Shares of First Solar plunged on Thursday after the company said it would restructure its operations, but some believe the solar panel and systems maker could emerge more fit to fend off low-cost competitors.
First Solar on Wednesday announced it would phase out its current model solar panels, expedite the development of its Series 6 and abandon an intermediate model. Executives said the more efficient Series 6, which will go into production in 2018, would help the company compete in a market that has seen solar panel prices plunge.
The move will also force First Solar to take $500 million to $700 million in impairments and lay off more than a quarter of its workforce. The company also said it now expects to turn in a $2 to $4 per share loss for 2016 and gave disappointing sale guidance for 2017.
First Solar not only designs and manufactures solar panels, but also creates systems to help them run and provides operation and maintenance to power plants.
The company focuses on selling its panels to utility-scale systems rather than to individual homeowners and businesses. Prices for these large photovoltaic systems that came online in 2015 fell 12 percent per watt from the year prior, according to the Department of Energy's Lawrence Berkeley National Laboratory.