The U.S. economy may be sputtering, but there was some good news coming out of the cleantech world this morning. First Solar, the poster child of cleantech IPOs and the so-called “Google of solar,” reported a sharp rise in its profit and revenue for the latest quarter. The company also said it now expects that its revenue could top $1 billion for the full-year period.
First Solar reported net earnings of $46.6 million, or 57 cents a share, for the three-month period ended March 29, a more than nine-fold increase from its profit of $5.03 million, or 7 cents a share, in the same period a year earlier. Revenue jumped to $196.9 million from $66.9 million in the first quarter of 2007. On a conference call this morning, First Solar CFO Jens Meyerhoff said the company now expects full-year revenue to come in between $975 million and $1.05 billion, up from a prior forecast of between $900 million and $950 million.
Shares of First Solar surged as much as 8 percent to change hands for $307.80, just shy of its 52-week high. This is the same First Solar that we thought might be “crashing back to earth” at the start of the year and was chosen by Jim Gillies on Motley Fool as the “Worst Stock for 2008.” So what’s the deal? Is the solar industry really worth this much or is this a boom-bust cycle, as our own Stacey Higginbotham has posited? Or are First Solar’s financials a testament to a slowly maturing industry that is still growing according to Moore’s Law?
Backing up these increasingly optimistic outlooks, the thin-film solar company said that is expects to produce between 420 and 460 megawatts of capacity this year, up from previous estimates of between 400 and 430 megawatts.
Not much has changed since the solar slump we saw at the start of the year. The Investment Tax Credit, which is critical to all solar projects in the U.S., isn’t any closer to getting extended. The polysilicon shortage is still awaiting new supply centers to come online. And Asian solar manufacturers are roaring ahead with profit margins much wider than their U.S. counterparts.
None of this, however, has disabused VCs of their lucrative infatuation with solar startups. We’ve seen over $100 million in venture capital invested in amorphous silicon startups alone this quarter. Meanwhile, oil prices near $120 a barrel are making all forms of alternative energy more cost-competitive. And so long as oil prices hang out well above the $100-a-barrel mark, it’s likely the solar bubble will stay inflated.