Is Longi Green Energy's Narrowing Loss a Green Light for Investors?

The solar sector is in a slump, but Longi Green Energy (ticker: LONGI) is fighting back. Despite reporting a net loss of $1.13 billion USD for the first half of 2025—a steep drop from its 2023 peak—the company's narrowing deficit and strategic moves are sparking debate about its long-term viability. Let's dig into the numbers and see if this PV giant is worth a second look.

The Numbers: Losses, but a Silver Lining

Longi's H1 2025 loss marks its third consecutive year of declining profitability, with pretax earnings plummeting from $1.75 billion in 2023 to -$1.3 billion in 2024, then to -$1.13 billion in 2025 (TTM). While this paints a dire picture, the narrowing deficit hints at stabilization. Margins are under pressure due to industry oversupply, which has slashed polysilicon and module prices. But here's the key: Longi's cost discipline is starting to show.

Operational Shifts: Asia-Pacific Surge and Module Sales

The company's focus on high-growth markets like Asia-Pacific is critical. In 2024, its module shipments in the region surged by 140% year-on-year, reaching 31.34 GW. While H1 2025 Asia-Pacific revenue specifics remain undisclosed, this trend suggests Longi is capitalizing on rising demand in India, Southeast Asia, and Australia. Meanwhile, its Q1 2025 module shipments of 16.93 GW—down 15% YoY—reflect broader industry softness, but its BC cell and HPBC 2.0 technology advancements are positioning it to dominate in high-efficiency products.

Strategic Positioning: Betting on Scale and Tech

Longi's 2025 roadmap is all about scale and innovation. By year-end, it aims to hit 70 GW of BC cell capacity (including 50 GW from HPBC 2.0) and 150 GW of monocrystalline module capacity. This isn't just about volume; it's about locking in cost leadership and cornering premium markets. High-efficiency cells, which deliver more power per square meter, are critical as utilities seek to maximize output in constrained spaces.

The Elephant in the Room: Oversupply and Margin Pressures

The PV sector is drowning in overcapacity. polysilicon prices have collapsed by over 70% since 2022, squeezing margins across the board. Longi isn't immune—it reported a 40% revenue drop in 2024 H1—and its Q1 2025 revenue fell to $2.05 billion from $2.65 billion a year earlier. The question is: Can its tech bets and geographic focus offset these headwinds?

Why This Might Be a Buy

1. Market Share Gains: In a downturn, weaker competitors fold. Longi's scale and R&D investments (e.g., HPBC 2.0) let it undercut rivals on cost while offering superior products.
2. Asia-Pacific Dominance: The region's solar boom—driven by India's 500 GW target and Southeast Asia's energy transition—is Longi's growth engine. Its 2024 Asia-Pacific sales surge isn't a fluke; it's a strategic bet paying off.
3. Valuation: At current prices, Longi trades at a deep discount to its 2022 highs. If demand rebounds in 2026 (as many analysts expect), this could be a steal.

The Risks

• Inventory Glut: Global polysilicon and module stockpiles could keep prices depressed longer than expected.
• Trade Wars: U.S.-China tensions and local content laws in markets like the EU could disrupt supply chains.

Verdict: Buy the Dip, but Stay Vigilant

Longi's narrowing loss and strategic bets on tech and Asia-Pacific growth make it a compelling contrarian play. While near-term pain is inevitable, the company's scale, innovation, and focus on high-margin products position it to thrive when the cycle turns. Buy now if you have a 2-3 year horizon, but monitor polysilicon prices and inventory levels closely. This is a stock for investors willing to bet on Longi's ability to outlast the downturn and dominate the recovery.

Stay tuned—the solar sector's survival of the fittest is just getting started.