Enphase Energy announced on Friday that it will reduce its global workforce by approximately 17%, impacting around 500 employees and contractors, as part of efforts to streamline operations in response to slowing residential solar demand.
The company, facing challenges in the European residential solar market, will consolidate contract manufacturing in four existing locations – two in the US, one in India, and one in China. Operations in Guadalajara, Mexico, will be discontinued.
With Enphase’s shares dropping nearly 50% this year due to factors such as lower electricity prices and increased competition, the company expects to incur restructuring and asset impairment charges of $17 million to $20 million, with most of it in the fourth quarter of 2024. Cash expenditures are estimated at $11 million to $12 million.
This decision follows previous job cuts announced in December last year, where the company reduced its workforce by approximately 10%. CEO Badri Kothandaraman cited challenges in the solar market, including reduced US residential solar demand and changes in Europe, as contributing factors.
Enphase anticipates an increase in adjusted operating expenses in the fourth quarter due to the restructuring plan. The company aims to lower adjusted operating expenses to $75 million to $80 million per quarter in 2025 and expects to complete the restructuring by the end of the first quarter of 2025.
