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Summary:

SunPower announced a profit-making second quarter on Wednesday as well as a plan to introduce a solar home loan that will complement its effort in the residential leasing market.

SunPower home installation
photo: Courtesy of Solarcity

SunPower executives said Wednesday they plan to roll out a loan program for the residential market, a move that will enable the company to attract homeowners who want to own rather than lease solar panels.

The plan would complement the Silicon Valley company’s effort to expand its residential leasing program, in which its network of U.S. installers market long-term leases that are financed by money that SunPower secured from investors such as the U.S. Bancorp. The leasing model, which doesn’t require a hefty upfront spending for equipment and labor, has been the engine that drives the boom in the residential market in recent years.

But solar gear ownership hasn’t exactly gone out of style, and doing so allows homeowners — not those who finance the leases — reap the local and federal tax benefits. Some companies are banking that an increasing number of homeowners will choose that option. The optimism comes partly from the falling prices of solar panels in the last three years because of an overproduction of them worldwide. Some financial institutions, such as Admirals Bank, are rolling out home solar loans.

SunPower & Flextronics Factory in Milpitas, CA

SunPower & Flextronics Factory in Milpitas, CA

Meanwhile, an insurance company, Assurant, is offering warranty management plans so that homeowners wouldn’t have to deal with haggling with manufacturers of solar panels, inverters, racking systems and other parts over repairs or replacement. Such solar warranty management plans are a new phenomenon, so how popular it will be remains to be seen.

SunPower’s CFO, Chuck Boynton, mentioned the loan program during conference call with analysts to discuss the company’s second-quarter earnings on Wednesday, though he didn’t provide any more detail about the program. The company has teamed up with banks to market home loan programs before.

The residential solar business is growing for SunPower, which has signed up over 18,400 customers through its lease program, which was launched in 2011. That total count stood at around 16,200 at the end of the first quarter this year. The company has talked about launching a similar leasing program in France and other countries. SunPower also holds 10 percent of Japan’s residential market by selling solar panels through Toshiba and Sharp.

SunPower still generates more sales from developing and building large projects for power plant owners such as MidAmerican and NRG. SunPower is on track to complete the 250MW California Valley Solar Ranch project by the end of 2013 and is also building the 579MW Solar Star, which is formerly called the Antelope Valley Solar Project. It also inked a deal to sell 25MW of solar panels for a power plant project in Japan during the second quarter.

SunPowerFactory6The company did well financially during the second quarter. It generated profits after posting losses for many quarters. SunPower recorded $19.6 million in net income, or $0.15 per share, for the second quarter, compared with a net loss of $84.2 million, or $0.71 per share, from the year-ago period. SunPower also generated $576.5 million in revenue for the second quarter, down $595.9 million from the same quarter in 2012.

The company has been in major cost-cutting mode, and has closed some factory lines over the past two years to deal with the imbalance of supply and demand in the global market. In May, SunPower executives said they had beaten their cost-cutting goals. During the second quarter, the company’s factories were again running at their max production rate.

Although SunPower doesn’t plan to build new factories in the short term, it is looking at ways to increase its production over the next 18 months, said CEO Tom Werner. Werner declined to say what the company plans were for growing production, except that it will involve “sustainable solutions.” But he promised to discuss this issue in the next earnings call.

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  1. Now they need to get rid of those expensive leases entirely. Too bad Sunpower’s pricing for the same amount of power rating is so much more expensive than the other brands.

    1. Its more expensive then the other brands because you are getting the top of the line product. Ron probably drives a Honda, and supports the Japanese. Sunpower is American made and is insured by Americans Who are not going anywhere, not to mention its the only solar panel company that is being traded daily. These Chinese solar panel companies, come into America with cheap panels and it doesn’t cost them anything to produce them because they pay their employees .05 cents an hour. These Chinese solar companies are in it for a quick buck. When they go out of business like they do left and right, the poor Americans like yourself Ron get pissed off because your Chinese panels are not insured anymore. By the way i don’t not work for Sunpower or am not affiliated in anyway with them.
      Have a great day. It is great to be American

      1. Proud American is just another misinformed consumer. Yes, some Sunpower solar modules are made in the U.S. but do a little research before you open your mouth and you’ll find that Sunpower modules have also been made in Asia – Malaysia and the Phillipines. And don’t forget that “Total” (a French company) owns a majority stake in Sunpower. You also have a great day. I will, because It’s even better to be an “informed” American.

  2. Sure It’s great to be an American but to be lied too by the companies partners is so disheartening. I was told that the panels were totally made here in the USA, come to find
    out you can’t even get them to answer a phone here, as you are transferred to the Philippines. The girl with the name J told me that all the manufacturing of the raw material were from there and that they were put together here in Milpitas Ca? After being told some many different things you would think that a American company would want your phone calls during the day to be answered here in the U.S. not so with SunPower, as you will call corporate and where do you end up?? Just call and you will find out it’s not the U.S.A. I chose them to work with on 3 presentation of there partner I was told that they panel were totally mad here in the U.S. I felt jobs for our people and food on the table for there families, boy was I not told the truth. If you have any answers to this I would like to know the real truth about the company and the product. Thanks

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