Sunrun Reports Second Quarter 2019 Financial Results

Customers now at 255,000, an increase of 26% year-over-year

Net Present Value created of $95 million in the quarter, an increase of 23% year-over-year

Net Earning Assets of $1.4 billion, an increase of 11% year-over-year

Total Cash increased $91 million from the prior year

SAN FRANCISCO, Aug. 07, 2019 (GLOBE NEWSWIRE) -- Sunrun (Nasdaq: RUN), the nation’s largest provider of residential solar, storage and energy services, today announced financial results for the second quarter ended June 30, 2019.

“Sunrun’s 255,000 customers are helping to build our future energy system where home solar and batteries will displace costly and harmful fossil fuel power plants,” said Lynn Jurich, Sunrun’s Chief Executive Officer and co-founder. “We continue to see strong demand from consumers and grid operators and expect we can deliver above-market growth rates again in 2019.”

Key Operating Metrics

In the second quarter of 2019, MW deployed increased to 103 MW from 91 MW in the second quarter of 2018, a 13% year-over-year increase.

Creation Cost per watt was $3.33 in the second quarter of 2019, compared to $3.12 in the second quarter of 2018.

NPV created in the second quarter of 2019 was $95 million, a 23% increase from $77 million in the second quarter of 2018. Unlevered NPV per watt in the second quarter of 2019 was $1.11. 

Gross Earning Assets as of June 30, 2019 were $3.3 billion, up $734 million, or 28% from the prior year. Net Earning Assets as of June 30, 2019 were $1.4 billion, up $139 million, or 11% from the prior year. 

Total Cash (meaning total cash, including restricted cash, less recourse debt) increased $91 million from the prior year.

Second Quarter 2019 GAAP Results

Total revenue grew to $204.6 million in the second quarter of 2019, up $34.1 million, or 20% from the second quarter of 2018. Customer agreements and incentives revenue grew 1% year-over-year to $92.4 million. Solar energy systems and product sales increased 42% year-over-year to $112.2 million.

Total cost of revenue was $156.9 million, an increase of 29% year-over-year. Total operating expenses were $267.4 million, an increase of 30% year-over-year.

Net loss attributable to common stockholders was $1.3 million in the second quarter of 2019.

Diluted net loss per share attributable to common stockholders was ($0.01) per share.

Guidance for Q3 and Full Year 2019

The following statements are based on current expectations. These statements are forward-looking and actual results may differ materially.

In Q3, we expect deployments to be in a range between 107 MW and 110 MW.

For the full year 2019, we continue to expect deployments to grow in a range between 16% and 18% year-over-year.

Financing Activities

As of August 7, 2019, closed transactions and executed term sheets provide us project debt capacity through 2019 and tax equity capacity into the second quarter of 2020.

Conference Call Information

Sunrun is hosting a conference call for analysts and investors to discuss its second quarter 2019 results and outlook for its third quarter 2019 at 2:00 p.m. Pacific Time today, August 7, 2019. A live audio webcast of the conference call along with supplemental financial information will be accessible via the “Investor Relations” section of the Company’s website at The conference call can also be accessed live over the phone by dialing (877) 470-1078 (domestic) or (615) 247-0087 (international) using ID #9471428. A replay will be available following the call via the Sunrun Investor Relations website or for one week at the following numbers (855) 859-2056 (domestic) or (404) 537-3406 (international) using ID #9471428.

About Sunrun                    

Sunrun (Nasdaq:RUN) is the nation’s leading residential solar, storage and energy services company.  With a mission to create a planet run by the sun, Sunrun has led the industry since 2007 with its solar-as-a-service model, which provides clean energy to households with little to no upfront cost and at a saving compared to traditional electricity. The company designs, installs, finances, insures, monitors and maintains the systems, while families receive predictable pricing for 20 years or more. The company also offers a home solar battery service, Sunrun Brightbox, that manages household solar energy, storage and utility power. For more information, please visit:

Forward Looking Statements

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995, including statements regarding our market leadership, competitive advantages, investments, market adoption rates, our future financial and operating guidance, operational and financial results such as growth, value creation, cash generation, MW deployments, estimates of gross and net earning assets, project value, estimated creation costs, gross orders, demand, NPV, and the assumptions related to the calculation of the foregoing metrics, as well as our expectations regarding our growth, financing activities, and financing capacity. The risks and uncertainties that could cause our results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to: the availability of additional financing on acceptable terms; changes in the retail prices of traditional utility generated electricity; changes in policies and regulations including net metering and interconnection limits or caps; the availability of rebates, tax credits and other incentives; the availability of solar panels and other raw materials; our limited operating history, particularly as a new public company; our ability to attract and retain our relationships with third parties, including our solar partners; our ability to meet the covenants in our investment funds and debt facilities; our continued ability to manage costs associated with solar service offerings, our business plan and our ability to effectively manage our growth and labor constraints, and such other risks identified in the reports that we file with the U.S. Securities and Exchange Commission, or SEC, from time to time. All forward-looking statements in this press release are based on information available to us as of the date hereof, and we assume no obligation to update these forward-looking statements.

Consolidated Balance Sheets
(In Thousands)
    June 30, 2019   December 31, 2018
Current assets:        
Cash   $ 299,537     $ 226,625  
Restricted cash   54,182     77,626  
Accounts receivable, net   77,846     66,435  
State tax credits receivable       2,697  
Inventories   89,829     79,467  
Prepaid expenses and other current assets   8,692     8,563  
Total current assets   530,086     461,413  
Restricted cash

  148     148  
Solar energy systems, net   4,149,883     3,820,017  
Property and equipment, net   50,419     34,893  
Intangible assets, net   8,382     10,088  
Goodwill   87,543     87,543  
Other assets   380,919     335,685  
Total assets   $ 5,207,380     $ 4,749,787  
Liabilities and total equity        
Current liabilities:        
Accounts payable   $ 153,206     $ 131,278  
Distributions payable to noncontrolling interests and redeemable noncontrolling interests   16,444     15,847  
Accrued expenses and other liabilities   104,328     98,636  
Deferred revenue, current portion   59,818     47,407  
Deferred grants, current portion   8,029     7,885  
Finance lease obligations, current portion   11,206     9,193  
Recourse debt, current portion   239,035      
Non-recourse debt, current portion   35,158     35,484  
Pass-through financing obligation, current portion   10,666     26,461  
Total current liabilities   637,890     372,191  
Deferred revenue, net of current portion   643,613     544,218  
Deferred grants, net of current portion   217,013     221,739  
Finance lease obligations, net of current portion   14,363     9,992  
Recourse debt       247,000  
Non-recourse debt, net of current portion   1,688,989     1,466,438  
Pass-through financing obligation, net of current portion   329,968     337,282  
Other liabilities   113,992     48,210  
Deferred tax liabilities   73,926     93,633  
Total liabilities   3,719,754     3,340,703  
Redeemable noncontrolling interests   278,539     126,302  
Total stockholders’ equity   915,545     948,707  
Noncontrolling interests   293,542     334,075  
Total equity   1,209,087     1,282,782  
Total liabilities, redeemable noncontrolling interests and total equity   $ 5,207,380     $ 4,749,787  

Consolidated Statements of Operations
(In Thousands, Except Per Share Amounts)
    Three Months Ended June 30,   Six Months Ended June 30,
    2019   2018   2019   2018
Customer agreements and incentives   $ 92,439     $ 91,605     $ 192,289     $ 158,595  
Solar energy systems and product sales   112,156     78,933     206,810     156,306  
Total revenue   204,595     170,538     399,099     314,901  
Operating expenses:                
Cost of customer agreements and incentives   70,594     57,769     140,087     112,345  
Cost of solar energy systems and product sales   86,348     64,268     164,147     128,847  
Sales and marketing   70,038     49,237     125,991     93,316  
Research and development   6,555     5,052     12,029     8,948  
General and administrative   33,044     28,130     62,107     61,023  
Amortization of intangible assets   814     1,051     1,707     2,102  
Total operating expenses   267,393     205,507     506,068     406,581  
Loss from operations   (62,798 )   (34,969 )   (106,969 )   (91,680 )
Interest expense, net   42,309     31,872     83,649     60,070  
Other expenses (income), net   1,388     508     6,144     (1,184 )
Loss before income taxes   (106,495 )   (67,349 )   (196,762 )   (150,566 )
Income tax (benefit) expense   (1,910 )   4,378     (5,271 )   12,581  
Net loss   (104,585 )   (71,727 )   (191,491 )   (163,147 )
Net loss attributable to noncontrolling interests and redeemable noncontrolling interests   (103,292 )   (79,136 )   (176,336 )   (198,588 )
Net (loss) income attributable to common stockholders   $ (1,293 )   $ 7,409     $ (15,155 )   $ 35,441  
Net (loss) income per share attributable to common stockholders                
Basic   $ (0.01 )   $ 0.07     $ (0.13 )   $ 0.33  
Diluted   $ (0.01 )   $ 0.06     $ (0.13 )   $ 0.31  
Weighted average shares used to compute net (loss) income per share attributable to common stockholders                
Basic   115,765     109,559     114,843     108,510  
Diluted   115,765     117,067     114,843     113,930  

Consolidated Statements of Cash Flows
(In Thousands)
    Six Months Ended June 30,   Three Months Ended June 30,
    2019   2018   2019   2018
Operating activities:                
Net loss   $ (191,491 )   $ (163,147 )   $ (104,585 )   $ (71,727 )
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:                
Depreciation and amortization, net of amortization of deferred grants   89,019     73,980     45,358     37,794  
Deferred income taxes   (5,271 )   12,582     (1,910 )   4,379  
Stock-based compensation expense   12,566     16,242     6,783     5,548  
Interest on pass-through financing obligations   12,378     7,002     5,906     3,903  
Reduction in pass-through financing obligations   (19,702 )   (10,142 )   (9,716 )   (5,114 )
Other noncash losses and expenses   6,714     12,131     5,225     6,464  
Changes in operating assets and liabilities:                
Accounts receivable   (12,848 )   495     (12,701 )   (5,722 )
Inventories   (10,362 )   13,123     (13,645 )   6,598  
Prepaid and other assets   (49,771 )   (34,013 )   (13,903 )   (20,690 )
Accounts payable   (1,567 )   (32,840 )   21,010     (19,858 )
Accrued expenses and other liabilities   1,525     31,676     (6,199 )   38,724  
Deferred revenue   112,195     15,190     10,347     7,734  
Net cash provided by (used in) operating activities   (56,615 )   (57,721 )   (68,030 )   (11,967 )
Investing activities:                
Payments for the costs of solar energy systems   (388,430 )   (346,962 )   (189,550 )   (183,772 )
Purchases of property and equipment   (13,950 )   (2,762 )   (11,433 )   (1,241 )
Net cash used in investing activities   (402,380 )   (349,724 )   (200,983 )   (185,013 )
Financing activities:                
Proceeds from state tax credits, net of recapture   2,329     10,434     (275 )   10,483  
Proceeds from issuance of recourse debt   55,000     2,000     15,000      
Repayment of recourse debt   (62,965 )   (2,000 )   (15,000 )    
Proceeds from issuance of non-recourse debt   541,249     250,232     359,597     154,332  
Repayment of non-recourse debt   (313,474 )   (48,677 )   (214,226 )   (41,555 )
Payment of debt fees   (7,462 )   (9,133 )   (4,808 )   (5,253 )
Proceeds from pass-through financing and other obligations   5,282     98,172     3,497     96,670  
Early repayment of pass-through financing obligation   (7,597 )            
Payment of finance lease obligations   (6,445 )   (4,081 )   (3,444 )   (1,968 )
Contributions received from noncontrolling interests and redeemable noncontrolling interests   330,311     167,468     178,162     23,864  
Distributions paid to noncontrolling interests and redeemable noncontrolling interests   (35,607 )   (33,301 )   (17,160 )   (18,038 )
Acquisition of noncontrolling interests   (4,600 )            
Proceeds from exercises of stock options, net of withholding taxes paid on restricted stock units   12,442     4,944     11,603     5,520  
Net cash provided by financing activities   508,463     436,058     312,946     224,055  
Net change in cash and restricted cash   49,468     28,613     43,933     27,075  
Cash and restricted cash, beginning of period   304,399     241,790     309,934     243,328  
Cash and restricted cash, end of period   $ 353,867     $ 270,403     $ 353,867     $ 270,403  

Key Operating Metrics and Financial Metrics

    Three Months Ended
June 30,
    2019     2018  
MW Deployed (during the period)     103       91  
Cumulative MW Deployed (end of period)     1,763       1,360  
Gross Earning Assets under Energy Contract (end of period)(in millions)   $ 2,252     $ 1,715  
Gross Earning Assets Value of Purchase or Renewal (end of period)(in millions)   $ 1,060     $ 863  
Gross Earning Assets (end of period)(in millions) (1)   $ 3,312     $ 2,578  
Net Earning Assets (end of period)(in millions) (1)(2)   $ 1,429     $ 1,290  


  Three Months Ended
June 30,
    2019     2018  
Project Value, Contracted Portion (per watt)   $ 4.04     $ 3.51  
Project Value, Renewal Portion (per watt)   $ 0.40     $ 0.59  
Total Project Value (per watt)   $ 4.44     $ 4.10  
Creation Cost (per watt)   $ 3.33     $ 3.12  
Unlevered NPV (per watt)(1)   $ 1.11     $ 0.98  
NPV (in millions)   $ 95     $ 77  


  1. Numbers may not sum due to rounding.
  2. Sunrun records income when it delivers tax benefits to its tax equity investors. Under partnership flip transactions this income is recognized beginning at the time of deployment. In pass-through financing transactions, income is recognized later, upon utility interconnection permission (PTO). Income recognition therefore lags in periods when the company is increasing its use of pass-through financing funds. Until PTO is received for a solar system in a pass-through financing obligation structure, the company records the expected value of tax benefits as a short term pass-through financing obligation, similar to deferred revenue accounting.  The amount reflected within short-term pass-through financing obligation was $36.2 million in the second quarter of 2018.  As such, the pass-through financing obligation used to calculate Net Earning Assets is reduced by $36.2 million. There was no amount reflected within short-term pass through financing in the second quarter of 2019.


Creation Cost includes (i) certain installation and general and administrative costs after subtracting the gross margin on solar energy systems and product sales divided by watts deployed during the measurement period and (ii) certain sales and marketing expenses under new Customer Agreements, net of cancellations during the period divided by the related watts deployed.

Customers refers to all residential homeowners (i) who have executed a Customer Agreement or cash sales agreement with us and (ii) for whom we have internal confirmation that the applicable solar energy system has reached notice to proceed or “NTP”, net of cancellations.

Customer Agreements refers to, collectively, solar power purchase agreements and solar leases.

Gross Earning Assets represent the remaining net cash flows (discounted at 6%) we expect to receive during the initial term of our Customer Agreements (typically 20 or 25 years) for systems that have been deployed as of the measurement date, plus a discounted estimate of the value of the Customer Agreement renewal term or solar energy system purchase at the end of the initial term. Gross Earning Assets deducts estimated cash distributions to investors in consolidated joint ventures and estimated operating, maintenance and administrative expenses for systems deployed as of the measurement date. In calculating Gross Earning Assets, we deduct estimated cash distributions to our project equity financing providers. In calculating Gross Earning Assets, we do not deduct customer payments we are obligated to pass through to investors in pass-through financing obligations as these amounts are reflected on our balance sheet as long-term and short-term pass-through financing obligations, similar to the way that debt obligations are presented. In determining our finance strategy, we use pass-through financing obligations and long-term debt in an equivalent fashion as the schedule of payments of distributions to pass-through financing investors is more similar to the payment of interest to lenders than the internal rates of return (IRRs) paid to investors in other tax equity structures. We calculate the Gross Earning Assets value of the purchase or renewal amount at the expiration of the initial contract term assuming either a system purchase or a five year renewal (for our 25-year Customer Agreements) or a 10-year renewal (for our 20-year Customer Agreements), in each case forecasting only a 30-year customer relationship (although the customer may renew for additional years, or purchase the system), at a contract rate equal to 90% of the customer’s contractual rate in effect at the end of the initial contract term. After the initial contract term, our Customer Agreements typically automatically renew on an annual basis and the rate is initially set at up to a 10% discount to then-prevailing power prices. Gross Earning Assets Under Energy Contract represents the remaining net cash flows during the initial term of our Customer Agreements (less substantially all value from SRECs prior to July 1, 2015), for systems deployed as of the measurement date.

Gross Earning Assets Under Energy Contract represents the remaining net cash flows during the initial term of our Customer Agreements (less substantially all value from SRECs prior to July 1, 2015), for systems deployed as of the measurement date.

Gross Earning Assets Value of Purchase or Renewal is the forecasted net present value we would receive upon or following the expiration of the initial Customer Agreement term (either in the form of cash payments during any applicable renewal period or a system purchase at the end of the initial term), for systems deployed as of the measurement date.

MW Deployed represents the aggregate megawatt production capacity of our solar energy systems, whether sold directly to customers or subject to executed Customer Agreements, for which we have (i) confirmation that the systems are installed on the roof, subject to final inspection or (ii) in the case of certain system installations by our partners, accrued at least 80% of the expected project cost.

Net Earning Assets represents Gross Earning Assets less both project level debt and pass-through financing obligations, as of the same measurement date. Because estimated cash distributions to our project equity financing partners are deducted from Gross Earning Assets, a proportional share of the corresponding project level debt is deducted from Net Earning Assets.

NPV equals Unlevered NPV multiplied by leased megawatts deployed in period.

NTP or Notice to Proceed refers to our internal confirmation that a solar energy system has met our installation requirements for size, equipment and design.

Project Value represents the value of upfront and future payments by customers, the benefits received from utility and state incentives, as well as the present value of net proceeds derived through investment funds. Specifically, Project Value is calculated as the sum of the following items (all measured on a per-watt basis with respect to megawatts deployed under Customer Agreements during the period): (i) estimated Gross Earning Assets, (ii) utility or upfront state incentives, (iii) upfront payments from customers for deposits and partial or full prepayments of amounts otherwise due under Customer Agreements and which are not already included in Gross Earning Assets and (iv) finance proceeds from tax equity investors, excluding cash true-up payments or the value of asset contributions in lieu of cash true-up payments made to investors. Project Value includes contracted SRECs for all periods after July 1, 2015.

Unlevered NPV equals the difference between Project Value and estimated Creation Cost on a per watt basis.

Investor & Analyst Contact:

Patrick Jobin
Vice President, Finance & Investor Relations
(415) 373-5206

Media Contact:

Georgia Dempsey
Director of Corporate Communications
(415) 518-9418



Source: Sunrun Inc.