets
$
55,476
$
64,736
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 12
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 6: DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
During the three months ended March 31, 2025, the Company instituted a foreign currency cash flow hedging program to reduce the risk of a forecasted increase in the value of foreign currency cash flows, resulting from payment of salaries in Israeli currency, the New Israeli Shekels (“NIS”). The Company hedges portions of the anticipated payroll denominated in NIS for a period of one to nine months with hedging contracts. These hedging contracts are designated as cash flow hedges, as defined by ASC 815 and are all effective hedges.
As of March 31, 2025, the Company entered into forward contracts and put and call options to sell U.S. dollars (“USD”) in the amounts of NIS 44 million and NIS 74 million, respectively.
In addition to the above-mentioned cash flow hedge transactions, the Company occasionally enters into derivative instrument arrangements to hedge the Company’s exposure to currencies other than USD. 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 loss, under “Financial income (expense), net”.
The Company classifies cash flows related to its hedging as operating activities in its condensed consolidated statement of cash flows.
The fair values of outstanding derivative instruments were as follows:
Balance sheet location
March 31,
2025
December 31,
2024
Derivative assets of options and forward contracts:
Designated cash flow hedges
Prepaid expenses and other current assets
$
156
$
1,262
Derivative liabilities of options and forward contracts:
Designated cash flow hedges
Accrued expenses and other current liabilities
$
( 41
)
$
-
Gains (losses) on derivative instruments are summarized below:
Three Months Ended
March 31,
Affected line item
2025
2024
Foreign exchange contracts
Non Designated Hedging Instruments
Condensed Consolidated Statements of Loss - Financial income (expense), net
$
-
$
612
Designated Hedging Instruments
Condensed Consolidated Statements of Comprehensive Loss - Cash flow hedges
$
( 488
)
$
( 1,538
)
See Note 15 for information regarding losses from designated hedging instruments reclassified from accumulated other comprehensive loss.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 13
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 7: FAIR VALUE MEASUREMENTS
In accordance with ASC 820, “Fair Value Measurement”, the Company measures its cash equivalents and marketable securities, at fair value using the market approach valuation technique. Cash and cash equivalents are classified within Level 1 because these assets are valued using quoted market prices. Marketable securities and foreign currency derivative contracts are classified within level 2 due to these assets being valued by alternative pricing sources and models utilizing market observable inputs.
The following table sets forth the Company’s assets that were measured at fair value as of March 31, 2025 and December 31, 2024, by level within the fair value hierarchy:
Fair value measurements as of
Description
Fair Value
Hierarchy
March 31,
2025
December 31,
2024
Assets:
Cash and cash equivalents:
Cash
Level 1
$
367,919
$
239,020
Money market mutual funds
Level 1
$
14,995
$
21,075
Deposits
Level 1
$
18,450
$
14,516
Restricted cash
Level 1
$
104,459
$
135,328
Derivative instruments
Level 2
$
156
$
1,262
Short-term marketable securities:
Corporate bonds
Level 2
$
199,233
$
289,856
U.S. Treasury securities
Level 2
$
35,737
$
12,594
U.S. Government agency securities
Level 2
$
10,314
$
8,829
Non-U.S. Government securities
Level 2
$
4,983
$
-
Long-term marketable securities:
Corporate bonds
Level 2
$
29,131
$
36,241
U.S. Government agency securities
Level 2
$
4,920
$
6,356
Liabilities:
Derivative instruments
Level 2
$
( 41
)
$
-
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 14
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 8: WARRANTY OBLIGATIONS
Changes in the Company’s product warranty obligations for the three months ended March 31, 2025 and 2024, were as follows:
Three Months Ended March 31,
2025
2024
Balance, at the beginning of the period
$
432,365
$
518,244
Accruals for warranty during the period
16,466
18,847
Changes in estimates
( 911
)
106
Settlements
( 35,218
)
( 34,698
)
Balance, at end of the period
412,702
502,499
Less current portion
( 125,172
)
( 181,333
)
Long term portion
$
287,530
$
321,166
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 15
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 9: DEFERRED REVENUES AND CUSTOMERS ADVANCES
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.
Changes in the balances of deferred revenues and customer advances during the period are as follows:
Three Months Ended March 31,
2025
2024
Balance, at the beginning of the period
$
371,919
$
255,443
Revenue recognized
( 80,942
)
( 30,056
)
Increase in deferred revenues and customer advances
29,163
29,229
Balance, at the end of the period
320,140
254,616
Less current portion
( 76,491
)
( 36,081
)
Long term portion
$
243,649
$
218,535
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 March 31, 2025:
2025
$
72,867
2026
14,576
2027
12,539
2028
11,640
2029
11,335
Thereafter
197,183
Total deferred revenues
$
320,140
NOTE 10: ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
March 31,
2025
December 31,
2024
Accrued expenses
$
153,045
$
166,699
Government authorities
29,754
51,705
Operating lease liabilities
15,027
11,861
Accrual for sales incentives
15,600
11,671
Other
6,070
4,142
Total accrued expenses and other current liabilities
$
219,496
$
246,078
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 16
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 11: CONVERTIBLE SENIOR NOTES
On September 25, 2020, the Company sold an aggregate principal amount of $ 632,500 of its 0.00 % convertible senior notes, due 2025 (the “Notes 2025”). The Notes 2025 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 2025 do not bear regular interest and mature on September 15, 2025 , unless earlier repurchased or converted in accordance with their terms. The Notes 2025 are general senior unsecured obligations of the Company. Holders may convert their Notes 2025 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 2025 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 2025, 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 2025, without regard to the foregoing circumstances. The initial conversion rate for the Notes 2025 was 3.5997 shares of common stock per $ 1,000 principal amount of Notes 2025, 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 2025 may require the Company to repurchase all or a portion of their Notes 2025, in multiples of $ 1,000 principal amounts, at a repurchase price of 100% of the principal amount of the Notes 2025, 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 2025 may be increased.
On June 28, 2024, the Company sold an aggregate principal amount of $ 300,000 of its 2.25 % convertible senior notes, due in 2029 (the “Notes 2029”). The Notes 2029 were sold pursuant to an indenture, dated June 28, 2024 (the “Indenture 2029”), between the Company and U.S. Bank National Association, as trustee. The Notes 2029 will bear interest at a rate of 2.25% per year, payable semiannually in arrears on January 1 and July 1 of each year, beginning on January 1, 2025. The Notes 2029 mature on July 1, 2029 , unless repurchased, redeemed or converted in accordance with their terms prior to such date. The Notes 2029 are general senior unsecured obligations of the Company. Holders may convert their Notes 2029 at any time prior to the close of business on the business day immediately preceding April 1, 2029 in multiples of $ 1,000 principal amount, only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on September 30, 2024 (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 2029 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 or if the Company provides a notice of redemption as described in the Indenture 2029. In addition, holders may convert their Notes 2029, in multiples of $1,000 principal amount, at their option at any time beginning on or after April 1, 2029, and prior to the close of business on the second scheduled trading day immediately preceding the stated maturity date of the Notes 2029, without regard to the foregoing circumstances. The initial conversion rate for the Notes 2029 is 29.1375 shares of common stock per $ 1,000 principal amount of Notes 2029, which is equivalent to an initial conversion price of approximately $ 34.32 per share of common stock, subject to adjustment upon the occurrence of certain specified events as set forth in the Indenture 2029.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 17
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
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 2029), holders of the Notes 2029 may require the Company to repurchase all or a portion of their Notes 2029, in multiples of $ 1,000 principal amounts, at a repurchase price of 100% of the principal amount of the Notes 2029, plus any accrued and unpaid interest, if any, up to, but not including, the repurchase date. If certain fundamental changes referred to as make-whole fundamental changes occur, the conversion rate for the Notes 2029 may be increased.
The Notes 2029 are not redeemable prior to July 6, 2027. On or after July 6, 2027, the Company may redeem the Notes 2029 at its option if the last reported sale price of the common stock has been at least 130% of the conversion price, then in effect, for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on and including the trading day immediately preceding the date on which the Company provides notice of redemption, at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, up to, but excluding, the redemption date.
The net proceeds from the offering of the Notes 2029 were approximately $ 293,200 , after deducting fees and estimated expenses. Congruently, the Company has entered into capped call transactions (as detailed below). The Company used approximately $ 25,230 of the net proceeds from this offering to pay the cost of the capped call transactions. The Company also used approximately $ 267,900 of the net proceeds from this offering to repurchase $ 285,000 principal amount of its Notes 2025. In June 2025, the Company recorded under other income a gain of $ 15,456 from the repurchase of Notes 2025.
The Company accounts for the Notes 2029 at amortized cost, as a single unit of account on the balance sheet. The carrying value of the liability is represented by the face amount of the Notes 2029, less debt issuance costs, adjusted for any amortization of issuance costs. Issuance costs are being amortized as interest expense over the term of the Notes 2029, using the effective interest rate method.
The capped call transactions are expected generally to reduce the potential dilution to the common stock upon any conversion of the Notes 2029 and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Notes 2029, as the case may be, in the event that the market price per share of common stock, as measured under the terms of the capped call transactions, is greater than the strike price of the capped call transactions. The strike price initially corresponds to the conversion price of the Notes and is subject to customary anti-dilution adjustments. If, however, the market price per share of common stock exceeds $ 48.84 , the initial cap price of the capped call transactions, there would nevertheless be unmitigated dilution and/or no offset of any cash payments, in each case, attributable to the amount by which the market price of the common stock exceeds the cap price. The cap price is subject to certain customary adjustments under the terms of the capped call transactions.
The capped call transactions are considered a freestanding instrument as they were entered into separately and apart from Notes 2029. In addition, the conversion or redemption of the Notes 2029 would not automatically result in the exercise of the capped call.
As the capped call transactions are indexed to the Company's common stock, they were recorded as a reduction of additional paid-in capital in the condensed consolidated balance sheets.
O n July 8, 2024 the Company sold to Goldman Sachs & Co. LLC, as representative of the several initial purchasers (the “Initial Purchasers”), and the Initial Purchasers purchased from the Company, $ 37,000 aggregate principal amount of additional Notes 2029. The additional Notes 2029 were sold pursuant to the Initial Purchasers’ exercise of the option granted by the Company to the Initial Purchasers to purchase additional Notes 2029, solely to cover over-allotments, under the purchase agreement described in the Company's Form 8-K filed on June 28, 2024.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 18
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
The net proceeds from the exercise of the option granted by the Company to the Initial Purchasers of the Notes 2029 were approximately $ 36,237 , after deducting fees and estimated expenses. Congruently, the Company has entered into additional capped call transactions. The Company used approximately $ 3,111 of the net proceeds from this offering to pay the cost of the additional capped call transactions. The Company intends to use the remainder of the net proceeds from the offering for general corporate purposes.
In March 2025 the Company repurchased $ 5,250 principal amount of its Notes 2025. The Company recorded a net gain of $ 146 , under other income, net, from the repurchase.
The convertible senior notes consisted of the following as of March 31, 2025 and December 31, 2024:
March 31,
2025
December 31,
2024
Notes 2025
Principal
$
342,250
$
347,500
Unamortized issuance costs
( 778
)
( 1,195
)
Net carrying amount Notes 2025
341,472
346,305
Notes 2029
Principal
337,000
337,000
Unamortized issuance costs
( 6,611
)
( 6,994
)
Net carrying amount Notes 2029
330,389
330,006
Total notes carrying amount
$
671,861
$
676,311
Costs related to the Notes 2025 and the Notes 2029 for the three months ended March 31, 2025 and March 31, 2024 were as follows:
Three Months Ended
March 31,
2025
2024
Notes 2025
Debt issuance cost
$
405
$
735
Notes 2029
Debt issuance cost
$
383
$
-
Contractual interest expense
$
1,896
$
-
As of March 31, 2025, the unamortized issuance costs of the Notes 2025 and Notes 2029 will be amortized over the remaining term of approximately 6 months and 4.3 years, respectively.
The annual effective interest rates of the Notes 2025 and the Notes 2029 are 0.47 %. and 2.75 %, respectively.
As of March 31, 2025, the estimated fair values of Notes 2025 and Notes 2029, both of which the Company has classified as Level 2 financial instruments, are $ 331,983 and $ 279,973 , respectively. The estimated fair values were 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 March 31, 2025, the if-converted value of the Notes 2025 and Notes 2029 did not exceed the principal amount.
NOTE 12: OTHER LONG TERM LIABILITIES
March 31,
2025
December 31,
2024
Tax liabilities
$
14,249
$
-
Long term accrued expenses
6,052
-
Accrued severance pay
2,291
6,079
Other
1,187
2,347
$
23,779
$
8,426
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 19
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 13: STOCK CAPITAL
a.
Common stock rights:
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.
b.
Equity Incentive Plans:
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 grants were transferred to the Company’s Amended and Restated 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, 2025, a total of 26,648,950 shares of common stock were reserved for issuance pursuant to stock awards under the 2015 Plan (the “Share Reserve”), an aggregate of 13,058,763 shares are still available for future grants.
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 .
Under its 2015 Plan, the Company granted 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 either the Company’s share price target or total shareholder return (“TSR”) compared to the TSR of companies listed in the S&P 500 index over a two to three year performance period or the 30-day successive average trading price of the Company’s common stock, and are subject to a three-year vesting 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.
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 March 31, 2025, an aggregate of 8,617,974 options are still available for future grants under the 2015 Plan.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 20
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
A summary of the activity in stock options and related information is as follows:
Number of options
Weighted average exercise price
Weighted average remaining contractual term in years
Aggregate intrinsic Value
Outstanding as of December 31, 2024
283,419
$
59.16
3.42
$
17
Exercised
( 2,000
)
5.01
-
16
Outstanding as of March 31, 2025
281,419
$
59.55
3.18
$
77
Vested and expected to vest as of March 31, 2025
281,419
$
59.55
3.08
$
77
Exercisable as of March 31, 2025
281,419
$
59.55
3.08
$
77
The intrinsic value is the amount by which the closing price of the Company’s common stock on March 31, 2025 or the price on the day of exercise exceeds the exercise price of the stock options multiplied by the number of in-the-money options.
A summary of the activity in the RSUs and PSUs and related information is as follows
RSU
PSU
Number of
Shares
Outstanding
Weighted average grant date fair value
Number of
Shares
Outstanding
Weighted average grant date fair value
Unvested as of December 31, 2024
3,395,347
$
70.62
334,254
$
67.52
Granted
679,392
15.20
755,343
6.39
Vested
( 261,327
)
125.55
-
-
Forfeited
( 194,150
)
97.17
( 19,822
)
255.45
Unvested as of March 31, 2025
3,619,262
$
54.83
1,069,775
$
20.88
c.
Employee Stock Purchase Plan ("ESPP"):
The Company adopted an ESPP effective upon the consummation of the IPO. As of March 31, 2025, a total of 5,125,666 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 1 st 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.
The ESPP is implemented through an offering every six months. According to the ESPP, eligible employees may use the lesser of either up to 15 % of their salaries or $ 15,000 per participant, to purchase common stock for every six month 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 March 31, 2025, 1,798,312 shares of common stock have been purchased under the ESPP.
As of March 31, 2025, 3,327,354 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.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 21
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
d.
Stock-based compensation expenses:
The Company recognized stock-based compensation expenses related to all stock-based awards in the condensed consolidated statement of loss for the three months ended March 31, 2025, and 2024, as follows:
Three Months Ended
March 31,
2025
2024
Stock-based compensation expenses:
Cost of revenues
$
4,372
$
5,968
Research and development
15,911
17,139
Selling and marketing
4,742
7,911
General and administrative
6,401
6,588
Total stock-based compensation expenses
$
31,426
$
37,606
Stock-based compensation capitalized:
Inventory
$
646
$
804
Other long-term assets
439
478
Total stock-based compensation capitalized
$
1,085
$
1,282
For the three months ended March 31, 2025 no amounts were recorded in regard to tax benefits associated with share-based compensation.
The total tax benefit associated with share-based compensation for the three months ended March 31, 2024 was $ 5,366 .
The tax benefit realized from share-based compensation for three months ended March 31, 2024 was $ 1,341 .
As of March 31, 2025, there were total unrecognized compensation expenses in the amount of $ 197,511 related to non-vested equity-based compensation arrangements granted. These expenses are expected to be recognized during the period from April 1, 2025 through May 31, 2029.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 22
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 14: COMMITMENTS AND CONTINGENT LIABILITIES
a.
Guarantees:
As of March 31, 2025, contingent liabilities exist regarding guarantees in the amounts of $ 102,644 , $ 10,806 and $ 1,540 , for each of securing projects with customers, office rent lease agreements, and other transactions, respectively.
b.
Contractual purchase obligations:
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 March 31, 2025, the Company had non-cancellable purchase obligations totaling approximately $ 234,017 , out of which the Company recorded a provision for loss in the amount of $ 25,811 .
As of March 31, 2025, the Company had contractual obligations for capital expenditures totaling approximately $ 32,432 . These commitments reflect purchases of automated assembly lines and other machinery related to the Company’s general manufacturing process and are primarily for its new manufacturing sites in the U.S.
c.
Legal claims:
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.
On November 3, 2023, Daphne Shen, a purported stockholder of the Company, filed a proposed class action complaint for violation of federal securities laws, individually and putatively on behalf of all others similarly situated, in the U.S. District Court of the Southern District of New York against the Company, the Company’s former CEO and the Company’s former CFO. The complaint alleges violations of Section 10(b) and Rule 10b-5 of the Exchange Act, as well as violations of Section 20(a) of the Exchange Act against the individual defendants. The complaint seeks class certification, damages, interest, attorneys’ fees, and other relief. On December 13, 2023, Javier Cascallar filed a similar proposed class action. On January 2, 2024, six purported lead plaintiffs filed motions in the Shen litigation seeking to consolidate the Cascallar and Shen litigations and appoint lead plaintiffs and lead counsel pursuant to the procedures of the Private Securities Litigation Reform Act of 1995.
On February 7, 2024, the Court consolidated the two actions (the “Consolidated Securities Litigation”), and appointed co-lead plaintiffs (the “Plaintiffs”) and lead counsel. On April 22, 2024, the co-lead Plaintiffs filed an amended complaint adding two additional officers. The amended complaint made substantially similar allegations and claims. Defendants moved to dismiss the amended complaint on July 15, 2024 (the “Motion”), and the motion was fully briefed as of September 17, 2024. On December 4, 2024, the Court issued an order granting in part the Motion, dismissing all allegations except those relating to two purported misstatements, characterizing inventory levels as low. The Court allowed the Plaintiffs to again amend their complaint, and they filed a second amended complaint (the “Second Amended Complaint”) on January 3, 2025. On February 10, 2025, Defendants moved to dismiss the Second Amended Complaint insofar as it attempts to resurrect any of the allegations dismissed in the Court’s December 4 order. On April 7, 2025, a judge issued an order granting in part the Motion, and dismissing all allegations except those characterizing inventory levels as “low” and those relating to demand in Europe. The judge again granted the Plaintiffs the opportunity to file a further amended complaint, which is due on May 7, 2025. Discovery remains stayed pending the Court’s ultimate decision on the motion to dismiss the Second Amended Complaint.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 23
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
On March 15, 2024, Abdul Hirani filed a purported derivative complaint (the “Hirani Complaint”) in the United States District Court for the Southern District of New York against certain current and former SolarEdge executive officers and board members, including Zvi Lando, Ronen Faier, Nadav Zafrir, Betsy Atkins, Marcel Gani, Dana Gross, Dirk Hoke, Avery More, and Tal Payne. The Hirani Complaint makes largely the same allegations as those in the Consolidated Securities Litigation, namely, that the Company failed to disclose information about SolarEdge’s inventory in Europe and cancellation rates from European distributors, which allegedly resulted in material misstatements about the Company’s business and prospects in its quarterly filings. The Hirani Complaint contends that defendants’ role in allowing those alleged misstatements to be made constitutes (i) breach of fiduciary duty, (ii) aiding and abetting breach of fiduciary duty, (iii) unjust enrichment, (iv) waste of corporate assets, and (v) securities fraud under Section 10(b) of the Exchange Act. The complaint seeks compensatory and punitive damages, interest, attorneys’ fees, and other relief.
On June 10, 2024, Jonathan Blaufarb filed a second purported derivative complaint in the United States District Court for the Southern District of New York against the same defendants as those named in the Hirani Complaint as well as Lior Danziger and J.B. Lowe. The Blaufarb complaint makes largely the same allegations as those in the complaint in the Consolidated Securities Litigation and seeks declaratory relief, corporate governance reforms, damages, restitution, attorneys’ fees, and other relief. It also pleads the same counts as those in the Hirani Complaint, as well as additional counts for abuse of control and gross mismanagement. Defendants accepted service of the Hirani and Blaufarb complaints via stipulation that was so-ordered on July 12, 2024, and the two cases were consolidated with the Hirani matter designated as the lead case. On September 9, 2024, the parties agreed to stay the Consolidated Derivative Actions pending a decision on the motion to dismiss in the Consolidated Securities Litigation. The parties have agreed to keep the stay in place pending a decision on the motion to dismiss the plaintiffs’ Second Amended Complaint in the Consolidated Securities Litigation.
On August 7, 2024, Edwin Isaac filed a purported derivative complaint (the “Isaac Complaint”) in the United States District Court for the District of Delaware against the same defendants as those named in the Consolidated Derivative Actions. The Isaac Complaint makes largely the same allegations as those in the Consolidated Securities Litigation. It also pleads the similar counts to those in the Consolidated Securities Litigation, including (i) breach of fiduciary duty, (ii) contribution, (iii) violation of Section 14(a) of the Exchange Act and SEC Rule 14a-9, (iv) unjust enrichment, (v) waste of corporate assets, and (vi) aiding and abetting breach of fiduciary duty. The complaint seeks declaratory relief, damages, interest, unspecified equitable relief, attorneys’ fees, and other relief. The parties are conferring on service of process and a possible stay of proceedings pending resolution of the motion to dismiss in the Consolidated Securities Litigation.
Due to the early stage of these proceedings, we cannot reasonably estimate the potential range of loss, if any, or the likelihood of a potential adverse outcome. The Company disputes the allegations of wrongdoing and intends to vigorously defend against them.
In August 2019, the Company was served with a lawsuit filed in the civil courts of Milan, Italy against the Italian subsidiary of SolarEdge e-Mobility S.r.l (previously SMRE S.p.A) that purchased the shares of SolarEdge e-Mobility in the tender offer that followed the SolarEdge e-Mobility Acquisition by certain former shareholders of SolarEdge e-Mobility who tendered their shares. The lawsuit asked for damages of approximately $ 3,000 , representing the difference between the amount for which they tendered their shares ( 6 Euro per share) and 6.7 Euros per share. On December 6, 2023, the courts of Milan rendered a decision ordering SolarEdge to pay, in favor of each plaintiff, the difference between the price paid ( 6 Euro per share) and 6.44 Euro per share, i.e. 0.44 euros per share for a total payment of approximately $ 1.6 million Euros. The Company has paid the amount due under the judgement and appealed this decision. The first hearing was held on November 27, 2024, and the case was adjourned to January 14, 2026.
On January 13, 2025, Stellantis Europe S.p.A. (“Stellantis”) submitted an application for injunctive relief, to the Court of Turin, Italy, claiming that SolarEdge e-Mobility was allegedly in breach of contract. The application for injunctive relief is aimed at obtaining the following interim measures: i) order the Company to resume supply of spare parts and technical assistance activities in favor of Stellantis; and ii) to order the Company to pay a penalty of 100,000 Euro for each day of delay in fulfilling the order above. At a hearing on February 25, 2025 the parties discussed the case and the judge reserved any decision. We are waiting for the Court decision. The Company disputes the allegations of wrongdoing and intends to vigorously defend against them.
As of March 31, 2025, the Company recorded an accrual of $ 449 for legal claims which was recorded under accrued expenses and other current liabilities.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 24
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 15: ACCUMULATED OTHER COMPREHENSIVE LOSS
The following table summarizes the changes in accumulated balances of other comprehensive gain (loss), net of taxes:
Three Months Ended March 31,
2025
2024
Unrealized gains (losses) on available-for-sale marketable securities
Beginning balance
$
( 385
)
$
( 4,960
)
Revaluation
481
1,860
Tax on revaluation
-
( 369
)
Net current period other comprehensive income
481
1,491
Ending balance
$
96
$
( 3,469
)
Unrealized gains (losses) on cash flow hedges
Beginning balance
$
1,262
$
3,940
Revaluation
( 398
)
( 1,748
)
Tax on revaluation
( 90
)
210
Other comprehensive loss before reclassifications
( 488
)
( 1,538
)
Reclassification
( 748
)
( 939
)
Tax on reclassification
90
112
Gains reclassified from accumulated other comprehensive income (loss)
( 658
)
( 827
)
Net current period other comprehensive loss
( 1,146
)
( 2,365
)
Ending balance
$
116
$
1,575
Foreign currency translation adjustments on intra-entity transactions that are of a long-term investment in nature
Beginning balance
$
( 78,714
)
$
( 43,335
)
Revaluation
( 928
)
( 13,382
)
Ending balance
$
( 79,642
)
$
( 56,717
)
Unrealized gains (losses) on foreign currency translation
Beginning balance
$
1,360
$
( 2,530
)
Revaluation
3,466
( 5,470
)
Ending balance
$
4,826
$
( 8,000
)
Total
$
( 74,604
)
$
( 66,611
)
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 25
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
The following table summarizes the reclassifications from “Accumulated other comprehensive loss” into the statement of loss:
Details about Accumulated Other Comprehensive Loss Components
Three Months Ended
March 31,
Affected Line Item in the Statement of Loss
2025
2024
Cash flow hedges
$
84
$
105
Cost of revenues
457
565
Research and development
74
122
Sales and marketing
133
147
General and administrative
$
748
$
939
Total, before income taxes
( 90
)
( 112
)
Tax benefits (income taxes)
Total reclassifications for the period
$
658
$
827
Total, net of tax benefits (income taxes)
NOTE 16: OTHER OPERATING EXPENSE (INCOME)
The following table presents the expenses (income) recorded in the three months ended March 31, 2025, and 2024:
Three Months Ended
March 31,
2025
2024
Income from settlement agreements associated with contractual commitments
$
( 3,137
)
$
-
Impairment and disposal by abandonment of property, plant and equipment
25
1,732
Other
( 463
)
659
Total other operating expense (income), net
$
( 3,575
)
$
2,391
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 26
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 17: RESTRUCTURING AND OTHER EXIT ACTIVITIES
On January 21, 2024, the Company announced the adoption of a restructuring plan in response to challenging industry conditions (the “Restructuring Plan”). Under the Restructuring Plan, the Company reduced its headcount by approximately 900 employees over the first half of 2024 in an involuntary workforce reduction. The adoption of the Restructuring Plan follows the Company’s previous measures taken to align with current market conditions, including termination of manufacturing in Mexico, reduction of manufacturing capacity in China, and discontinuation of the Company’s light commercial vehicle e-mobility activity. On July 15, 2024, the Company announced additional workforce reductions, resulting in the layoff of 400 employees.
On November 27, 2024, the Company announced the closure of its Energy Storage Division. In connection with the closure, the Company expects to reduce its headcount by approximately 500 employees, primarily in manufacturing positions in South Korea. This closure and associated headcount reduction represented approximately 12% of the Company’s overall employee population, at the time, almost all of whom will be dismissed over the first half of 2025. The Company has determined that the discontinuation of its Energy Storage activity does not 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.
Restructuring and other exit charges for the three months ended March 31, 2025, by type of cost were as follows:
Employee
termination costs
Contract termination and other
Total
Cost of revenues
$
465
$
133
$
598
Research and development
1,093
-
1,093
Sales and marketing
830
-
830
General and administrative
895
-
895
Other operating expenses
-
( 3,137
)
( 3,137
)
Total
$
3,283
$
( 3,004
)
$
279
Restructuring and other exit charges for the three months ended March 31, 2024, by type of cost were as follows:
Employee
termination costs
Contract termination and other
Total
Cost of revenues
$
607
$
4,781
$
5,388
Research and development
2,913
-
2,913
Sales and marketing
641
-
641
General and administrative
342
-
342
Total
$
4,503
$
4,781
$
9,284
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 27
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
The Company’s liability balance for the restructuring and other exit charges is as follows:
Employee termination
costs
Contract termination and other
Balance as of December 31, 2024
$
1,073
$
23,933
Charges
3,283
133
Cash payments
( 3,620
)
-
Non-cash utilization and other
-
( 1,145
)
Balance as of March 31, 2025
$
736
$
22,921
NOTE 18: INCOME TAXES
For the three months ended March 31, 2025, the Company reported income taxes at an effective tax rate of negative 6.2 % including discrete items, compared to the three months ended March 31, 2024, where the Company reported income taxes at an effective tax rate of 13.1 %.
The negative effective tax rate in the three months ended March 31, 2025 resulted primarily from the valuation allowance on current losses, coupled with withholding taxes incurred on certain intra-group interest payments and additional tax payable as a result of the settlement with the Israeli Taxes Authority (as further detailed below). The effective tax rate in the corresponding period in 2024 was mainly due to impairments and disposals, which significantly increased the quarterly loss before income tax, partially offset by higher tax expenses resulting from an increase in the valuation allowance during that quarter.
Deferred tax assets are evaluated for future realization and reduced by a valuation allowance to the extent that the Company believes they will not be realized. The Company considers all available evidence, including historical information, long range forecast of future taxable income and evaluation of tax planning strategies. Amounts recorded for valuation allowance can result from a complex series of judgments about future events and can rely on estimates and assumptions. Based primarily on the negative evidence outweighing the positive evidence, including the Company's three year cumulative, consolidated GAAP loss, historical tax losses and the difficulty in forecasting excess tax benefits related to equity-based compensation, the Company believes there is uncertainty as to when it will be possible to utilize certain net operating losses (each an “NOL”), credit carryforwards and other deferred tax assets. Therefore, the Company recorded a valuation allowance against the deferred tax assets for which it is more-likely-than-not they will not be realized.
Should the Company's operating results improve and projections show continued utilization of the tax attributes, the Company would consider that as significant positive evidence and future reassessment may result in the determination that all or a portion of the valuation allowance is no longer required. If this were to occur, any reversal of the valuation allowance would result in a corresponding non-cash income tax benefit, thereby increasing total DTAs.
During March 2025, SolarEdge Technologies, Ltd. (the “Israeli Subsidiary”) reached a settlement agreement with the Israeli Tax Authority settling all issues in dispute for tax years 2016 - 2018, in consideration for a payment of NIS 100 million (approximately $ 27 million). Accordingly, the Israeli Subsidiary recorded a current tax payable for the settlement amount and released approximately $ 25 million of its provision for uncertain tax positions for these years (including related accruals for interest and penalties). The settlement amount is payable in monthly payments over 3 years and can be prepaid in full at any point. The amount payable bears interest and is linked to the Consumer Prices Index.
The Company accrues interest and penalties related to unrecognized tax benefits in its provision for income taxes. The total amount of penalties and interest as of March 31, 2025 and December 31, 2024 were $ 2,032 and $ 9,165 , respectively.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 28
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 19: LOSS PER SHARE
The following table presents the computation of basic and diluted loss per share (“EPS”):
Three Months Ended March 31,
2025
2024
Basic EPS:
Numerator:
Net loss
$
( 98,523
)
$
( 157,311
)
Denominator:
Shares used in computing net loss per share of common stock, basic
58,121,502
57,140,126
Diluted EPS:
Numerator:
Net loss attributable to common stock, diluted
$
( 98,523
)
$
( 157,311
)
Denominator:
Shares used in computing net loss per share of common stock, diluted
58,121,502
57,140,126
Loss per share:
Basic and Diluted
$
( 1.70
)
$
( 2.75
)
The following outstanding shares of common stock equivalents were excluded from the calculation due to their antidilutive nature:
Three Months Ended March 31,
2025
2024
Stock-based awards
2,191,912
1,810,591
Notes due 2025
1,249,560
2,276,818
Notes due 2029 1
9,819,347
-
Total shares excluded
13,260,819
4,087,409
1 In conjunction with the issuance of the Notes 2029, in June 2024, the Company used approximately $ 25,230 of its net proceeds from this offering to pay the cost of the capped call transactions. In July 2024, following a subsequent issuance of the Notes 2029, $ 3,111 of net proceeds were used to pay the cost of capped call transactions. In accordance with FASB ASC 260, antidilutive contracts, such as purchased call options are excluded from the computation of diluted net income (loss) per share. Accordingly, any potential impact resulting from capped call transaction is excluded from the Company's computation of diluted net income (loss) per share.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 29
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
NOTE 20: SEGMENT INFORMATION
Following the sale of Automation Machines and the discontinuation of the Energy Storage activity in 2024, the Company now operates as one operating segment that constitutes consolidated results. The Company recast its comparative numbers to conform to current period presentation.
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 net loss, accompanied by disaggregated information about significant expenses.
The Company’s CODM does not regularly review asset information and, therefore, the Company does not report asset information.
The 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 batteries for PV applications. The segment solution consists mainly of the Company’s power optimizers, inverters, batteries and cloud‑based monitoring platform.
The following tables present information on reportable loss for the period presented:
Three Months Ended March 31,
2025
2024
Revenues
$
219,480
$
204,399
Less:
Direct costs of goods
130,929
131,906
Salaries 1
122,445
136,789
Inventory costs
1,919
10,608
Shipment and logistics
11,134
10,618
Warranty
( 446
)
16,774
Depreciation and amortization
13,103
14,101
Directly related overhead costs
11,688
13,768
Other 2
31,286
43,540
Financial (income) expense, net
( 10,068
)
7,064
Income taxes (tax benefit)
5,726
( 23,754
)
Net loss from equity method investments
287
296
Net loss
$
( 98,523
)
$
( 157,311
)
1 Including stock-based compensation expenses.
2 Represents indirect costs of goods, consultants and sub-contractors, marketing and bad debt.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 30
SOLAREDGE TECHNOLOGIES INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except per share data)
The following table presents revenues disaggregated by geographical location:
Three Months Ended March 31,
2025
2024
United States
$
132,104
$
65,283
Europe
52,502
95,088
International markets
34,874
44,028
Total revenues
$
219,480
$
204,399
NOTE 21: SUBSEQUENT EVENTS
On April 1, 2025, the Company sold one of its battery cell manufacturing facilities and certain other related assets, in South Korea for $ 10,000 .
On April 30, 2025, the Company divested from its PV tracker business, in order to focus on the Company's core solar business.
SOLAREDGE TECHNOLOGIES INC. | 2025 Form 10-Q | F - 31
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.