Earnings Summary: Canadian Solar misses Q2 profit estimates, Q3 revenue outlook disappoints

Analysis:

Canadian Solar Inc. (CSIQ) reported a wider-than-expected quarterly loss and issued a disappointing revenue outlook for the third quarter, sending its shares down more than 10% in premarket trading on Wednesday.

The company's net loss widened to $88.5 million, or 54 cents per share, in the second quarter ended June 30, from a loss of $20.4 million, or 13 cents per share, a year earlier.

Revenue rose 14.1% to $1.69 billion, but missed analysts' average estimate of $1.78 billion, according to Refinitiv IBES data.

Outlook and Analyst Commentary:

For the third quarter, Canadian Solar forecast revenue of $1.40 billion to $1.50 billion, below analysts' estimates of $1.60 billion. It expects to ship 5.5 gigawatts (GW) to 6.0 GW of solar modules, compared with the 4.7 GW it shipped in the second quarter.

Analysts at Raymond James downgraded Canadian Solar to "underperform" from "outperform," saying the company's Q3 revenue guidance was "disappointing" and that its margins were "under pressure."

Analysts at Credit Suisse maintained their "neutral" rating on the stock, noting that the company's Q2 results were "mixed" and that its Q3 guidance was "below consensus."

Shares of Canadian Solar were down 10.5% at $31.00 in premarket trading on Wednesday.