Renewable energy solutions provider Canadian Solar’s revenue for the first quarter (Q1) of 2026 declined 10% year-over-year (YoY) to $1.08 billion from $1.20 billion.

The company attributed the revenue drop to lower solar module sales, which were partially offset by higher battery energy storage sales.

Higher operating expenses, foreign exchange losses, and tax expense accruals related to tariff refunds also impacted profitability in the quarter.

Revenue from solar module manufacturing during the quarter was $455.1 million, down 42.9% YoY from $797.4 million. The battery storage segment generated revenue of $382.8 million, a 146.4% YoY jump from $155.3 million.

During the quarter, it shipped 2.5 GW of solar modules to more than 60 countries, a 64% YoY drop, while its battery storage shipments jumped 142% YoY to 2.1 GWh.

Its net loss narrowed by 5.9% YoY to $32 million from $34 million.

Earnings per share (EPS) came in at a loss of $0.71, compared with $0.69 in the corresponding quarter last year.

Canadian Solar’s revenue declined 10% YoY in the previous quarter.

Business Highlights

As of March 31, 2026, Canadian Solar has a solar project pipeline of 23,718 MW. It comprises 1,772 MW of solar projects under construction, 2,634 MW under backlog, and 2,485 MW under advanced stages of development. It also includes 16,827 MW of projects under the early stages of development.

The company has a pipeline of 80,643 MWh of battery storage projects as of March 31, 2026. The pipeline comprises 1,800 MWh of battery storage projects under construction, 3,170 MWh under backlog, and 9,126 MWh under advanced stages of development. It includes 66,547 MWh of projects in the early stages of development.

In March 2026, the company announced an order to deliver 420 MWh of battery storage systems for UK-based renewable energy company Drax Group.

The O&M platform stands at 15 GW, of which 11.2 GW are already operational.

As of May 8, the company’s contracted backlog totalled $3.5 billion, including 34 GWh of operating projects under long-term service agreements.

Canadian Solar has secured interconnections for 7 GW of solar and 14 GWh of storage globally, excluding projects already in operation.

In December 2025, Canadian Solar formed a new joint venture with its subsidiary, CSI Solar, by holding a 75.1% stake in CS PowerTech, which operates U.S.-based manufacturing and sales of solar modules, solar cells, and advanced energy storage systems. The joint venture will allow the company to reshore its domestic manufacturing capability in the U.S.

The company’s 5 GW solar module manufacturing factory in Mesquite, Texas, is expected to expand its nameplate capacity to 10 GW by the second half of 2026. It is expanding the production capacity of its heterojunction technology (HJT) solar cell manufacturing facility in Jeffersonville, Indiana, to 6.3 GW. It plans to add additional cell production lines through 2026.

The company expects HJT products to command a 10% to 15% price premium over TOPCon products.

Under Phase I, Canadian Solar began trial production at its HJT solar cell manufacturing facility in April 2026 with a nameplate capacity of 2.1 GW. Under Phase II, it plans to add 4.2 GW of cell line capacity. Its domestic manufacturing accounts for 30-40% of total solar cell production.

Canadian Solar said it is expanding capacity at its integrated battery storage and cell factory in Southeast Asia. It also plans to double its battery cell and SolBank capacities. The new production lines are currently under construction and are expected to come online in the first half of 2027.

Q2 Outlook

The company expects total revenue to be between $1 billion and $1.2 billion in Q2 2026. Total module shipments recognized as revenue are expected to range from 3.1 GW to 3.3 GW. Total battery energy storage shipments in Q2 2026 are expected to range from 2.8 GWh to 3.2 GWh. It includes 400 MWh of battery storage projects under execution.

Canadian Solar reiterated its guidance for 6.5-7 GW of solar modules and 4.5-5.5 GWh of battery energy storage solutions in the U.S. market for 2026.

Colin Parkin, CEO at Canadian Solar, said that the first half of the year reflects prevailing market challenges, with solar margins remaining under pressure. He added that margins are normalizing in its energy storage business, while margins remain partially exposed to fluctuations in lithium carbonate prices.

Parkin said that the company’s internal production of lithium-ion phosphate prismatic cells has achieved a cost basis below the market price of third-party cells.

He said that Canadian Solar is actively pursuing opportunities within both front-of-the-meter and behind-the-meter data center applications.

The company said the pre-lithium technology is ready, but adoption depends on cost-benefit considerations because it increases battery costs. It is also researching sodium-ion battery technology, which will allow it to reduce annual thermal management electricity costs by 2% and insulate it from raw material fluctuations.

In April 2026, the Patent Trial and Appeal Board of the U.S. Patent and Trademark Office invalidated all claims by Trina Solar on two TOPCon solar cell patents against certain subsidiaries of Canadian Solar.