Enphase Energy Inc.
04/06/2026 | Press release | Distributed by Public on 04/06/2026 14:02
Business/Financial Results (Form 8-K)
Item 2.02. Results of Operations and Financial Condition
The information related to the expectations of Enphase Energy, Inc. (the "Company") of its GAAP gross margin for the first quarter of 2026 as compared to its prior guidance, as set forth under Item 8.01 of this Current Report on Form 8-K, is incorporated herein by reference.
The information in this Item 2.02 of the Form 8-K shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or subject to the liabilities of that Section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended (the "Securities Act"), and shall not be incorporated by reference in any registration statement or other document filed under the Securities Act or the Exchange Act, whether made before or after the date hereof, regardless of any general incorporation language in such filings, except as shall be expressly set forth by specific reference in such a filing.
Item 8.01 Other Events
On March 31, 2026 (the "Effective Date"), the Company entered into a Tax Credit Transfer Agreement (the "Agreement") with a leading financial institution (the "Purchaser").
Pursuant to the Agreement, the Company agreed to sell to the Purchaser $235,000,000 of advanced manufacturing production tax credits ("Tax Credits") generated by the production of certain eligible components in the United States and the sale of such components to third parties during calendar year 2025 (the "Eligible Transaction") pursuant to Section 45X of the Internal Revenue Code of 1986, as amended. Pursuant to the Agreement, the purchase price for such Tax Credits was $218,550,000, payable in a single installment on the Effective Date. The Effective Date was subject to customary conditions precedent, including absence of default and the accuracy of representations and warranties of the Company. The Agreement contains customary covenants, indemnification, and termination provisions for comparable tax credits sale agreements.
The Tax Credits were sold at 93% of face value, resulting in a discount of approximately $16.5 million. The Company also incurred approximately $2.5 million in transaction-related fees. Because these amounts relate to Tax Credits generated in the prior fiscal year and do not reflect the Company's ongoing operating performance, the Company expects to exclude them from its non-GAAP financial measures for the first quarter of 2026. By including these amounts in its GAAP financial measures, the Company expects its GAAP gross margin for the first quarter of 2026 to be reduced by approximately 6.7 percentage points compared to the Company's prior guidance.
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