Sunnova Reports Q2 2024 Financial Results, 161 MW of Solar Power Added

Sunnova, an adaptive energy services company, has reported progress in its financial results for the second quarter of 2024. The company added 161 megawatts of solar power generation and 284 megawatt-hours of energy storage under management during this period, increasing its total cumulative solar power generation under management to 2.8 gigawatts and energy storage under management to 1,439 megawatt-hours as of June 30, 2024.

“Last quarter, we set four key priorities, all with the acute focus on increasing our cash generation and maintaining strong margins,” said William J. (John) Berger, Sunnova's founder and CEO. “I am pleased to report that we made considerable progress against those priorities in the second quarter, building on our momentum from the first quarter, and yielding an increase in unrestricted cash on our balance sheet for the second quarter in a row. We have every intention of maintaining this positive trend line for the remainder of 2024 and beyond, evidenced by the increase in our cash generation guidance.”

Sunnova's revenue for the three months ended June 30, 2024, increased to USD 219.6 million, a rise of USD 53.2 million compared to the same period in 2023. This growth was primarily driven by a USD 55.9 million increase in revenue from core adaptive energy customers, including PPA, lease, SREC, loan, and cash sales revenue. This was partially offset by a USD 5.4 million decrease in direct sales revenue.

Total operating expenses, net, for the three months ended June 30, 2024, increased to USD 278.5 million, a rise of USD 52.4 million compared to the same period in 2023. This increase was mainly due to higher losses on sales of customer notes receivable, a greater number of solar energy systems in service, and increased general and administrative expenses. These costs were somewhat mitigated by changes in the fair value of certain financial instruments and contingent considerations, along with lower operations and maintenance expenses.

Adjusted operating expenses rose to USD 108.8 million, an increase of USD 21.9 million year-over-year, primarily due to the increased number of solar energy systems in service and higher general and administrative expenses.

Despite these rising costs, Sunnova reduced its net loss to USD 79.7 million for the second quarter of 2024, compared to a net loss of USD 100.8 million in the same period in 2023. This improvement was attributed to investment tax credit sales, which resulted in an income tax benefit, increased interest income from a larger customer loan portfolio, and lower operations and maintenance expenses. 

Sunnova's adjusted EBITDA showed remarkable growth, reaching USD 216.7 million for the second quarter of 2024, up from USD 28.1 million in the same period of 2023. This increase was largely driven by investment tax credit sales and higher adjusted EBITDA from lease and PPA customers.

Principal proceeds from customer notes receivable and investments in solar receivables totaled USD 55.4 million for the second quarter of 2024, compared to USD 39.6 million in the same period of 2023. Interest income also increased, reaching USD 35.4 million, up from USD 26.3 million in the previous year, both driven by a larger customer loan portfolio.

Looking ahead, Sunnova expects full-year 2024 customer additions to be between 110,000 and 120,000. The company also projects adjusted EBITDA for the year to range between USD 650 million and USD 750 million, anticipating a greater contribution from investment tax credit sales and increased lease and PPA revenues alongside lower operating expenses.

Interest income and principal proceeds from customer notes receivable, net of amounts recorded in revenue, and investments in solar receivables are expected to be between USD 115 million and USD 125 million and USD 180 million and USD 190 million, respectively. This forecast is influenced by the recent sale of non-solar loans and a faster-than-expected shift to leases and PPAs.