German solar inverter firm SMA Solar Technology AG has reported stark financial results for the first half of 2025,posting a net loss of€42.4 million(around 354 million yuan),a 196.15%plunge from the€44.1 million net profit recorded in the same period of 2024.Total revenue fell by 9.8%year-on-year to 684.9 million euros(around 797.5 million US dollars),as core operations contracted sharply amid mounting market pressures.
The company's two main business segments experienced significant declines.Residential sales plummeted from 109.9 million euros in the first half of 2024 to 54 million euros(approximately 63 million US dollars),while commercial and industrial sales shrank from 113.6 million euros to 62.1 million euros(around 72.3 million US dollars).Compared to H1 2023,combined sales in these areas dropped by over 70%,highlighting persistent weakness in the German domestic market.
During the earnings call,CEO Jürgen Reinert highlighted three critical pressures:slowing growth in Germany,intense price competition from Asian suppliers and distributor inventory backlogs.These challenges caused the company’s EBITDA margin to fall from 10.6%in H1 2024 to just 1.3%,with total EBITDA dropping by 68%year-on-year to 55.1 million euros(approximately 64.2 million US dollars).
Although SMA’s large-scale project solutions division achieved a 12%year-on-year increase in revenue,reaching 568.8 million euros,it continues to be hindered by uncertainties in global trade policy.Reinert noted that vague safe harbour provisions under the US Inflation Reduction Act(IRA)have delayed several North American projects.Despite holding order backlogs totalling 1.2939 billion euros(around 10.55 billion yuan)as of 31 March 2024,policy risks continue to loom.
In response to the crisis,SMA is accelerating its restructuring plan,which was launched in September 2024.This involves cutting 1,100 jobs globally,two-thirds of which will be in Germany.This is expected to incur restructuring costs of 140 million euros.The company is also abandoning its decade-old'three pillars'business model and shifting to a'dual-core'structure,focusing on residential and commercial solutions,as well as large-scale projects.This will target 150 to 200 million euros in operating cost reductions.
Management remains optimistic about large-scale projects and plans to increase R&D spending to 8%of revenue,focusing on energy storage inverters and smart grid solutions.Its new Sunny Central Storage system has already secured orders totalling 1.2 GW in North America,with unit power costs 18%lower than those of its predecessor.
SMA's struggles highlight the challenging conditions in the sector,but the company is relying on strategic changes and technological investment to overcome the difficulties.
