(Updates with closing share prices in second paragraph.)
Nov. 14 (Bloomberg) -- JinkoSolar Holding Co. and Daqo New Energy Corp., two Chinese solar manufacturers, dropped after missing sales targets for the third quarter, citing oversupply and weak demand for solar components.
JinkoSolar, a panel maker, slipped 13 percent to $6.75 in New York, the most since Sept. 19. Daqo, a polysilicon maker, fell 4.2 percent to $2.71.
The two companies are the latest to say that slowing demand growth and a global surplus of solar components are cutting into revenue. Manufacturers have boosted production even as prices for materials ranging from polysilicon to panels plummeted, sending three U.S. solar companies including Solyndra LLC into bankruptcy this year.
“The global solar photovoltaic market remained challenging in the third quarter due to the weak demand and industry oversupply,” Gongda Yao, Daqo’s chief executive officer, said in a statement today. “Average selling prices throughout the whole supply chain continued to decline.”
Daqo said revenue in the third quarter was $59.6 million, down 5.7 percent from $63.2 million in the same period a year earlier. The company shipped 1,022 metric tons of polysilicon, the raw material used in solar panels. Analysts had expected the Wanzhou-based company to report sales of $71.5 million, the average of five estimates compiled by Bloomberg.
Net income fell 32 percent to $12.1 million as gross margin, a measure of profitability after production costs, narrowed to 33 percent from 42.5 percent.
JinkoSolar said revenue for the third quarter will be as much as 18 percent lower than the Jiangxi-based company had previously forecast. The company will release its full report Nov. 21.
JinkoSolar’s revenue will be about $270 million to $280 million, compared with an earlier forecast of $310 million to $330 million, the company said in a statement today. The company also lowered its module-shipment forecast for the quarter to 210 to 220 megawatts, from 230 to 250 megawatts.
Sales for the full year will be $1.1 billion to $1.2 billion, compared with JinkoSolar’s earlier forecast of $1.4 billion to $1.5 billion.
Overcapacity and slowing demand are driving down sales at other solar companies around the world. Solarworld AG and Q- Cells SE, Germany’s biggest solar cell and panel manufacturers, plunged in Frankfurt trading today after reporting wider-than- expected losses.
SunPower Corp. and First Solar Inc., the biggest U.S. solar manufacturers, said Nov. 3 they will reorganize after cutting their forecasts.
For Additional News and Information: JinkoSolar News: JKS US <EQUITY> CN BN <GO> Daqo New Energy Earnings Matrix: DQ US <Equity> EM <GO> Most- read solar energy stories: MNI SOLAR <GO> Top renewable energy news: GREEN <GO>
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