Decline in unit selling price + increase in costs such as tariffs, Canadian Solar's revenue and net profit both declined in Q1

On the evening of April 28, Canadian Solar released its 2024 Annual Report and 2025 Q1 Report.

In Q1 2025, Canadian Solar achieved operating revenue of 8.586 billion yuan, down 10.54% YoY. Net profit attributable to shareholders of the publicly listed firm was 47.2582 million yuan, down 91.83% YoY. This was primarily due to a decline in the company's average selling price during the reporting period, leading to a decrease in operating revenue compared to the same period last year. Additionally, increased costs for tariffs and freight resulted in a lower gross profit margin. However, a decrease in the comprehensive manufacturing cost of products partially offset these impacts.

In 2024, Canadian Solar achieved operating revenue of 46.165 billion yuan, down 10.03% YoY. Net profit attributable to shareholders of the parent company was 2.247 billion yuan, down 22.60% YoY. The significant decline in the selling price of the company's PV modules was the main drag. However, the revenue from the energy storage system (ESS) business achieved rapid growth, becoming a new profit growth point for the company.

In Q4 2024, Canadian Solar achieved operating revenue of 11.987 billion yuan, net profit attributable to shareholders of the parent company of 292 million yuan, and net profit excluding non-recurring gains and losses of 342 million yuan.

According to the annual report, the net cash flow generated from Canadian Solar's operating activities was 2.43 billion yuan, a decrease of 70.49% compared to the same period last year. This was mainly due to a decrease in the selling price of PV modules, leading to a reduction in cash inflow from sales of the main business.

The net cash flow generated from Canadian Solar's investing activities was -9.989 billion yuan, and the net cash flow generated from financing activities was 3.538 billion yuan, down 50.82% YoY. This was primarily due to an increase in cash payments for dividend distributions and share repurchases during the reporting period.

In 2024, PV module products and ESS products were the two businesses with the highest revenue contributions for Canadian Solar. Among them, PV module products achieved revenue of 31.483 billion yuan, down 25.62% YoY, with a gross profit margin of 12.75%, a decrease of 2.95 percentage points compared to the previous year, mainly due to the decline in the selling price of PV modules and systems.

During the same period, its ESS products achieved revenue of 9.738 billion yuan, up 420.76% YoY, with a gross profit margin of 30.84%, an increase of 13.74 percentage points compared to the previous year. The rapid growth of the ESS business partially offset the impact of the decline in the PV module business.

From the perspective of product structure changes, Canadian Solar is gradually shifting towards the ESS sector, with a significant increase in the proportion of the ESS business.

In terms of shipments, in 2024, Canadian Solar sold a total of 31.1 GW of PV modules in the global market. As its second main business, the ESS business achieved shipments of 6.5 GWh, up over 500% YoY.It is expected that by 2025, the shipment scale of its large-scale ESS business will further increase to 11-13 GWh, maintaining a rapid growth trend.

By region, in 2024, Canadian Solar's revenue from overseas markets was 35.811 billion yuan, accounting for 77.59% of total revenue, up 1.54% YoY, with a gross profit margin of 19.55%, an increase of 2.14 percentage points compared to the previous year. Its revenue from the domestic market was 9.604 billion yuan, down 36.60% YoY, with a gross profit margin of -1.80%, a decrease of 9.02 percentage points compared to the previous year.The company's revenue from overseas markets has grown steadily, with an improvement in gross profit margin, while revenue from the domestic market has declined significantly, having a substantial impact on its overall revenue structure.

During the reporting period, Canadian Solar's R&D investment was 857 million yuan, up 21.67% YoY, accounting for 1.86% of operating revenue, an increase of 0.49 percentage points compared to the previous year. This was mainly due to increased R&D investment in technologies such as N-type batteries.

Canadian Solar has achieved breakthroughs in TOPCon battery technology, HJT battery technology, etc., holding a cumulative total of 456 invention patents, 3,017 utility model patents, and 270 design patents, with 84 new invention patents added during the reporting period. Relevant technologies have been applied to high-efficiency PV modules and ESS products.

Currently, the global PV industry is in a period of profound adjustment, with sustained but slowing growth in market demand and prominent overcapacity issues across various links of the industry chain. Despite this, as an important component of the new power system, the value of ESS has expanded from traditional peak shaving and valley filling to areas such as power grid frequency regulation and capacity reserve, demonstrating a relatively broad development prospect.

According to its annual report, as of the end of the reporting period, the top ten circulating shareholders of Canadian Solar held a combined 39.37% stake. New shareholders include Industrial and Commercial Bank of China Limited - E Fund CSI 50 ETF (holding 62.5747 million shares) and Industrial and Commercial Bank of China Limited - Huatai-PineBridge CSI 300 ETF (holding 24.201 million shares). Shareholders that exited include Yangzhou Honglian Ruisi Investment Partnership (Limited Partnership) (originally holding 73.1498 million shares) and CICC Capital Operation Co., Ltd. - Xiamen CICC Yingrun Equity Investment Fund Partnership (Limited Partnership) (originally holding 54.5693 million shares).

Regarding fundraising and investment projects, Canadian Solar's "10 GW Ingot Pulling Project per Year", "Funing 10 GW Wafer Project", "4 GW High-Efficiency Solar PV Cell Project per Year", and "10 GW High-Efficiency PV Cell Module Project per Year" have all been completed and closed as planned, with a total cumulative investment of raised funds of 6.161 billion yuan, accounting for 92.95% of the planned total investment. Additionally, its "Jiaxing Canadian Solar PV Technology Co., Ltd. Research Institute Construction Project" has also been completed, with a cumulative investment of 150 million yuan, accounting for 100% of the planned total investment.

In terms of important matters, Trinasolar has initiated multiple patent lawsuits against Canadian Solar, involving litigation in US federal courts and the 337 investigation process. Currently, the cases have not yet entered the trial stage. Meanwhile, Canadian CSIQ has filed a lawsuit against Clayton Insurance Company regarding warranty insurance claims. The first-stage ruling supported Canadian CSIQ's claims, and the second stage is expected to commence in February 2026. These lawsuits may have a certain impact on the company's short-term operations, but the company has stated that it will actively respond to the lawsuits and take legal measures to safeguard its rights and interests.