Array Technologies' Q1 2025: Key Contradictions in Safe Harbor Orders, Backlog Dynamics, and Margin Expectations

Safe harbor orders and order book dynamics, backlog conversion and revenue visibility, gross margin guidance and expectations, and impact of legacy VCAs on financial performance are the key contradictions discussed in Array Technologies' latest 2025Q1 earnings call.



Revenue and Volume Growth:
- Array Technologies reported $302 million in revenue for Q1 2025, representing a 97% year-over-year increase and a 10% sequential increase from Q4 2024.
- The growth was driven by robust demand and accelerated volume growth of 143% over the prior year.

Order Book and Delivery Schedule:
- The company maintained a $2 billion order book despite near-term policy-related headwinds, with over 40% of the order book expected to be delivered in the remaining quarters of 2025.
- Despite some customers facing challenges in pricing PPAs and understanding forward project costs, the order book remains resilient due to the company's customer-centric approach and innovative product offerings.

Margin Impact and Strategic Adjustments:
- Adjusted gross margin was 26.5% for Q1 2025, impacted by legacies such as a large volume commitment project and international lower margin projects.
- Array is actively managing market uncertainties through strategic supply chain initiatives and product innovation to mitigate margin pressures, such as the introduction of the SkyLink platform.

Product and Market Strategy:
- The company's new product offerings, including OmniTrack and SkyLink, represented 15% of Q1 revenue and 30% of new bookings.
- These products are gaining traction due to their innovative features that simplify installation and enhance overall performance, contributing to Array's market momentum.