FLNC Q1 Earnings Call: Tariffs Drive Guidance Cut as Supply Chain Strategy Tested
Is now the time to buy FLNC? Find out in our full research report (it's free).
Revenue: $431.6 million vs analyst estimates of $343.5 million (30.7% year-on-year decline, 25.7% beat)
Adjusted EBITDA: -$30.41 million vs analyst estimates of -$31.55 million (-7% margin, 3.6% beat)
The company dropped its revenue guidance for the full year to $2.7 billion at the midpoint from $3.4 billion, a 20.6% decrease
EBITDA guidance for the full year is $10 million at the midpoint, below analyst estimates of $49.82 million
Operating Margin: -10.4%, down from -2.5% in the same quarter last year
Market Capitalization: $649.7 million
Fluence Energy's first quarter results were shaped by rapid changes in the U.S. policy landscape and ongoing supply chain adjustments. CEO Julian Nebreda pointed to earlier-than-anticipated project milestone completions, especially in the Americas and Asia-Pacific, as contributors to revenue for the period. Management emphasized that efficiencies gained from the company's supply chain initiatives allowed it to deliver on key contracts despite a challenging market. Additionally, recurring digital and services revenue continued to show momentum, with annual recurring revenue reaching $110 million. Nebreda was clear that the company's backlog remains robust, ending the quarter at $4.9 billion, and attributed the current margin profile to increased R&D and go-to-market investments, primarily supporting the rollout of its new Smartstack platform.
Looking forward, Fluence Energy's full-year guidance reflects significant caution due to new U.S. tariffs on Chinese battery imports and resulting uncertainty for domestic projects. Nebreda explained, 'The change in tariff and trade policy has led to considerable economic uncertainty in global markets,' leading to a mutual pause in U.S. contract execution between Fluence and some customers. Management expects the current contracting slowdown to be temporary, but acknowledged that visibility into the timing of a market rebound is limited. CFO Ahmed Pasha highlighted that the company's revised outlook incorporates both the paused contracts and anticipated tariff-related headwinds, while reaffirming strategic priorities like scaling domestic production and expanding internationally. Nebreda concluded that the company's flexible supply chain and product innovation should position it to recover as the policy environment stabilizes.
Management attributed the quarter's financial performance to early project execution, ongoing supply chain initiatives, and the rapid policy shifts impacting the U.S. energy storage market. Product innovation and a diversified backlog were also central themes.
Early project milestone delivery: Fluence completed key contract milestones ahead of schedule in the Americas and Asia-Pacific, benefiting from operational efficiencies and helping offset some volume softness in the U.S.
Tariff-driven contract pauses: New U.S. tariffs on Chinese batteries (rising from roughly 10% to 155%) introduced substantial uncertainty, prompting Fluence and its customers to pause both signed and pending domestic contracts until the policy environment becomes clearer.
Smartstack product rollout: The company's newly launched Smartstack platform received its first customer contract and positive feedback, with management highlighting its modular design, safety features, and lower cost structure compared to previous offerings.
International diversification: While U.S. order intake slowed, Fluence's pipeline exceeded $22 billion with about half from international markets, providing some resilience as domestic contracting pauses.
Domestic content strategy progress: All six U.S. supply chain partner facilities are now operational or ramping up, allowing Fluence to offer up to 100% non-Chinese products and helping customers qualify for domestic content incentives under the Inflation Reduction Act (IRA).
Fluence's guidance is shaped by the impact of tariffs, cautious U.S. market conditions, and a strategic emphasis on international and domestic supply chain flexibility.
Tariff and policy uncertainty: Management sees recently enacted tariffs as the primary reason for paused U.S. projects and reduced guidance, with the timeline for resolution dependent on ongoing trade negotiations and customer willingness to commit under current cost structures.
Domestic supply chain ramp-up: The success of Fluence's domestic content strategy, including scaling battery module production and blending domestic and imported components, will determine its ability to capture U.S. demand and manage costs if tariffs persist.
International growth opportunities: With a growing backlog and pipeline in markets such as Australia and Germany, international project execution and Smartstack adoption are expected to be key drivers as the company seeks to offset U.S. headwinds.
In the coming quarters, the StockStory team will watch (1) the resolution of U.S. tariff policy and its impact on paused contracts, (2) the pace of Smartstack adoption and customer feedback in both U.S. and international markets, and (3) the operational ramp-up of domestic cell manufacturing and supply chain partners. Progress in international markets and ongoing cost management will also be critical signposts.
Fluence Energy currently trades at a forward P/E ratio of 12.2×. At this valuation, is it a buy or sell post earnings? The answer lies in our full research report (it's free).
The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.
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President Trump called out Goldman Sachs' (GS) research team for a stock market forecast it made earlier in the year, which initially predicted the S&P 500 (^GSPC) would finish the year lower as the US economy entered recession following the initial "Liberation Day" tariff announcements. Specifically, Trump targeted Goldman Sachs CEO David Solomon in a Truth Social Post Tuesday while also taking a pass at the executive's hobby as a DJ. "David Solomon and Goldman Sachs refuse to give credit where credit is due," Trump wrote in a Tuesday post in Truth Social while lauding the revenue tariffs are bring in and a stock market that's hovering near record highs. "They made a bad prediction a long time ago on both the Market repercussion and the Tariffs themselves, and they were wrong, just like they are wrong about so much else. I think that David should go out and get himself a new Economist or, maybe, he ought to just focus on being a DJ, and not bother running a major Financial Institution." Goldman Sachs declined to comment on the post. Read more here. Ethereum treasury company Bitmine Immersion plans to issue $20 billion worth of stock to buy more ETH Yahoo Finance's Jake Conley reports: Bitmine Immersion Technologies (BMNR) stock popped as much as 5% at the opening bell on Tuesday after ethereum (ETH-USD) rose another 5% to trade north of $4,400 and the company announced plans to sell up to another $20 billion worth of stock to increase its holdings of the cryptocurrency. Bitmine, whose board is led by investor Tom Lee, announced Monday that its holdings of ETH stood at $4.96 billion, or a little over 1.15 million tokens, meaning the company owns roughly 1% of all tokens in circulation. The company's goal is to eventually acquire 5% of the world's outstanding ETH tokens. Monday's news pushed the stock up more than 14%. The stock is up over 600% this year. Read more here. Yahoo Finance's Jake Conley reports: Bitmine Immersion Technologies (BMNR) stock popped as much as 5% at the opening bell on Tuesday after ethereum (ETH-USD) rose another 5% to trade north of $4,400 and the company announced plans to sell up to another $20 billion worth of stock to increase its holdings of the cryptocurrency. Bitmine, whose board is led by investor Tom Lee, announced Monday that its holdings of ETH stood at $4.96 billion, or a little over 1.15 million tokens, meaning the company owns roughly 1% of all tokens in circulation. The company's goal is to eventually acquire 5% of the world's outstanding ETH tokens. Monday's news pushed the stock up more than 14%. The stock is up over 600% this year. Read more here. Everybody's buying the stock market dips now When markets first bounced off the April bottom, there was a flurry of data showing that retail traders had led the dip-buying. Many market bulls argued that this left room for institutional buying to pour into the market in the coming months and continue to lead stocks higher. Following the worst day of the summer for stocks, when the market sold off after a weaker-than-expected July jobs report, that's exactly what happened. Data from Bank of America released on Tuesday showed net buys by institutional clients were the biggest since September 2024 and the 10th-largest in history since 2008. Those clients preferred large-cap technology stocks. The $4.3 billion poured into single stocks last week by BofA clients marked the largest weekly inflow in two years. When markets first bounced off the April bottom, there was a flurry of data showing that retail traders had led the dip-buying. Many market bulls argued that this left room for institutional buying to pour into the market in the coming months and continue to lead stocks higher. Following the worst day of the summer for stocks, when the market sold off after a weaker-than-expected July jobs report, that's exactly what happened. Data from Bank of America released on Tuesday showed net buys by institutional clients were the biggest since September 2024 and the 10th-largest in history since 2008. Those clients preferred large-cap technology stocks. The $4.3 billion poured into single stocks last week by BofA clients marked the largest weekly inflow in two years. One reason July's CPI data supports the case for Fed rate cuts At a high level, July's Consumer Price Index (CPI) had a bit of something for everyone. The latest data from the Bureau of Labor Statistics showed that "core" inflation, which excludes volatile food and energy costs, rose 3.1% over the past year in July, ahead of June's 2.9% increase. But on a headline basis, the Consumer Price Index (CPI) increased 2.7% on an annual basis in July, matching June's number and slower than economists' expectations of a 2.8% rise. In a note to clients following the release, Renaissance Marco's head of economics Neil Dutta zoomed in on the headline increase, which came in better than expected. "If tariffs are causing an inflation problem, then headline inflation rates ought to be accelerating," Dutta wrote. "However, overall inflation is not rising as rapidly as expected likely because nominal growth remains sluggish." Dutta points out that over the past six months, headline CPI has increased at a 1.9% annualized rate, the slowest pace seen since October 2024. In his view, July's CPI data "cements" a September interest rate cut from the Fed. Markets seem to agree for now, with traders pricing in a roughly 94% chance the Fed lowers rates in September, per the CME FedWatch Tool. "You might be thinking, why not a bigger upfront move," Dutta wrote. "Doves on the FOMC need to fight one battle at a time. There is a wide contingent of folks on the FOMC with tariff derangement syndrome, not seeing cuts at all this year. They won't be able to make the leap from no cuts to a large upfront move overnight." At a high level, July's Consumer Price Index (CPI) had a bit of something for everyone. The latest data from the Bureau of Labor Statistics showed that "core" inflation, which excludes volatile food and energy costs, rose 3.1% over the past year in July, ahead of June's 2.9% increase. But on a headline basis, the Consumer Price Index (CPI) increased 2.7% on an annual basis in July, matching June's number and slower than economists' expectations of a 2.8% rise. In a note to clients following the release, Renaissance Marco's head of economics Neil Dutta zoomed in on the headline increase, which came in better than expected. "If tariffs are causing an inflation problem, then headline inflation rates ought to be accelerating," Dutta wrote. "However, overall inflation is not rising as rapidly as expected likely because nominal growth remains sluggish." Dutta points out that over the past six months, headline CPI has increased at a 1.9% annualized rate, the slowest pace seen since October 2024. In his view, July's CPI data "cements" a September interest rate cut from the Fed. Markets seem to agree for now, with traders pricing in a roughly 94% chance the Fed lowers rates in September, per the CME FedWatch Tool. "You might be thinking, why not a bigger upfront move," Dutta wrote. "Doves on the FOMC need to fight one battle at a time. There is a wide contingent of folks on the FOMC with tariff derangement syndrome, not seeing cuts at all this year. They won't be able to make the leap from no cuts to a large upfront move overnight." Stocks open higher US stocks moved higher on Tuesday as Wall Street digested fresh inflation data and President Trump revealed his pick to head the Bureau of Labor Statistics. The Dow Jones Industrial Average (^DJI) rose about 0.5%. The S&P 500 (^GSPC) popped 0.4%, while the tech-heavy Nasdaq (^IXIC) led the gains rising more than 0.5%. US stocks moved higher on Tuesday as Wall Street digested fresh inflation data and President Trump revealed his pick to head the Bureau of Labor Statistics. The Dow Jones Industrial Average (^DJI) rose about 0.5%. The S&P 500 (^GSPC) popped 0.4%, while the tech-heavy Nasdaq (^IXIC) led the gains rising more than 0.5%. September Fed rate cut bets hold steady following CPI Following Tuesday's July inflation reading, market bets on a Federal Reserve interest rate cut held relatively steady. Investors are now pricing in a roughly a 90% chance the central bank cuts rates in September, up slightly from a 86% chance seen the day prior, per the CME FedWatch Tool. Following Tuesday's July inflation reading, market bets on a Federal Reserve interest rate cut held relatively steady. Investors are now pricing in a roughly a 90% chance the central bank cuts rates in September, up slightly from a 86% chance seen the day prior, per the CME FedWatch Tool. 'Core' price increases accelerate more than expected in July Price increases accelerated more than expected in July. The latest data from the Bureau of Labor Statistics showed that on a "core" basis, which strips out the more volatile costs of food and gas, consumer prices increased 3.1% over the prior year in July, an increase from June's 2.9% and above economists' forecast for 3%. Core prices climbed 0.3% over the prior month, ahead of June's 0.2% increase but in line with expectations. The headline Consumer Price Index (CPI) showed prices increased 2.7% in July, unchanged from the month prior and below the 2.8% economists had expected. On a month-over-month basis, prices increased 0.2%, lower than the 0.3% seen the month prior. Price increases accelerated more than expected in July. The latest data from the Bureau of Labor Statistics showed that on a "core" basis, which strips out the more volatile costs of food and gas, consumer prices increased 3.1% over the prior year in July, an increase from June's 2.9% and above economists' forecast for 3%. Core prices climbed 0.3% over the prior month, ahead of June's 0.2% increase but in line with expectations. The headline Consumer Price Index (CPI) showed prices increased 2.7% in July, unchanged from the month prior and below the 2.8% economists had expected. On a month-over-month basis, prices increased 0.2%, lower than the 0.3% seen the month prior. Circle stock jumps on first earnings report since going public Circle (CRCL) posted higher revenue and reserve income on Tuesday in its first quarterly report since its IPO in June, as circulation of its stablecoin USDC (USDC-USD) spread. Circle stock rose 6% in premarket trading on Tuesday. Its total gains since going public are now 133%. Reuters reports: Read more here. Circle (CRCL) posted higher revenue and reserve income on Tuesday in its first quarterly report since its IPO in June, as circulation of its stablecoin USDC (USDC-USD) spread. Circle stock rose 6% in premarket trading on Tuesday. Its total gains since going public are now 133%. Reuters reports: Read more here. US small business optimism rebounds, but uncertainty clouds outlook Reuters reports: Read more here. Reuters reports: Read more here. Good morning. Here's what's happening today. Economic data: NFIB Small Business Optimism (July); Consumer Price Index (July); Real average hourly earnings (July) Earnings: Circle (CRCL), Pony AI (PONY), On Holding (ONON), CoreWeave (CRWV), Rigetti (RGTI), Cava (CAVA) Here are some of the biggest stories you may have missed overnight and early this morning: July inflation report expected to show prices accelerated Media musical chairs are reshaping the sports landscape Earnings live: Circle pops on higher revenue in first earnings report Intel stock rises after Trump praises CEO's 'amazing story' China urges firms to shun Nvidia chips, trade truce extended Musk accuses Apple of unfairly favoring OpenAI on iPhone Google and IBM believe workable quantum computer is in sight US small business optimism up but uncertainty clouds outlook Switzerland wants binding Trump commitment on gold tariffs Economic data: NFIB Small Business Optimism (July); Consumer Price Index (July); Real average hourly earnings (July) Earnings: Circle (CRCL), Pony AI (PONY), On Holding (ONON), CoreWeave (CRWV), Rigetti (RGTI), Cava (CAVA) Here are some of the biggest stories you may have missed overnight and early this morning: July inflation report expected to show prices accelerated Media musical chairs are reshaping the sports landscape Earnings live: Circle pops on higher revenue in first earnings report Intel stock rises after Trump praises CEO's 'amazing story' China urges firms to shun Nvidia chips, trade truce extended Musk accuses Apple of unfairly favoring OpenAI on iPhone Google and IBM believe workable quantum computer is in sight US small business optimism up but uncertainty clouds outlook Switzerland wants binding Trump commitment on gold tariffs Cannabis stocks soar as President Trump considers reclassifying marijuana Tilray (TLRY) stock rose another 10% in premarket trading on Tuesday after soaring 41% on Monday amid speculation that President Trump may move to reclassify marijuana as a less dangerous drug. The Canadian cannabis company traded hands at over $1 per share for the first time since February. Despite a 60% gain in the past month, however, shares are still off by 30% for the year. Other cannabis stocks saw a major lift as well. Trulieve (TCNNF) gained 38% on Monday, Curaleaf (CURLF) was up 35%, Green Thumb Industries (GTBIF) added 19%, Aurora (ACB) increased 16%, and Canopy Growth (CGC) surged 26%. On Friday, the Wall Street Journal reported that Trump told donors at a New Jersey fundraiser he was considering making marijuana a Schedule III drug, which would ease restrictions on the substance. Trump said he will make a final decision in the coming weeks. "We're looking at reclassification and we'll make a determination over the next — I would say over the next few weeks, and that determination hopefully will be the right one," Trump said. "It's a very complicated subject." Tilray (TLRY) stock rose another 10% in premarket trading on Tuesday after soaring 41% on Monday amid speculation that President Trump may move to reclassify marijuana as a less dangerous drug. The Canadian cannabis company traded hands at over $1 per share for the first time since February. Despite a 60% gain in the past month, however, shares are still off by 30% for the year. Other cannabis stocks saw a major lift as well. Trulieve (TCNNF) gained 38% on Monday, Curaleaf (CURLF) was up 35%, Green Thumb Industries (GTBIF) added 19%, Aurora (ACB) increased 16%, and Canopy Growth (CGC) surged 26%. On Friday, the Wall Street Journal reported that Trump told donors at a New Jersey fundraiser he was considering making marijuana a Schedule III drug, which would ease restrictions on the substance. Trump said he will make a final decision in the coming weeks. "We're looking at reclassification and we'll make a determination over the next — I would say over the next few weeks, and that determination hopefully will be the right one," Trump said. "It's a very complicated subject." Intel is still a disaster Intel (INTC) is rallying premarket as Trump walked back his apparent hate for the company's CEO, Lip-Bu Tan, after meeting on Monday. Don't be fooled by the price action, however. This isn't the case like Apple (AAPL), where CEO Tim Cook kisses Trump's butt and the company is exempt from various tariffs. Intel is a fundamental disaster right now. People in the industry I talk to are unsure if the company will ever come back to a state of health, given 1) how fast AI chip development is occurring, and 2) how far behind Nvidia and AMD Intel is. Intel's statement on the meeting: "Earlier today, Mr. Tan had the honor of meeting with President Trump for a candid and constructive discussion on Intel's commitment to strengthening U.S. technology and manufacturing leadership. We appreciate the President's strong leadership to advance these critical priorities and look forward to working closely with him and his Administration as we restore this great American company." Intel (INTC) is rallying premarket as Trump walked back his apparent hate for the company's CEO, Lip-Bu Tan, after meeting on Monday. Don't be fooled by the price action, however. This isn't the case like Apple (AAPL), where CEO Tim Cook kisses Trump's butt and the company is exempt from various tariffs. Intel is a fundamental disaster right now. People in the industry I talk to are unsure if the company will ever come back to a state of health, given 1) how fast AI chip development is occurring, and 2) how far behind Nvidia and AMD Intel is. Intel's statement on the meeting: "Earlier today, Mr. Tan had the honor of meeting with President Trump for a candid and constructive discussion on Intel's commitment to strengthening U.S. technology and manufacturing leadership. We appreciate the President's strong leadership to advance these critical priorities and look forward to working closely with him and his Administration as we restore this great American company." Japan's Nikkei hits record high on tariff relief, tech rally The Nikkei 225 (^N225) hit a record high Tuesday as easing US tariff fears boosted optimism, led by tech stocks and tariff relief. Bloomberg News reports: Read more here. The Nikkei 225 (^N225) hit a record high Tuesday as easing US tariff fears boosted optimism, led by tech stocks and tariff relief. Bloomberg News reports: Read more here. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
