# Enphase Energy, Inc. (ENPH)

Informational only - not investment advice.

CIK: 0001463101
SIC: 3674 Semiconductors & Related Devices
SIC breadcrumb: [Manufacturing](/division/D/) > [Electronic And Other Electrical Equipment And Components, Except Computer Equipment](/major-group/36/) > [SIC 3674 Semiconductors & Related Devices](/industry/3674/)
Latest 10-K filed: 2026-02-17
SEC page: https://www.sec.gov/edgar/browse/?CIK=1463101
Filing source: https://www.sec.gov/Archives/edgar/data/1463101/000146310126000013/enph-20251231.htm

## At a glance

FY2025 · period end 2025-12-31 · filed 2026-02-17 · accession 0001463101-26-000013 · source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001463101.json

| Metric | Value | FY | Provenance |
| --- | ---: | ---: | --- |
| Revenue | 1,472,985,000 USD | 2025 | verified |
| Net income | 172,133,000 USD | 2025 | verified |
| Assets | 3,509,792,000 USD | 2025 | verified |
| Free cash flow | 95,901,000 USD | 2025 | computed |
| Net margin | 11.69% | 2025 | computed |
| Operating margin | 10.69% | 2025 | computed |
| Revenue YoY | +10.72% | 2025 | computed |
| ROE | 15.84% | 2025 | computed |

Computed values are grepcent-computed from the verified facts above and may differ from ratios the company itself reports. Free cash flow = operating cash flow − capital expenditures. Net margin = net income ÷ revenue. Operating margin = operating income ÷ revenue. Revenue YoY = FY2025 revenue ÷ FY2024 revenue − 1 (consecutive fiscal years only). ROE = net income ÷ period-end stockholders' equity.

No market price, no rating, no forecast on this site. Not investment advice.

### Peer percentile fingerprint

| Ratio | ENPH | Peer median | Percentile | N |
| --- | ---: | ---: | ---: | ---: |
| Net margin | 11.7% | 4.9% | 66 | 59 |
| Operating margin | 10.7% | 3.7% | 61 | 58 |
| Revenue growth | 10.7% | 15.5% | 40 | 61 |
| FCF margin | 6.5% | 8.9% | 39 | 60 |
| ROE | 15.8% | 3.8% | 74 | 58 |
| ROA | 4.9% | 1.6% | 63 | 61 |
| Liabilities / equity | 2.23 | 0.51 | 93 | 59 |
| Current ratio | 2.07 | 2.70 | 22 | 61 |

Percentile = share of the N covered peers reporting that ratio whose value is lower (ties counted half); computed among grepcent-covered companies in SIC industry 3674 Semiconductors & Related Devices, not the whole market. A higher percentile means a higher value of the ratio, not a better company. Ratios with fewer than 8 reporting peers are omitted. Latest reported values per company; fiscal periods may differ. Descriptive arithmetic - not a score, rating, or ranking.

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 1472985000 | USD | 2025 | 2026-02-17 |
| Net income | 172133000 | USD | 2025 | 2026-02-17 |
| Assets | 3509792000 | USD | 2025 | 2026-02-17 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-17. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001463101.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue |  | 286,166,000 | 316,159,000 | 624,333,000 | 774,425,000 | 1,382,049,000 | 2,330,853,000 | 2,290,786,000 | 1,330,383,000 | 1,472,985,000 |
| Net income | -67,462,000 | -45,192,000 | -11,627,000 | 161,148,000 | 133,995,000 | 145,449,000 | 397,362,000 | 438,936,000 | 102,658,000 | 172,133,000 |
| Operating income |  | -39,378,000 | 1,596,000 | 102,729,000 | 186,439,000 | 215,832,000 | 448,261,000 | 445,741,000 | 77,292,000 | 157,526,000 |
| Gross profit | 58,008,000 | 56,043,000 | 94,445,000 | 221,245,000 | 345,981,000 | 554,422,000 | 974,595,000 | 1,058,388,000 | 629,138,000 | 687,004,000 |
| Diluted EPS |  |  |  |  |  |  | 2.77 | 3.08 | 0.75 | 1.29 |
| Operating cash flow | -32,953,000 | -28,442,000 | 16,132,000 | 139,067,000 | 216,334,000 | 352,028,000 | 744,817,000 | 696,780,000 | 513,693,000 | 136,540,000 |
| Capital expenditures | 12,167,000 | 4,121,000 | 4,151,000 | 14,788,000 | 20,558,000 | 52,258,000 | 46,443,000 | 110,401,000 | 33,604,000 | 40,639,000 |
| Share buybacks |  |  |  | 0.00 | 0.00 | 500,000,000 | 0.00 | 409,998,000 | 391,364,000 | 129,957,000 |
| Assets | 163,576,000 | 169,147,000 | 339,937,000 | 713,223,000 | 1,200,102,000 | 2,079,256,000 | 3,084,280,000 | 3,383,012,000 | 3,249,676,000 | 3,509,792,000 |
| Liabilities | 162,276,000 | 178,273,000 | 332,161,000 | 441,011,000 | 716,109,000 | 1,649,088,000 | 2,258,707,000 | 2,399,388,000 | 2,416,660,000 | 2,422,769,000 |
| Stockholders' equity | 1,300,000 | -9,126,000 | 7,776,000 | 272,212,000 | 483,993,000 | 430,168,000 | 825,573,000 | 983,624,000 | 833,016,000 | 1,087,023,000 |
| Cash and cash equivalents | 17,764,000 | 29,144,000 | 106,237,000 | 251,409,000 | 679,379,000 | 119,316,000 | 473,244,000 | 288,748,000 | 369,110,000 | 474,318,000 |
| Free cash flow | -45,120,000 | -32,563,000 | 11,981,000 | 124,279,000 | 195,776,000 | 299,770,000 | 698,374,000 | 586,379,000 | 480,089,000 | 95,901,000 |

### Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Net margin |  | -15.79% | -3.68% | 25.81% | 17.30% | 10.52% | 17.05% | 19.16% | 7.72% | 11.69% |
| Operating margin |  | -13.76% | 0.50% | 16.45% | 24.07% | 15.62% | 19.23% | 19.46% | 5.81% | 10.69% |
| Return on equity |  |  | -149.52% | 59.20% | 27.69% | 33.81% | 48.13% | 44.62% | 12.32% | 15.84% |
| Return on assets | -41.24% | -26.72% | -3.42% | 22.59% | 11.17% | 7.00% | 12.88% | 12.97% | 3.16% | 4.90% |
| Liabilities / equity |  |  | 42.72 | 1.62 | 1.48 | 3.83 | 2.74 | 2.44 | 2.90 | 2.23 |
| Current ratio | 1.42 | 1.42 | 1.51 | 2.51 | 1.75 | 3.33 | 3.55 | 4.59 | 3.53 | 2.07 |

## As-reported value updates

No tracked differences above grepcent's stated thresholds and capped precision rule were found between the earliest XBRL-filed value and the value currently on file for the standardized annual metrics grepcent tracks.


## Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-04-28. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001463101.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

| Quarter | End date | Revenue | Net income | Diluted EPS | Method |
| --- | --- | ---: | ---: | ---: | --- |
| 2015-Q3 | 2015-09-30 |  |  | 0.01 | reported discrete quarter |
| 2016-Q3 | 2016-09-30 |  |  | -0.40 | reported discrete quarter |
| 2023-Q2 | 2023-06-30 | 711,118,000 | 157,191,000 |  | reported discrete quarter |
| 2023-Q3 | 2023-09-30 | 551,082,000 | 113,953,000 |  | reported discrete quarter |
| 2023-Q4 | 2023-12-31 | 302,570,000 | 20,919,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q1 | 2024-03-31 | 263,339,000 | -16,097,000 | -0.12 | reported discrete quarter |
| 2024-Q2 | 2024-06-30 | 303,458,000 | 10,833,000 | 0.08 | reported discrete quarter |
| 2024-Q3 | 2024-09-30 | 380,873,000 | 45,762,000 | 0.33 | reported discrete quarter |
| 2024-Q4 | 2024-12-31 | 382,713,000 | 62,160,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2025-Q1 | 2025-03-31 | 356,084,000 | 29,730,000 | 0.22 | reported discrete quarter |
| 2025-Q2 | 2025-06-30 | 363,153,000 | 37,052,000 | 0.28 | reported discrete quarter |
| 2025-Q3 | 2025-09-30 | 410,427,000 | 66,638,000 | 0.50 | reported discrete quarter |
| 2025-Q4 | 2025-12-31 | 343,321,000 | 38,713,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2026-Q1 | 2026-03-31 | 282,900,000 | -7,406,000 | -0.06 | reported discrete quarter |

## Filed narrative (10-K & 10-Q)

## Business

Verbatim Item 1 Business section from ENPH's latest 10-K: [/company/ENPH/business/](/company/ENPH/business/).

## Risk Factors

Verbatim Item 1A Risk Factors from ENPH's latest 10-K: [/company/ENPH/risk-factors/](/company/ENPH/risk-factors/).

## Latest quarter (10-Q)

Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1463101/000146310126000081/enph-20260630.htm

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary. Published MD&A gate trimmed front/tail over-capture.
Confidence: high
Filing date: 2026-07-28
Report date: 2026-06-30

Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

The following discussion and analysis of our financial condition and results of operations should be read together with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q. This discussion contains forward-looking statements reflecting our current expectations and involves risks and uncertainties. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “intend,” “potential,” “aim” or “continue” or the negative of these terms or other comparable terminology. Such statements, include but are not limited to statements regarding: our expectations as to future financial performance, including revenue, cost of revenue, expenses, liquidity, cash requirements, and our ability to maintain and grow our profitability; the capabilities, performance and competitive advantage of our technology and products and planned changes; the timing of new product releases, and the anticipated market adoption of our current and future products; expectations regarding the development of our 1.25 megawatt (“MW”) IQ® Solid-State Transformer (“IQ SST”) product for data centers; our expectations regarding, and our ability to meet, demand for our products; our business strategies, including anticipated trends and operating conditions; growth of and development in markets in which we target, and our expansion into new and existing markets; our performance in operations, including our supply chain management and manufacturing operations and timelines; our product quality and customer service; our expectations regarding qualification of our products for domestic content credit under U.S. tax laws and our ability to meet Foreign Entity of Concern (“FEOC”) requirements for our U.S. products; our expectations regarding macroeconomic events and geopolitical developments, including the effects of tariffs, which may impact our business operations, financial performance and the markets in which we, our suppliers, manufacturers and installers operate; our expectations regarding potential growth through engagement in the third-party ownership (“TPO”) market; expectations regarding the increased variability in the timing of revenue recognition and cash flows related to safe harbor agreements; expectations regarding the commercial microinverter market opportunity in the United States; market risks associated with financial instruments and foreign currency exchange rates; and the importance of government incentives for solar products, including the impact of recent changes in the tax laws, rules and regulations. You should be aware that the forward-looking statements contained in this report are based on our current views and assumptions, and are subject to known and unknown risks, uncertainties and other factors that may cause actual events or results to differ materially. For a discussion identifying some of the important factors that could cause actual results to vary materially from those anticipated in the forward-looking statements, see below, those discussed in the section entitled “Risk Factors” herein and those included in our Annual Report on Form 10-K for the year ended December 31, 2025 filed on February 17, 2026 (the “Form 10-K”). Unless the context requires otherwise, references in this report to “Enphase,” “we,” “us” and “our” refer to Enphase Energy, Inc. and its consolidated subsidiaries.

Business Overview

We are a global energy technology company. We deliver smart, easy-to-use solutions that manage solar generation, storage and communication on one platform. Our intelligent microinverters work with virtually every solar panel made, and when paired with our smart technology, result in one of the industry’s best-performing clean energy systems. As of June 30, 2026, we have shipped approximately 89.4 million microinverters, and more than 5.3 million Enphase residential and commercial systems have been deployed in over 165 countries.

The Enphase® Energy System brings a high technology, networked approach to solar generation plus energy storage, by leveraging our design expertise across power electronics, semiconductors and cloud-based software technologies. Our integrated approach to energy solutions maximizes a home’s energy potential while providing advanced monitoring and remote maintenance capabilities. The Enphase Energy System uses a single technology platform for seamless management of the whole solution of IQ® Microinverters, IQ® Batteries, IQ® Load Controllers, and IQ® EV Charger, allowing rapid commissioning with the Enphase® Installer App, consumption monitoring with our IQ® Combiner™ device with our Enphase IQ® Gateway™ device, and our Enphase® App, a cloud-based energy management platform. System owners can use the Enphase App to monitor their home’s solar generation, energy storage and consumption from any web-enabled device. Unlike some of our competitors, who utilize a traditional inverter, or offer separate components of solutions, we have built-in system redundancy in both photovoltaic generation and energy storage, eliminating the risk that comes with a single point of failure. Further, the nature of our cloud-based, monitored system allows for remote firmware and software updates, enabling cost-effective remote maintenance and ongoing utility compliance.

Enphase Energy, Inc. | 2026 Form 10-Q | 32

Table of Contents

We sell primarily to solar distributors who combine our products with others, including solar module products and racking systems, and resell to installers in each target region. In addition to our solar distributors, we sell directly to select large installers, original equipment manufacturers (“OEMs”) and strategic partners. Our OEM customers include solar module manufacturers who integrate our microinverters with their solar module products and resell to both distributors and installers. Strategic partners include a variety of companies, including industrial equipment suppliers, module companies, energy suppliers and developers of third-party solar finance offerings (such as TPOs). We also sell certain products and services to homeowners primarily in support of our warranty services and legacy product upgrade programs, via our online store.

Events Affecting our Business and Operations

As we have a growing global footprint, we are subject to risk and exposure from the evolving macroeconomic environment, including the effects of military conflicts (including the Iran conflict), increased global inflationary pressures, tariffs and interest rates, fluctuations in foreign currency exchange rates, potential economic slowdowns or recessions, geopolitical pressures and potential regulatory changes, including the unknown impacts of current and future trade regulations. We continuously monitor the direct and indirect impacts of these circumstances on our business and financial results.

One Big Beautiful Bill Act. In July 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted, introducing material changes to clean energy tax credit programs that are significant to our business and may impact our financial condition, results of operations and future prospects.

The OBBBA scales back the Investment Tax Credit (the “ITC”) available under Section 25D of the Internal Revenue Code of 1986, as amended (the “Code”), for residential solar and storage systems purchased through cash or loans. Under the new law, the Section 25D credit expired on December 31, 2025. In addition, the OBBBA imposes new timing requirements for eligibility under Section 48E of the Code, which governs ITCs for leased solar and storage systems. Specifically, solar-only projects that did not commence construction within 12 months of the OBBBA’s enactment must be placed in service by December 31, 2027 in order to remain eligible for the credit. Energy storage projects are not subject to this placed-in-service deadline; however, the ITC for storage systems will begin to phase down in 2034 — decreasing to 75% in 2034, 50% in 2035 and phasing out entirely by 2036.

The OBBBA also amends the domestic content bonus credit rules for Section 48E projects. Projects commencing construction after June 16, 2025 must meet a 45% domestic cost threshold, up from 40%.

Additionally, the OBBBA introduces new compliance requirements under the FEOC provisions for both Section 48E of the Code and the Advanced Manufacturing Production Tax Credit (“AMPTC”) under Section 45X of the Code. These provisions establish an escalating threshold of non-FEOC content that must be met by solar and storage projects beginning construction in 2026 and by manufactured components produced beginning in 2026.

In August 2025, U.S. Treasury Department and the Internal Revenue Service (“IRS”) issued revised “beginning of construction” guidance for clean energy tax credits that only applies to Section 48E projects above 1 MW.

In February 2026, the U.S. Treasury Department and the IRS issued guidance under the OBBBA’s FEOC provisions applicable to Sections 48E and 45X of the Code, including rules and interim safe harbors for determining whether projects or manufactured components receive material assistance from prohibited foreign entities. Treasury and the IRS have indicated that additional proposed regulations and safe harbor tables are expected, including guidance addressing ownership, effective control, debt, licensing arrangements and anti‑circumvention matters, which could make the compliance requirements more restrictive over time.

These legislative and regulatory developments have impacted and may in the future negatively impact our eligibility for certain tax credits, the attractiveness of our offerings to solar and storage system lease providers, or the overall demand for our products. If we are unable to meet the revised domestic content or FEOC requirements, our ability to qualify for these incentives could be impaired, which may adversely affect our revenue, gross margins, business operations and competitive position.

In March 2026, we entered into an agreement for the sale of $235.0 million of AMPTC we generated during 2025 at 93% of face value, resulting in a discount of approximately $16.5 million. We also incurred approximately $2.5 million in transaction-related fees.

In June 2026, we entered into an agreement for the sale of up to $150.0 million of AMPTC we generated during 2026 at 93% of face value. Of such $150.0 million, in June 2026 we sold $37.5 million of AMPTC generated

Enphase Energy, Inc. | 2026 Form 10-Q | 33

Table of Contents

in the first quarter of 2026 for approximately $34.9 million and incurred approximately $0.5 million in transaction-related fees.

Trade Tariff Uncertainties. The impact of new or existing tariffs, trade restrictions or retaliatory actions on us, the solar industry and our customers continues to create uncertainty and adversely affect our business operations. On February 20, 2026, the United States Supreme Court issued a decision invalidating certain tariffs previously imposed under the International Emergency Economic Powers Act ("IEEPA"). Following this ruling, the U.S. Court of International Trade directed U.S. Customs and Border Protection (“CBP”) to establish a process for the submission and review of refund claims related to eligible IEEPA tariffs. On April 20, 2026, CBP launched an online portal through which companies may submit refund requests for eligible IEEPA tariffs. We received refunds and associated interest of approximately $41.0 million and $11.0 million in the three months ended June 30, 2026 and in July 2026, respectively, from CBP related to tariffs paid during fiscal 2025 and the first quarter of fiscal 2026, of which $45.4 million was recognized as a reduct

[Excerpt truncated for page length; source filing is linked above.]

## Latest 10-K MD&A (excerpt)

Latest 10-K Item 7 source: https://www.sec.gov/Archives/edgar/data/1463101/000146310126000013/enph-20251231.htm
Complete FY 2025 MD&A: /company/ENPH/mda/fy2025/

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary.
Confidence: high
Filing date: 2026-02-17
Report date: 2025-12-31

Item 7.    Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following section generally discusses 2025 results compared to 2024 results. Discussion of 2024 results compared to 2023 results to the extent not included in this report can be found in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024.

Business Overview and 2025 Highlights

We are a global energy technology company. We deliver smart, easy-to-use solutions that manage solar generation, storage and communication on one platform. Our intelligent microinverters work with virtually every solar panel made, and when paired with our smart technology, result in one of the industry’s best-performing clean energy systems. As of December 31, 2025, we have shipped approximately 86.4 million microinverters, and more than 5.1 million Enphase residential and commercial systems have been deployed in over 160 countries.

We sell primarily to solar distributors who combine our products with others, including solar module products and racking systems, and resell to installers in each target region. In addition to our solar distributors, we sell directly to select large installers, OEMs and strategic partners. Our OEM customers include solar module manufacturers who integrate our microinverters with their solar module products and resell to both distributors and installers. Strategic partners include a variety of companies, including industrial equipment suppliers, module companies, energy suppliers and developers of third-party solar finance offerings (such as TPOs). We also sell certain products and services to homeowners primarily in support of our warranty services and legacy product upgrade programs, via our online store.

During fiscal year 2025, our priorities included providing excellent customer service; scaling U.S. manufacturing and advancing product qualification to take advantage of both the Section 48E investment tax credit and the AMPTC under Section 45X of the Code; enhancing our Enphase Energy System offering through continued product innovation and system integration; broadening our ecosystem capabilities through collaboration with utilities and the development of VPPs; strengthening partnerships with installers and TPOs through safe harbor agreements; and increasing operating efficiencies while reducing costs.

Enphase Energy, Inc. | 2025 Form 10-K | 49

Table of Contents

To mitigate supply chain risks and tariff exposure and to leverage U.S. manufacturing incentives, we continued to operate our domestic manufacturing footprint, including our in‑house manufacturing facility and our partnership with Flex. These arrangements maintained a combined manufacturing capacity of approximately five-million microinverters per quarter. Beginning in the second half of 2024, we began shipping residential and commercial microinverters and batteries with higher domestic content from U.S. manufacturing facilities, which are expected to help certain solar and battery projects qualify for the domestic content bonus tax credit. The domestic content bonus tax credit is only available to commercial asset owners, which includes commercial businesses adding solar and power purchase agreements/lease providers who own residential solar projects.

Events Affecting our Business and Operations

As we have a growing global footprint, we are subject to risk and exposure from the evolving macroeconomic environment, including the effects of increased global inflationary pressures, tariffs and interest rates, fluctuations in foreign currency exchange rates, potential economic slowdowns or recessions, geopolitical pressures and potential regulatory changes, including the unknown impacts of current and future trade regulations. We continuously monitor the direct and indirect impacts of these circumstances on our business and financial results.

One Big Beautiful Bill Act. In July 2025, the OBBBA was enacted, introducing material changes to clean energy tax credit programs that are significant to our business and may impact our financial condition, results of operations and future prospects.

The OBBBA scales back the ITC available under Section 25D of the Code for residential solar and storage systems purchased through cash or loans. Under the new law, the Section 25D credit expired on December 31, 2025. In addition, the OBBBA imposes new timing requirements for eligibility under Section 48E of the Code, which governs ITCs for leased solar and storage systems. Specifically, solar-only projects that do not commence construction within 12 months of the OBBBA’s enactment must be placed in service by December 31, 2027 in order to remain eligible for the credit. Energy storage projects are not subject to this placed-in-service deadline; however, the ITC for storage systems will begin to phase down in 2034 — decreasing to 75% in 2034, 50% in 2035 and phasing out entirely by 2036.

The OBBBA also amends the domestic content bonus credit rules for Section 48E projects. Projects commencing construction after June 16, 2025 must meet a 45% domestic cost threshold, up from 40%.

Additionally, the OBBBA introduces new compliance requirements under the FEOC provisions for both Section 48E and the AMPTC under Section 45X. These provisions establish an escalating threshold of non-FEOC content that must be met by solar and storage projects beginning construction in 2026 and by manufactured components produced beginning in 2026.

On July 7, 2025, the President issued an Executive Order directing the Secretary of the Treasury to issue updated guidance within 45 days on the “beginning of construction” requirements applicable to Section 48E projects. In August 2025, Treasury and the IRS issued revised “beginning of construction” guidance for clean energy tax credits that only applies to projects above 1MW. The Executive Order also requires the Secretary to implement the FEOC restrictions set forth in the OBBBA. Additional guidance around FEOC guidance is still forthcoming and is expected to be finalized in 2026, which could make existing requirements more stringent.

These legislative and regulatory developments have impacted and may in the future negatively impact our eligibility for certain tax credits, the attractiveness of our offerings to solar and storage system lease providers, or the overall demand for our products. If we are unable to meet the revised domestic content or FEOC requirements, our ability to qualify for these incentives could be impaired, which may adversely affect our revenue, gross margins, business operations and competitive position.

Trade Tariff Uncertainties. The impact of new or existing tariff, trade restrictions or retaliatory actions on us, the solar industry and our customers continue to create uncertainty and impact on our business operations. We have relocated a significant portion of our manufacturing to the United States while continuing to utilize contract manufacturing in China and India. However, certain critical components for our products are still sourced from outside the United States.

For example, LFP battery cells used in our energy storage systems are still supplied exclusively by two vendors located in China. While we are actively exploring alternative suppliers outside of China, the global supply chain for LFP battery cells remains heavily concentrated in China, and identifying qualified suppliers with the necessary expertise and capacity remains challenging.

Enphase Energy, Inc. | 2025 Form 10-K | 50

Table of Contents

An escalation in trade tensions or the implementation of broader tariffs, trade restrictions or retaliatory measures on our products or components originating from countries outside the United States could adversely impact our ability to source necessary components, manufacture products at competitive cost, or sell our products at prices customers are willing to pay. Any such developments could materially and adversely affect our business operations, results of operations and cash flows.

Safe Harbor Agreements. During the year ended December 31, 2025, we entered into multiple safe harbor agreements with customers, including solar and battery financing companies that offer TPO arrangements to homeowners, such as leases and power purchase agreements. These agreements reflect our increasing engagement in the TPO segment, which we expect to be an important growth channel for U.S. residential solar and battery adoption following the expiration of the ITC available under Section 25D of the Code on December 31, 2025. The timing and structure of these safe harbor transactions have resulted in higher variability in our quarterly revenue recognition and overall financial performance.

Demand for Products. The prolonged softness in demand in the solar industry has continued to adversely impact certain distributors and installers, contributing to reduced liquidity, bankruptcies and business closures across the channel. These disruptions have negatively affected our revenue and profitability and could result in higher allowances for credit losses in the future. In Europe, the overall business environment across the region is still challenging, and is expected to remain constrained in 2026. In the United States, uncertainty related to changes in legislation, including from the OBBBA, which eliminates or reduces existing tax credits for clean energy programs, as well as evolving U.S. trade and tariff policies, may further contribute to market volatility and adversely impact customer demand for our products, pricing and our financial performance.

Components of Consolidated Statements of Operations

Net Revenues

We generate revenue from the sale of our various products, which include microinverter units and related accessories, IQ Battery and related accessories, IQ PowerPack 1500 and related accessories, EV charging solutions, IQ Combiner, IQ Gateway and IQ Energy Router, as well as from the sale of services, which include cloud-based monitoring services, design, proposal, permitting, installation and solar appointment generation services, and Enphase Care services.

Our revenue is affected by changes in the volume and ASPs of our various solutions and related accessories, supply and demand, sales incentives, government incentives and competitive product offerings. Our revenue growth is dependent on our ability to compete effectively in the marketplace by remaining cost competitive, macroeconomic conditions, favorable regulatory environment, developing and introducing new products that meet the changing technology and the performance requirements of our customers, the diversification and expansion of our revenue base, and our ability to market our products in a manner that increases awareness for microinverter technology and differentiates us in the marketplace.

Cost of Revenues and Gross Profit

Cost of revenues is comprised primarily of product costs, warranty, manufacturing and installation services, support personnel, logistics costs, freight costs, inventory write-downs, hosting services costs related to our cloud-based monitoring services, depreciation of manufacturing and test equipment, amortization of capitalized software development costs related to our cloud-based monitoring services, lead acquisition costs and design and proposal services, employee-related expenses associated with proposal and permitting services and design and proposal service customer support. AMPTC earned under the IRA for U.S. manufactured microinverters shipped to customers are treated as a reduction to cost of revenues.

Our product costs are impacted by technological innovations, such as advances in semiconductor integration and new product introductions, economies of scale resulting in lower component costs, and improvements in production processes and automation. Certain costs, primarily personnel and depreciation and amortization of equipment

[Excerpt truncated for page length; the complete text is on the linked full-MD&A page.]

Read the full FY 2025 MD&A: /company/ENPH/mda/fy2025/
All MD&A years: /company/ENPH/mda/


## MD&A history

Prior-year 10-K MD&A spans are extracted from SEC filings with the same bounded parser used for the latest filing. Each year's full verbatim text is on its own sub-page.

- [FY 2024 MD&A](/company/ENPH/mda/fy2024/): filed 2025-02-10; accession 0001463101-25-000024 (https://www.sec.gov/Archives/edgar/data/1463101/000146310125000024/enph-20241231.htm)
- [FY 2023 MD&A](/company/ENPH/mda/fy2023/): filed 2024-02-09; accession 0001463101-24-000024 (https://www.sec.gov/Archives/edgar/data/1463101/000146310124000024/enph-20231231.htm)
- [FY 2022 MD&A](/company/ENPH/mda/fy2022/): filed 2023-02-13; accession 0001463101-23-000025 (https://www.sec.gov/Archives/edgar/data/1463101/000146310123000025/enph-20221231.htm)
- [FY 2021 MD&A](/company/ENPH/mda/fy2021/): filed 2022-02-11; accession 0001463101-22-000016 (https://www.sec.gov/Archives/edgar/data/1463101/000146310122000016/enph-20211231.htm)




## Macro cross-references

Indicators mapped to this company's SIC classification (industry 3674 Semiconductors & Related Devices) by grepcent's deterministic macro-sector crosswalk. A navigational mapping, not a statistical or causal claim.

- [INDPRO](/indicator/INDPRO/): Industrial Production: Total Index
- [TCU](/indicator/TCU/): Capacity Utilization: Total Index
- [PPIACO](/indicator/PPIACO/): Producer Price Index by Commodity: All Commodities
- [GDPC1](/indicator/GDPC1/): Real Gross Domestic Product
- [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate
- [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private
- [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm

Macro-to-micro threads including this sector: [Inflation (CPI / PCE / PPI)](/thread/inflation-cpi-pce-ppi/), [US labor market](/thread/us-labor-market/), [Growth & output](/thread/growth-output/), [Money & trade](/thread/money-trade/), [Government finances](/thread/government-finances/), [Sector employment](/thread/sector-employment/), [Industrial orders & inventories](/thread/industrial-orders/), [Trade & external](/thread/trade-external/).

All macro indicators: /indicators/


## For LLMs & downloads

Markdown twin: /company/ENPH.md · JSON record: /company/ENPH.json · verified financials: /company/ENPH/financials.json / /company/ENPH/financials.csv · machine TOC for the whole site: /llms.txt