LOS ANGELES (Reuters) - SunPower Corp (SPWR.O) on Wednesday reported a higher-than-expected profit, raised its 2013 earnings outlook and announced investment in a new factory, a move it said signaled the global solar market has turned around.
Wall Street initially cheered the results, sending SunPower shares up in after-market trading. The stock later reversed course to trade down 3 percent when the company's chief executive gave a 2014 earnings per share forecast that fell short of expectations due to expenses for the new plant and a higher share count.
After several years of enduring a global oversupply of solar panels, rapidly falling product prices and elusive profits, SunPower is once again making money and expanding production.
The company, which is majority owned by French energy giant Total SA (TOTF.PA), is building several major solar power plants in California. It is benefitting from strong residential demand in the United States and gaining business in the fast-growing Japanese market. The once-stalled European market is improving.
"We see a very positive market across all geographies," Chief Executive Tom Werner said in an interview.
SunPower plans to build a 350 megawatt solar cell factory in the Philippines that will come online in 2015. In the meantime, it will run its factories at full capacity next year.
"It gives you some sense of our belief in the future," Werner said. "We are very optimistic about the next few years."
SunPower raised its 2013 earnings outlook to a range of $1.30 per share to $1.50 per share, well above its prior outlook of $1 to $1.30 per share.
The revenue view was tightened to a range of $2.52 billion to $2.57 billion from a previous range of $2.5 billion to $2.6 billion.
On a conference call with analysts, Werner said earnings per share for 2014 would be about $1, below the $1.23 per share analysts are expecting, according to Thomson Reuters I/B/E/S.
He said the company's results would "increase meaningfully" in 2015 thanks in part to the new production capacity.
"The stock isn't going to be dead money throughout 2014," said Baird analyst Ben Kallo, who has an "outperform" rating on SunPower shares. "There is a lot of good business coming in... You will have some short term focused investors selling on some of those comments. Longer term investors will remain committed."
SunPower's solar panels are the most efficient in the industry at converting sunlight into electricity, allowing the company to command a price premium for them in the market. The efficiency of the company's panels has served SunPower well in Japan, where solar system prices are high and customers favor highly efficient panels.
Net income for the third quarter was $108.4 million, or 73 cents per share, compared with a net loss of $48.5 million, or 41 cents per share, a year ago.
Excluding items, the company earned 44 cents per share. On that basis, analysts had been expecting earnings of 25 cents a share, according to Thomson Reuters I/B/E/S.
Revenue rose 14 percent to $657.1 million. Analysts expected revenue of $589.4 million.
SunPower's stock is up 466 percent so far this year.
Reporting by Nichola Groom and Ernest Scheyder; Editing by Leslie Adler, Ken Wills and Andrew Hay