Canadian Solar Shifts Focus to US Manufacturing as Second-Quarter Loss Widens Sharply
Kitchener, Ontario — Canadian Solar is restructuring its business: the Canadian solar company is shifting its strategic focus from global volume growth in solar modules to higher-value business segments, led by manufacturing in the United States. The loss widened significantly in the second quarter, while the storage business is gaining increasing importance.
US Manufacturing: HJT Plant in Jeffersonville Begins Operations
In July 2026, Canadian Solar started operations at the first phase of its HJT cell plant in Jeffersonville, Indiana. Phase I has a capacity of 2.1 GWp and, according to the company, is the first commercial-scale HJT cell production facility in the United States. Trial production for Phase II is scheduled to begin in the first quarter of 2027 and will add 4.2 GWp, bringing US cell capacity to 6.3 GWp by the first half of 2027. Together with the module plant in Mesquite, Texas, which has been expanded to 10 GWp from 5 GWp previously, CS PowerTech aims to become one of the leading integrated PV manufacturers in North America, according to the company. "In July, we celebrated the official opening of our state-of-the-art HJT solar cell factory, marking a historic milestone, as Canadian Solar became... the first commercially operational HJT manufacturer in the United States," said Colin Parkin, CEO of Canadian Solar.
Storage: e-STORAGE Tops Its Own Guidance
Canadian Solar's storage division, e-STORAGE, delivered 3.7 GWh in the second quarter, exceeding its own guidance of 2.8 to 3.2 GWh, up 82 percent quarter-on-quarter and 73 percent year-on-year. e-STORAGE's order backlog stood at USD 3.5 billion as of June 30, 2026. The module business, by contrast, was weaker: module shipments of 3.1 GW were up 25 percent quarter-on-quarter but down 60 percent year-on-year.
Financial Results: Revenue Rises Quarter-on-Quarter, Loss Widens Further
Revenue reached USD 1.2 billion in the second quarter (Q2 2025: USD 1.7 billion), up 12 percent quarter-on-quarter but down 29 percent year-on-year. Gross margin fell to 13.9 percent (Q2 2025: 29.8 percent). The net loss attributable to Canadian Solar shareholders totaled USD 77 million, or USD 1.40 per share, in the second quarter (Q2 2025: net income of USD 7 million on a loss of USD 0.08 per share). For the first half of 2026, the net loss totaled USD 109 million (H1 2025: USD 27 million), while consolidated revenue fell to USD 2.29 billion (H1 2025: USD 2.89 billion). "The sequential decrease in gross margin was primarily driven by the absence of a tariff refund recognized in the prior period, alongside normalized energy storage margins," said Xinbo Zhu, Senior Vice President and CFO of Canadian Solar. For the third quarter, Canadian Solar expects revenue of between USD 1.3 billion and USD 1.5 billion, with a gross margin of 13.5 to 15.5 percent.
Policy Backdrop: Tax Conditions for US Solar Industry Shift
The OBBBA, passed in July 2025, shortened the window for tax credits on new solar and wind projects in the United States. Solar and wind facilities that begin construction after July 4, 2026 will lose eligibility for tax credits under Sections 45Y and 48E if they are placed in service after December 31, 2027. The Section 45X production tax credit for US manufacturing, however, has largely remained intact: it applies to solar and battery components through 2029 as scheduled and will then be phased down through 2032. The expansion of the Jeffersonville plant and the capacity increase in Texas therefore fall within a period of changed, but not fundamentally ended, tax conditions.
Market Reaction: Canadian Solar Shares Continue to Decline
Canadian Solar shares closed at EUR 11.80 on the Stuttgart Stock Exchange on August 27, 2026, down 0.7 percent from the previous day's close of EUR 11.88. The stock is down 42.7 percent since the start of the year.
Source: IWR Online, 28 Aug 2026
