Canadian Solar Reports Fourth Quarter and Full Year 2024 Results

, /PRNewswire/ -- Canadian Solar Inc. ("Canadian Solar" or the "Company") (NASDAQ: CSIQ) today announced financial results for the fourth quarter and full year ended December 31, 2024. Fourth Quarter Highlights Highest single quarter of e-STORAGE shipments to date at 2.2 GWh. Expanded e-STORAGE pipeline to record 79 GWh, including $3.2 billion in contracted backlog, as of December 31, 2024. Full Year 2024 Highlights 31.1 GW of solar module shipments by CSI Solar. 6.6 GWh of energy storage shipments by CSI Solar, a year-over-year ("yoy") increase of over 500%. Recurrent Energy brought record 1.3 GWp of solar projects to commercial operation. Dr. Shawn Qu, Chairman and CEO, commented, "2024 was a challenging year for the solar industry, with intense competition and ongoing policy and trade-related uncertainties creating operational and financial headwinds. Despite these industry-wide pressures, our modules business executed targeted strategic adjustments, enabling us to maintain relatively stronger profitability compared to the broader market. The industry and Canadian Solar are undergoing a transition. While near- to mid-term uncertainties persist in the solar market, demand for energy storage is accelerating. Storage is increasingly compelling, both in stand-alone applications and when paired with solar, driven by growing energy demand from sectors such as data centers and electric vehicles. Finally, we remain fully committed to the U.S. market and continue to advance our manufacturing expansion across three facilities dedicated to solar modules, solar cells, and energy storage solutions." Yan Zhuang, President of Canadian Solar's subsidiary CSI Solar, said, "Our team at CSI Solar remained focused while navigating a turbulent 2024. By maintaining a disciplined order-taking strategy, we were able to sustain relatively competitive pricing while continuing to improve cost efficiencies across our vertically integrated supply chain and tightly managing operating expenses. Energy storage was a key profitability driver, as we delivered both quarterly and full year shipment records. While we anticipate margin normalization in this segment, our priority remains scaling volume and further diversifying our global footprint. With our largest-ever pipeline and a robust contracted backlog, we have strong visibility into future growth." Ismael Guerrero, CEO of Canadian Solar's subsidiary Recurrent Energy, said, "We made significant progress in our business model transformation in 2024, starting construction on 1.4 GWp of solar PV and 1.4 GWh of energy storage projects. Of these, 420 MWp of PV reached commercial operation in the U.S. across Texas, Oklahoma, and Louisiana. That said, project sales delays in 2024 impacted our full year performance. As we bring more projects to commercial operation, our recurring income will continue to scale." Xinbo Zhu, Senior VP and CFO, added, "In the fourth quarter, we generated $1.5 billion in revenue with a gross margin of 14.3%. Profitability was impacted by a combination of impairments to Recurrent Energy projects, impairments to certain solar manufacturing assets, anti-dumping/countervailing duties, and tariffs. Net income attributable to shareholders of $34 million and earnings per diluted share of $0.48 were positively impacted by HLBV method of accounting relating to tax equity arrangements of U.S. projects, totaling $132 million or $1.95 per share, respectively. Capital expenditures came in slightly below expectations, totaling $1.1 billion in 2024. We ended the year with $2.3 billion in cash, ensuring we have the financial flexibility to support working capital needs and make strategic investments in the year ahead." Fourth Quarter 2024 Results Total module shipments recognized as revenues in the fourth quarter of 2024 were 8.2 GW, down 2% quarter-over-quarter ("qoq") and up 1% year-over-year ("yoy"). Of the total, 401MW were shipped to the Company's own utility-scale solar power projects. Net revenues in the fourth quarter of 2024 increased 1% qoq and decreased 11% yoy to $1.5 billion. The sequential increase primarily reflects higher third party battery energy storage solutions sales and higher project sales, partially offset by a decline in solar module average selling price ("ASP") and shipment volume. The yoy decrease primarily reflects a decline in solar module ASPs, partially offset by higher battery energy storage solutions sales and higher project sales. Gross profit in the fourth quarter of 2024 was $217 million, down 12% qoq and up 2% yoy. Gross margin in the fourth quarter of 2024 was 14.3%, compared to 16.4% in the third quarter of 2024 and 12.5% in the fourth quarter of 2023. The gross margin sequential decrease was primarily caused by lower module ASPs. The gross margin yoy increases were primarily driven by higher margin contribution from third party battery energy storage solutions sales and project sales. Total operating expenses in the fourth quarter of 2024 were $344 million, compared to $247 million in the third quarter of 2024 and $213 million in the fourth quarter of 2023. The sequential increase was primarily caused by impairment charges related to certain manufacturing and solar assets. The yoy increase was primarily due to the impairment charges and higher shipping and handling expenses. Depreciation and amortization charges in the fourth quarter of 2024 were $135 million, compared to $134 million in the third quarter of 2024 and $89 million in the fourth quarter of 2023. The sequential and yoy increases were primarily driven by the payment of vertical integration investments made by the Company over the past two years and incremental capacity in key strategic markets. Net interest expense in the fourth quarter of 2024 was $9 million, compared to $20 million in the third quarter of 2024 and $18 million in the fourth quarter of 2023. The sequential and yoy decrease were mainly due to higher interest income. Derivative loss from hedging, net of foreign exchange gains, in the fourth quarter of 2024 was $10 million, compared to a net loss of $4 million in the third quarter of 2024 and a net gain of less than $1 million in the fourth quarter of 2023. Net income attributable to Canadian Solar in accordance with generally accepted accounting principles in the United States of America ("GAAP") in the fourth quarter of 2024 was $34 million, or $0.48 per diluted share, compared to a net loss of $14 million, or $0.31 per diluted share, in the third quarter of 2024, and net loss of $1 million, or $0.02 per diluted share, in the fourth quarter of 2023. Adjusted net loss attributable to Canadian Solar Inc. (non-GAAP) was $99 million and adjusted loss per share - diluted was $1.47 a share in the fourth quarter of 2024, compared to $14 million or $0.31 per share in the third quarter of 2024, and $1 million or $0.02 per share in the fourth quarter of 2023. Adjusted net loss attributable to Canadian Solar Inc. and adjusted loss per share - diluted in the fourth quarter of 2024 exclude the recognition of income using hypothetical liquidation at book value ("HLBV") method. The Company uses the HLBV method to attribute income and loss to its tax equity investors. Please see Recurrent Energy Segment - HLBV for definition and About Non-GAAP Financial Measures for reconciliation to nearest GAAP measures. Net cash flow provided by operating activities in the fourth quarter of 2024 was $66 million, compared to net cash flow used in operating activities of $231 million in the third quarter of 2024 and net cash flow provided by operating activities of $190 million in the fourth quarter of 2023. Total debt was $5.2 billion as of December 31, 2024, including $2.4 billion, $2.6 billion, and $0.2 billion related to CSI Solar, Recurrent Energy, and convertible notes, respectively. Total debt decreased as compared to $5.4 billion as of September 30, 2024, mainly due to fluctuation in foreign exchanges on foreign currency denominated debt. Business Segments The Company has two business segments: Recurrent Energy and CSI Solar. The two businesses operate as follows: Recurrent Energy is one of the world's largest clean energy project development platforms with 15 years of experience, having delivered approximately 11.5 GWp of solar power projects and 4.5 GWh of battery energy storage projects. It is vertically integrated and has strong expertise in greenfield origination, development, financing, construction, execution, operations and maintenance, and asset management. CSI Solar consists of solar module and battery energy storage manufacturing, and delivery of total system solutions, including inverters, solar system kits, and EPC (engineering, procurement, and construction) services. CSI Solar's e-STORAGE provides integrated utility-scale battery energy storage solutions, including turnkey and bankable system solutions across various applications, long-term service agreements, and future battery capacity augmentation services. Recurrent Energy Segment As of December 31, 2024, the Company held a leading position with a total global solar development pipeline of 25 GWp and a battery energy storage development pipeline of 75 GWh. The business model consists of three key drivers: Electricity revenue from operating portfolio to drive stable, diversified cash flows in growth markets with stable currencies; Asset sales (solar power and battery energy storage) in the rest of the world to drive cash-efficient growth model, as value from project sales will help fund growth in operating assets in stable currency markets; and Power services (O&M) and asset management through long-term operations and maintenance ("O&M") contracts, currently with approximately 13 GW of contracted projects, to drive stable and long-term recurring earnings and synergies with the project development platform. In October 2024, the Company announced it had achieved the final closing of a $500 million investment in Recurrent Energy by BlackRock through a fund management by BlackRock's Climate Infrastructure business. As agreed between the parties, BlackRock's total investment represents 20% of the outstanding fully diluted shares of Recurrent Energy on an as-converted basis, as determined immediately upon closing. Canadian Solar will continue to own the remaining majority shares of Recurrent Energy. This milestone enables Recurrent Energy to advance investment in its high value project development portfolio, supporting its strategic transition from a pure developer to a developer plus long-term owner and operator in select markets including the U.S. and Europe. This transition will allow Recurrent Energy to generate more stable long-term revenue in low-risk currencies and capture greater value from its diversified global project development pipeline. Project Development Pipeline – Solar As of December 31, 2024, Recurrent Energy's total solar project development pipeline was 24.9 GWp, including 1.9 GWp under construction, 4.2 GWp of backlog, and 18.8 GWp of projects in advanced and early-stage pipelines, defined as follows: Backlog projects are late-stage projects that have passed their risk cliff date and are expected to start construction in the next 1-4 years. A project's risk cliff date is the date on which the project passes the last high-risk development stage and varies depending on the country where it is located. Typically, this occurs after the project has received all the required environmental and regulatory approvals, and entered into interconnection agreements and offtake contracts, including feed-in tariff ("FIT") arrangements and power purchase agreements ("PPAs"). A significant majority of backlog projects are contracted (i.e., have secured a PPA or FIT), and the remaining have a reasonable assurance of securing PPAs. Advanced pipeline projects are mid-stage projects that have secured or have more than 90% certainty of securing an interconnection agreement. Early-stage pipeline projects are early-stage projects controlled by Recurrent Energy that are in the process of securing interconnection. While the magnitude of the Company's project development pipeline is an important indicator of potential expanded power generation and battery energy storage capacity as well as potential future revenue growth, the development of projects in its pipeline is inherently uncertain. If the Company does not successfully complete the pipeline projects in a timely manner, it may not realize the anticipated benefits of the projects to the extent anticipated, which could adversely affect its business, financial condition, or results of operations. In addition, the Company's guidance and estimates for its future operating and financial results assume the completion of certain solar projects and battery energy storage projects that are in its pipeline. If the Company is unable to execute on its actionable pipeline, it may miss its guidance, which could adversely affect the market price of its common shares and its business, financial condition, or results of operations. HLBV The Company applies the HLBV method to account for its contractual partnership with tax equity investors in U.S. solar power and battery energy storage projects. This method allocates income or loss based on changes in each investor's claim on the net assets of the projects. The following table presents Recurrent Energy's total solar project development pipeline. Solar Project Development Pipeline (as of December 31, 2024) – MWp* Region Under Construction Backlog AdvancedPipeline Early-Stage Pipeline Total North America 286 565 637 4,443 5,931 Europe, the Middle East, and Africa("EMEA") 1,005** 1,863 1,309 4,890 9,067 Latin America 128** 860 - 4,628 5,616 Asia Pacific excluding China and Japan 171 2 708 1,282 2,163 China 300 900** - 860 2,060 Japan 59 53 - - 112 Total 1,949 4,243 2,654 16,103 24,949 *All numbers are gross MWp. **Including 74 MWp under construction and 943 MWp in backlog that are owned by or already sold to third parties. Project Development Pipeline – Battery Energy Storage As of December 31, 2024, Recurrent Energy's total battery energy storage project development pipeline was 75.1 GWh, including 9.9 GWh under construction and in backlog, and 65.2 GWh of projects in advanced and early-stage pipelines. The table below sets forth Recurrent Energy's total battery energy storage project development pipeline. Battery Energy Storage Project Development Pipeline (as of December 31, 2024) – MWh Region UnderConstruction Backlog AdvancedPipeline Early-StagePipeline Total North America 1,400 800 760 21,250 24,210 EMEA - 3,522 3,417 28,338 35,277 Latin America - 1,765 - - 1,765 Asia Pacific excluding China and Japan 440 - 980 1,780 3,200 China - 1,199 - 5,000 6,199 Japan 8 719 2,241 1,440 4,408 Total 1,848 8,005 7,398 57,808 75,059 Operating Results The following table presents select unaudited results of operations data of the Recurrent Energy segment for the periods indicated. Recurrent Energy Segment Financial Results (In Thousands of U.S. Dollars, Except Percentages) Three Months Ended Twelve Months Ended December 31, 2024 September 30, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Net revenues 188,455 45,056 53,750 323,469 497,653 Cost of revenues 174,393 30,638 31,995 257,976 292,926 Gross profit 14,062 14,418 21,755 65,493 204,727 Operating expenses 53,601 35,522 22,938 155,573 108,106 Income (loss) from operations* (39,539) (21,104) (1,183) (90,080) 96,621 Gross margin 7.5 % 32.0 % 40.5 % 20.2 % 41.1 % Operating margin -21.0 % -46.8 % -2.2 % -27.8 % 19.4 % *Include effects of both sales to third-party customers and to the Company's CSI Solar segment. Please refer to theattached financial tables for intercompany transaction elimination information. Income (loss) from operations reflectsmanagement's allocation and estimate as some services are shared by the Company's two business segments. CSI Solar Segment Solar Modules and Solar System Kits CSI Solar shipped 8.2 GW of solar modules and solar system kits to more than 70 countries in the fourth quarter of 2024. For the fourth quarter of 2024, the top five markets ranked by shipments were China, the U.S., Spain, Germany and Pakistan. CSI Solar's revised manufacturing capacity expansion targets are set forth below. Solar Manufacturing Capacity, GW* December 2024 Actual December 2025 Plan Ingot 25.0 33.0 Wafer 31.0 37.0 Cell 48.4 36.2 Module 60.2 61.0 *Nameplate annualized capacities at said point in time. Capacity expansion plans are subject to change without noticebased on market conditions and capital allocation plans. e-STORAGE: Battery Energy Storage Solutions As of December 31, 2024, e-STORAGE had a total project turnkey pipeline of over 79 GWh, which includes both contracted and under construction projects, as well as projects at different stages of the negotiation process. In addition, e-STORAGE had over 4.9 GWh of operating battery energy storage projects contracted under long-term service agreements, all of which were battery energy storage projects previously executed by e-STORAGE. As of December 31, 2024, the contracted backlog, including contracted long-term service agreements, was approximately $3.2 billion. These are signed orders with contractual obligations to customers, providing significant earnings visibility over a multi-year period. The table below sets forth e-STORAGE's manufacturing capacity expansion targets. e-STORAGE Manufacturing Capacity Expansion Plans* December 2024 Actual December 2025 Plan SolBank Battery Energy Storage Solutions (GWh) 20.0 30.0 Battery Cells (GWh) 0 3.0 *Nameplate annualized capacities at said point in time. Capacity expansion plans are subject to change without noticebased on market conditions and capital allocation plans. Operating Results The following table presents select unaudited results of operations data of the CSI Solar segment for the periods indicated. CSI Solar Segment Financial Results* (In Thousands of U.S. Dollars, Except Percentages) Three Months Ended Twelve Months Ended December 31, 2024 September30, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Net revenues 1,670,050 1,716,330 1,701,320 6,460,003 7,230,550 Cost of revenues 1,340,011 1,396,246 1,494,723 5,272,722 6,121,332 Gross profit 330,039 320,084 206,597 1,187,281 1,109,218 Operating expenses 279,874 209,257 166,120 850,499 653,135 Income from operations 50,165 110,827 40,477 336,782 456,083 Gross margin 19.8 % 18.6 % 12.1 % 18.4 % 15.3 % Operating margin 3.0 % 6.5 % 2.4 % 5.2 % 6.3 % *Include effects of both sales to third-party customers and to the Company's Recurrent Energy segment. Please refer to theattached financial tables for intercompany transaction elimination information. Income from operations reflects management's allocation and estimate as some services are shared by the Company's two business segments. Business Outlook The Company's business outlook is based on management's current views and estimates given factors such as existing market conditions, order book, production capacity, input material prices, foreign exchange fluctuations, the anticipated timing of project sales, and the global economic environment. This outlook is subject to uncertainty with respect to, among other things, customer demand, project construction and sale schedules, product sales prices and costs, supply chain constraints, and geopolitical conflicts. Management's views and estimates are subject to change without notice. For the first quarter of 2025, the Company expects total revenue to be in the range of $1.0 billion to $1.2 billion. Gross margin is expected to be between 9% and 11%. Total module shipments recognized as revenues by CSI Solar are expected to be in the range of 6.4 GW to 6.7 GW, including approximately 400 MW to the Company's own projects. Total battery energy storage shipments by CSI Solar in the first quarter of 2025 are expected to be around 800 MWh, including about 150 MWh to the Company's own projects. For the full year of 2025, the Company reiterates its prior outlook for CSI Solar's total module shipments to be in the range of 30 GW to 35 GW, including approximately 1 GW to the Company's projects. The Company also reiterates its prior outlook for CSI Solar's total battery energy storage shipments, projected to be in the range of 11 GWh to 13 GWh, including approximately 1 GWh to the Company's own projects. The Company's total revenue is expected to be in the range of $7.3 billion to $8.3 billion. Dr. Shawn Qu, Chairman and CEO, commented, "First quarter margins will be impacted by lower contribution from our storage business due to seasonally smaller shipment volumes, trade-related duties, and tariffs. Additionally, softer margins from Recurrent project asset sales will weigh on segment performance. Amid ongoing consolidation in the solar market, we remain committed to prioritizing profitability over volume. Looking ahead, we are confident that margin contributions from storage shipments will help improve group-level margins, as contracted volumes provide visibility into higher shipment levels by CSI Solar throughout the year." Recent Developments Canadian Solar On January 28, 2025, Canadian Solar announced its Founder, Chairman, and CEO, Dr. Shawn Qu, has been named an Innovator on the prestigious TIME100 Climate 2024 list. This recognition celebrates his outstanding contributions to the renewable energy sector and his leadership in advancing solar and energy storage solutions worldwide. On January 15, 2025, Canadian Solar announced the opening of its new global headquarters in Ontario, Canada. Located in Kitchener, Ontario, the new headquarters embodies Canadian Solar's commitment to innovation, sustainability, and its Canadian heritage. The Kitchener office will serve as the corporate headquarters of the Company as well as several of its subsidiary companies like e-STORAGE and the module sales and services business units. CSI Solar On March 20, 2025, Canadian Solar announced the signing of a Battery Supply Agreement and Long-Term Service Agreement with Strata Clean Energy's White Tank Energy Storage LLC for a 100 MW/576 MWh DC Battery Energy Storage System in Arizona, USA. Construction is set to begin in October of 2026. e-STORAGE will supply, commission, and oversee the long-term operation of the battery system. On March 6, 2025, Canadian Solar announced the signing of Battery Supply Agreements and Long-Term Service Agreements ("LTSA") for two major battery energy storage projects totaling 1.2 GWh in the United States, developed by Aypa Power. Construction of the projects is expected to commence in Q3 2025. Following commissioning, e-STORAGE will oversee system maintenance and operations under a 20-year LTSA, ensuring long-term performance and reliability. On February 10, 2025, Canadian Solar announced the signing of a contract with Copenhagen Infrastructure Partners ("CIP") through its fifth flagship fund Copenhagen Infrastructure V to deliver 240 MW/960 MWh of battery energy storage systems in Summerfield, South Australia. The Summerfield project, expected to start construction in 2025, will be one of South Australia's largest battery energy storage projects. On January 8, 2025, Canadian Solar announced the signing of contracts with CIP, through its flagship fund CI IV. The contracts cover the delivery of 2 GWh DC of battery energy storage systems for two landmark projects in Scotland. Each site will have a two-hour energy storage dispatch capability, and both are scheduled to start construction in 2027. On December 12, 2024, Canadian Solar announced the execution of three significant agreements with Sunraycer Renewables LLC, an Annapolis, Maryland-based renewable energy platform. These include battery energy storage supply and commissioning agreements for two projects totaling 315 MWh in Texas, as well as the purchase of up to 2 GWp of high-efficiency solar modules for various Sunraycer projects. Recurrent Energy On March 18, 2025, Canadian Solar announced the closing of project financing and tax equity for Recurrent Energy's Fort Duncan Storage Project. The 200 MWh storage project, located in Texas, is currently under construction and is expected to be commercially operational by summer 2025. Nord/LB led the project financing, which includes a construction and term loan, a tax equity bridge loan, and a letter of credit facility totaling $112 million. Recurrent Energy also executed a $71 million tax equity partnership with Greenprint Capital. On December 10, 2024, Canadian Solar announced the signing of a 10-year power purchase agreement with a major U.S.-based technology company. Under the agreement, the counterparty will procure renewable energy from a 300 MWp solar power project in Spain. The project is being developed by Recurrent Energy and expected to be operational by 2026. Recurrent Energy plans to own and operate the solar project. Conference Call Information The Company will hold a conference call on Tuesday, March 25, 2025, at 8:00 a.m. U.S. Eastern Time (8:00 p.m., Tuesday, March 25, 2025, in Hong Kong) to discuss the Company's fourth quarter and full year 2024 results and business outlook. The dial-in phone number for the live audio call is +1-877-704-4453 (toll-free from the U.S.), 800 965 561 (from Hong Kong), +86 400 120 2840 (local dial-in from Mainland China) or +1-201-389-0920 from international locations. The conference ID is 13752023. A live webcast of the conference call will also be available on the investor relations section of Canadian Solar's website at www.canadiansolar.com. A replay of the call will be available after the conclusion of the call until 11:00 p.m. U.S. Eastern Time on Tuesday, April 8, 2025 (11:00 a.m. April 9, 2025, in Hong Kong) and can be accessed by dialing +1-844-512-2921 (toll-free from the U.S.) or +1-412-317-6671 from international locations. The replay pin number is 13752023. A webcast replay will also be available on the investor relations section of Canadian Solar's at www.canadiansolar.com. About Canadian Solar Inc. Canadian Solar is one of the world's largest solar technology and renewable energy companies. Founded in 2001 and headquartered in Kitchener, Ontario, the Company is a leading manufacturer of solar photovoltaic modules; provider of solar energy and battery energy storage solutions; and developer, owner, and operator of utility-scale solar power and battery energy storage projects. Over the past 24 years, Canadian Solar has successfully delivered nearly 150 GW of premium-quality, solar photovoltaic modules to customers across the world. Through its subsidiary e-STORAGE, Canadian Solar has shipped over 10 GWh of battery energy storage solutions to global markets as of December 31, 2024, boasting a US$3.2 billion contracted backlog as of December 31, 2024. Since entering the project development business in 2010, Canadian Solar has developed, built, and connected approximately 11.5 GWp of solar power projects and 4.5 GWh of battery energy storage projects globally. Its geographically diversified project development pipeline includes 25 GWp of solar and 75 GWh of battery energy storage capacity in various stages of development. Canadian Solar is one of the most bankable companies in the solar and renewable energy industry, having been publicly listed on the NASDAQ since 2006. For additional information about the Company, follow Canadian Solar on LinkedIn or visit www.canadiansolar.com. Safe Harbor/Forward-Looking Statements Certain statements in this press release, including those regarding the Company's expected future shipment volumes, revenues, gross margins, and project sales are forward-looking statements that involve a number of risks and uncertainties that could cause actual results to differ materially. These statements are made under the "Safe Harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by such terms as "believes," "expects," "anticipates," "intends," "estimates," the negative of these terms, or other comparable terminology. Factors that could cause actual results to differ include general business, regulatory and economic conditions and the state of the solar power and battery energy storage market and industry; geopolitical tensions and conflicts, including impasses, sanctions and export controls; volatility, uncertainty, delays and disruptions related to global pandemics; supply chain disruptions; governmental support for the deployment of solar power and battery energy storage; future available supplies of silicon, solar wafers and lithium cells; demand for end-use products by consumers and inventory levels of such products in the supply chain; changes in demand from significant customers; changes in demand from major markets such as China, the U.S., Europe, Brazil and Japan; changes in effective tax rates; changes in customer order patterns; changes in product mix; changes in corporate responsibility, especially environmental, social and governance ("ESG") requirements; capacity utilization; level of competition; pricing pressure and declines in or failure to timely adjust average selling prices; delays in new product introduction; delays in utility-scale project approval process; delays in utility-scale project construction; delays in the completion of project sales; the pipeline of projects and timelines related to them; the ability of the parties to optimize value of that pipeline; continued success in technological innovations and delivery of products with the features that customers demand; shortage in supply of materials or capacity requirements; availability of financing; exchange and inflation rate fluctuations; litigation and other risks as described in the Company's filings with the Securities and Exchange Commission, including its annual report on Form 20-F filed on April 26, 2024. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, level of activity, performance, or achievements. Investors should not place undue reliance on these forward-looking statements. All information provided in this press release is as of today's date, unless otherwise stated, and Canadian Solar undertakes no duty to update such information, except as required under applicable law. Investor Relations Contact: FINANCIAL TABLES FOLLOW The following tables provide unaudited select financial data for the Company's CSI Solar and Recurrent Energy businesses. Select Financial Data – CSI Solar and Recurrent Energy Three Months Ended and As of December 31, 2024 (In Thousands of U.S. Dollars, Except Percentages) CSI Solar Recurrent Energy Elimination and unallocated items (1) Total Net revenues $ 1,670,050 $ 188,455 $ (337,264) $ 1,521,241 Cost of revenues 1,340,011 174,393 (210,199) 1,304,205 Gross profit 330,039 14,062 (127,065) 217,036 Gross margin 19.8 % 7.5 % — 14.3 % Income (loss) from operations (2) $ 50,165 $ (39,539) $ (137,723) $ (127,097) Supplementary Information: Interest expense (3) $ (16,062) $ (17,518) $ (1,815) $ (35,395) Interest income (3) 9,101 17,158 42 26,301 Cash and cash equivalents $ 1,288,075 $ 385,167 $ 28,245 $ 1,701,487 Restricted cash – current and noncurrent 550,664 11,870 — 562,534 Non-recourse borrowings — 997,434 — 997,434 Other short-term and long- term borrowings 2,264,767 1,342,648 — 3,607,415 Green bonds and convertible notes – current and noncurrent — 146,542 228,917 375,459 Select Financial Data – CSI Solar and Recurrent Energy Twelve Months Ended December 31, 2024 (In Thousands of U.S. Dollars, Except Percentages) CSI Solar Recurrent Energy Elimination and unallocated items (1) Total Net revenues $ 6,460,003 $ 323,469 $ (790,063) $ 5,993,409 Cost of revenues 5,272,722 257,976 (536,608) 4,994,090 Gross profit 1,187,281 65,493 (253,455) 999,319 Gross margin 18.4 % 20.2 % — 16.7 % Income (loss) from operations (2) $ 336,782 $ (90,080) $ (276,783) $ (30,081) Supplementary Information: Interest expense (3) $ (63,698) $ (63,465) $ (10,305) $ (137,468) Interest income (3) 63,107 25,281 82 88,470 Select Financial Data – CSI Solar and Recurrent Energy Three Months Ended December 31, 2023 (In Thousands of U.S. Dollars, Except Percentages) CSI Solar Recurrent Energy Elimination and unallocated items (1) Total Net revenues $ 1,701,320 $ 53,750 $ (53,033) $ 1,702,037 Cost of revenues 1,494,723 31,995 (38,085) 1,488,633 Gross profit 206,597 21,755 (14,948) 213,404 Gross margin 12.1 % 40.5 % — 12.5 % Income (loss) from operations (2) $ 40,477 $ (1,183) $ (38,717) $ 577 Supplementary Information: Interest expense (3) $ (15,853) $ (15,590) $ (1,804) $ (33,247) Interest income (3) 14,160 1,468 4 15,632 Select Financial Data – CSI Solar and Recurrent Energy Twelve Months Ended December 31, 2023 (In Thousands of U.S. Dollars, Except Percentages) CSI Solar Recurrent Energy Eliminationand unallocated items (1) Total Net revenues $ 7,230,550 $ 497,653 $ (114,577) $ 7,613,626 Cost of revenues 6,121,332 292,926 (80,615) 6,333,643 Gross profit 1,109,218 204,727 (33,962) 1,279,983 Gross margin 15.3 % 41.1 % — 16.8 % Income from operations (2) $456,083 $96,621 $(99,384) $453,320 Supplementary Information: Interest expense (3) $ (60,413) $ (46,489) $ (7,197) $ (114,099) Interest income (3) 43,788 7,797 36 51,621 (1) Includes inter-segment elimination, and unallocated corporate items not considered part of management's evaluation of business segment operating performance. (2) Income (loss) from operations reflects management's allocation and estimate as some services are shared by the Company's two business segments. (3) Represents interest expenses payable to and interest income earned from third parties. Select Financial Data - CSI Solar and Recurrent Energy Three Months Ended December 31, 2024 Three MonthsEnded September 30, 2024 Three MonthsEnded December 31, 2023 (In Thousands of U.S. Dollars) CSI Solar Revenues: Solar modules $ 944,055 $ 1,217,157 $ 1,243,066 Solar system kits 77,619 106,438 144,492 Battery energy storage solutions 241,942 95,384 195,899 EPC and others 74,607 43,589 64,830 Subtotal 1,338,223 1,462,568 1,648,287 Recurrent Energy Revenues: Solar power and battery energy storage asset sales 137,890 — 21,449 Electricity revenue from operating portfolio and others 23,234 24,358 16,391 Power services (O&M) and asset management 21,894 20,698 15,910 Subtotal 183,018 45,056 53,750 Total net revenues $ 1,521,241 $ 1,507,624 $ 1,702,037 Select Financial Data - CSI Solar and Recurrent Energy Twelve Months Ended December 31, 2024 Twelve Months Ended December 31, 2023 (In Thousands of U.S. Dollars) CSI Solar Revenues: Solar modules $ 4,281,178 $ 5,941,345 Solar system kits 398,173 679,350 Battery energy storage solutions 814,604 245,173 EPC and others 181,422 250,105 Subtotal 5,675,377 7,115,973 Recurrent Energy Revenues: Solar power and battery energy storage asset sales 156,686 399,098 Electricity revenue from operating portfolioand others 78,444 46,176 Power services (O&M) and assetmanagement 82,902 52,379 Subtotal 318,032 497,653 Total net revenues $ 5,993,409 $ 7,613,626 Canadian Solar Inc. Unaudited Condensed Consolidated Statements of Operations (In Thousands of U.S. Dollars, Except Share and Per Share Data) Three Months Ended Twelve Months Ended December 31, September 30, December 31, December 31, December 31, 2024 2024 2023 2024 2023 Net revenues $ 1,521,241 $ 1,507,624 $ 1,702,037 $ 5,993,409 $ 7,613,626 Cost of revenues 1,304,205 1,260,188 1,488,633 4,994,090 6,333,643 Gross profit 217,036 247,436 213,404 999,319 1,279,983 Operating expenses: Selling and distribution expenses 131,671 136,172 93,847 487,947 369,670 General and administrative expenses 219,611 99,989 108,236 515,204 440,488 Research and development expenses 30,476 30,459 31,503 120,792 100,844 Other operating income, net (37,625) (19,478) (20,759) (94,543) (84,339) Total operating expenses 344,133 247,142 212,827 1,029,400 826,663 Income (loss) from operations (127,097) 294 577 (30,081) 453,320 Other income (expenses): Interest expense (35,395) (34,184) (33,247) (137,468) (114,099) Interest income 26,301 13,745 15,632 88,470 51,621 Gain (loss) on change in fair value of derivatives,net (49,719) 14,932 (7,039) (51,400) (27,504) Foreign exchange gain (loss), net 40,013 (18,662) 7,058 46,750 30,555 Investment income (loss), net (1,334) 3,427 1,965 1,427 14,632 Total other expenses (20,134) (20,742) (15,631) (52,221) (44,795) Income (loss) beforeincome taxes and equity in earnings of affiliates (147,231) (20,448) (15,054) (82,302) 408,525 Income tax (expense) benefit 11,707 19,829 4,650 16,576 (59,501) Equity in earnings (losses) of affiliates 85 (5,451) 7,204 (12,136) 14,610 Net income (loss) (135,439) (6,070) (3,200) (77,862) 363,634 Less: Net (income) loss attributable to non-controlling interests and redeemable non-controlling interests (169,342) 7,956 (1,814) (113,913) 89,447 Net income (loss) attributable to CanadianSolar Inc. $ 33,903 $ (14,026) $ (1,386) $ 36,051 $ 274,187 Earnings (loss) per share - basic $ 0.51 $ (0.31) $ (0.02) $ 0.54 $ 4.19 Shares used in computation - basic 66,947,055 66,933,121 66,035,331 66,616,400 65,375,084 Earnings (loss) per share - diluted $ 0.48 $ (0.31) $ (0.02) $ 0.54 $ 3.87 Shares used in computation - diluted 73,363,174 66,933,121 66,035,331 66,939,428 72,194,006 Canadian Solar Inc. Unaudited Condensed Consolidated Statement of Comprehensive Income (Loss) (In Thousands of U.S. Dollars) Three Months Ended Twelve Months Ended December 31, September30, December 31, December 31, December31, 2024 2024 2023 2024 2023 Net income (loss) $ (135,439) $ (6,070) $ (3,200) $ (77,862) $ 363,634 Other comprehensive income (loss): Foreign currency translationadjustment (129,573) 130,342 82,692 (112,941) 8,141 Gain (loss) on changes in fair value of available-for-sale debt securities, net of tax 679 (105) (2,897) 2,223 (3,487) Gain (loss) on interest rateswap, net of tax 6,821 (8,874) (2,821) (1,569) (1,124) Share of gain (loss) on changes in fair value of derivatives of affiliate, net of tax 1,626 (1,908) 3,074 693 11,264 Comprehensive income (loss) (255,886) 113,385 76,848 (189,456) 378,428 Less: comprehensive (income)loss attributable to non-controlling interests and redeemable non-controlling interests (194,803) 12,969 17,324 (145,860) 90,829 Comprehensive income (loss) attributable to Canadian Solar Inc. $ (61,083) $ 100,416 $ 59,524 $ (43,596) $ 287,599 Canadian Solar Inc. Unaudited Condensed Consolidated Balance Sheets (In Thousands of U.S. Dollars) December 31, December 31, 2024 2023 ASSETS Current assets: Cash and cash equivalents $ 1,701,487 $ 1,938,689 Restricted cash 551,387 999,933 Accounts receivable trade, net 1,118,770 904,943 Accounts receivable, unbilled 142,603 101,435 Amounts due from related parties 5,220 40,582 Inventories 1,206,595 1,179,641 Value added tax recoverable 221,539 162,737 Advances to suppliers, net 124,440 193,818 Derivative assets 14,025 9,282 Project assets 394,376 280,793 Prepaid expenses and other current assets 436,635 283,600 Total current assets 5,917,077 6,095,453 Restricted cash 11,147 7,810 Property, plant and equipment, net 3,174,643 3,088,442 Solar power and battery energy storagesystems, net 1,976,939 951,513 Deferred tax assets, net 473,500 263,458 Advances to suppliers, net 118,124 132,218 Investments in affiliates 232,980 236,928 Intangible assets, net 31,026 19,727 Project assets 889,886 576,793 Right-of-use assets 378,548 237,007 Amounts due from related parties 75,215 32,313 Other non-current assets 232,465 254,098 TOTAL ASSETS $ 13,511,550 $ 11,895,760 Canadian Solar Inc. Unaudited Condensed Consolidated Balance Sheets (Continued) (In Thousands of U.S. Dollars) December 31, December 31, 2024 2023 LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS AND EQUITY Current liabilities: Short-term borrowings $ 2,119,724 $ 1,805,198 Convertible notes 228,917 — Accounts payable 1,062,874 813,677 Short-term notes payable 637,512 878,285 Amounts due to related parties 3,927 511 Other payables 984,023 1,359,679 Advances from customers 204,826 392,308 Derivative liabilities 13,738 6,702 Operating lease liabilities 21,327 20,204 Other current liabilities 388,460 587,827 Total current liabilities 5,665,328 5,864,391 Long-term borrowings 2,485,125 1,265,965 Green bonds and convertible notes 146,542 389,033 Liability for uncertain tax positions 5,770 5,701 Deferred tax liabilities 204,832 82,828 Operating lease liabilities 271,849 116,846 Other non-current liabilities 582,301 465,752 TOTAL LIABILITIES 9,361,747 8,190,516 Redeemable non-controlling interests $ 247,834 $ — Equity: Common shares 835,543 835,543 Additional paid-in capital 590,578 292,737 Retained earnings 1,585,758 1,549,707 Accumulated other comprehensive loss (196,379) (118,744) Total Canadian Solar Inc. shareholders' equity 2,815,500 2,559,243 Non-controlling interests 1,086,469 1,146,001 TOTAL EQUITY 3,901,969 3,705,244 TOTAL LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS AND EQUITY $ 13,511,550 $ 11,895,760 Canadian Solar Inc. Unaudited Condensed Statements of Cash Flows (In Thousands of U.S. Dollars) Three Months Ended Twelve Months Ended December 31, September 30, December 31, December 31, December 31, 2024 2024 2023 2024 2023 Operating Activities: Net income (loss) $ (135,439) $ (6,070) $ (3,200) $ (77,862) $ 363,634 Adjustments to reconcile net income (loss) to net cashprovided by (used in) operating activities 454,591 57,395 171,051 844,537 510,718 Changes in operating assets and liabilities (252,686) (282,290) 22,146 (1,651,999) (189,737) Net cash provided by (used in) operating activities 66,466 (230,965) 189,997 (885,324) 684,615 Investing Activities: Purchase of property, plantand equipment (212,098) (237,365) (295,086) (1,106,173) (1,116,461) Purchase of solar power and battery energy storage systems (326,081) (247,219) (183,277) (757,577) (408,999) Other investing activities (95,730) (12,124) (17,011) (98,507) (145,956) Net cash used in investingactivities (633,909) (496,708) (495,374) (1,962,257) (1,671,416) Financing Activities: Net proceeds from sale of subsidiary's redeemable preferred shares (14,756) 200,000 — 482,244 — Payments for repurchase of subsidiary's ordinary shares (1,894) (7,064) — (79,582) — Net proceeds from subsidiary's public offering of ordinary shares — — — — 927,897 Contributions from redeemable non-controlling interests 196,058 30,877 — 226,935 — Other financing activities (41,940) 1,047,480 222,216 1,690,174 1,124,931 Net cash provided by financingactivities 137,468 1,271,293 222,216 2,319,771 2,052,828 Effect of exchange rate changes (133,798) 91,933 36,561 (154,601) (89,098) Net increase (decrease) in cash, cash equivalents and restricted cash (563,773) 635,553 (46,600) (682,411) 976,929 Cash, cash equivalents and restricted cash at the beginningof the period $ 2,827,794 $ 2,192,241 $ 2,993,032 $ 2,946,432 $ 1,969,503 Cash, cash equivalents and restricted cash at the end of theperiod $ 2,264,021 $ 2,827,794 $ 2,946,432 $ 2,264,021 $ 2,946,432 About Non-GAAP Financial MeasuresThis press release also contains adjusted net income (loss) attributable to Canadian Solar Inc. and adjusted earnings (loss) per share - diluted that are not determined in accordance with GAAP. These non-GAAP financial measures should not be considered as an alternative to net income (loss) attributable to Canadian Solar Inc. or earnings (loss) per share, respectively, each of which is an indicator of financial performance determined in accordance with GAAP. Adjusted net income (loss) attributable to Canadian Solar Inc. and adjusted earnings (loss) per share - diluted exclude from net income (loss) attributable to Canadian Solar Inc. and earnings (loss) per share certain items that the Company does not consider indicative of its ongoing financial performance such as the effects of HLBV method to account for its tax equity arrangements. Management uses these non-GAAP financial measures to facilitate the analysis and communication of the Company's financial performance as compared to its previous financial results. Management believes that these non-GAAP financial measures are also useful and meaningful to investors to facilitate their analysis of the Company's financial performance. These non-GAAP measures may differ from non-GAAP measures used by other companies, and therefore their comparability may be limited. The table below provides a reconciliation of our GAAP net income to non-GAAP financial measures. Three Months Ended Twelve Months Ended December 31, September 30, December 31, December 31, December 31, 2024 2024 2023 2024 2023 GAAP net income (loss) attributable to Canadian Solar Inc. $ 33,903 $ (14,026) $ (1,386) $ 36,051 $ 274,187 Non-GAAP income adjustment items: Less: HLBV effects (164,285) — — (164,285) — Add: HLBV effects attributable to redeemable non-controlling interests 31,809 — — 31,809 — Non-GAAP adjusted net income (loss) attributable to Canadian Solar Inc. $ (98,573) $ (14,026) $ (1,386) $ (96,425) $ 274,187 GAAP earnings (loss) pershare – diluted $ 0.48 $ (0.31) $ (0.02) $ 0.54 $ 3.87 Non-GAAP incomeadjustment items: Less: HLBV effects (2.43) — — (2.46) — Add: HLBV effectsattributable to redeemable non-controlling interests 0.48 — — 0.47 — Non-GAAP adjusted earnings(loss) per share – diluted $ (1.47) $ (0.31) $ (0.02) $ (1.45) $ 3.87 Shares used in computation – diluted (GAAP) 73,363,174 66,933,121 66,035,331 66,939,428 72,194,006 Shares used in computation – diluted (Non-GAAP) 66,947,055 66,933,121 66,035,331 66,616,400 72,194,006 SOURCE Canadian Solar Inc. 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Canadian Solar Reports Fourth Quarter and Full Year 2024 Results

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