Renewable energy solutions provider Canadian Solar’s revenue for the second quarter (Q2) of 2026 declined 29% year-over-year (YoY) to $1.21 billion compared to $1.69 billion.

The revenue beat analysts’ expectations by $71.94 million.

The company attributed the revenue drop to lower solar module and project sales.

The company’s solar module sales revenue declined 42.3% YoY to $589.4 million from $1.02 billion. Revenue from battery energy storage solutions declined 1.5% to $425.9 million from $432.4 million.

During the quarter, the company shipped 3.1 GW of solar modules, up 25% quarter-over-quarter (QoQ) but down 60% YoY.

It reported a net loss of $77 million in Q2 2026, compared with a net income of $7.2 million in the corresponding quarter last year.

The company said elevated freight costs from ongoing geopolitical uncertainties impacted its profitability.

It also attributed the loss to ramp-up costs for its solar cell manufacturing facility in Jeffersonville, which is expected to normalize as it finishes ramping up Phase 1 of its solar cell plant to 2.1 GW. It plans to expand the facility’s nameplate capacity to 6.3 GW in 2027.

Loss per share was $1.4 in Q2 2026, compared with a loss per share of $0.08 in Q2 2025, beating analysts’ expectations by $0.22.

1H Results

For the first half (1H) of 2026, Canadian Solar reported revenue of $2.29 billion, down 20.9% YoY compared with $2.89 billion.

The company’s net loss widened to $108.9 million compared to $26.77 million in the same period last year.

Loss per share stood at $2.11, compared with a loss per share of $0.77 in 1H 2025.

Business Highlights

Battery energy storage shipments reached 3.7 GWh, increasing 82% QoQ and 73% YoY.

As of June 30, 2026, Canadian Solar had a solar project development pipeline of 21.67 GW, comprising 1.72 GW under construction, 2.21 GW in backlog, 2.23 GW in advanced development, and 15.51 GW in early stage development.

The company’s battery energy storage project development pipeline stood at 84.06 GWh, comprising 600 MWh under construction, 4.38 GWh in backlog, 7.84 GWh in advanced development, and 71.24 GWh in early stage development.

Its operations and maintenance platform had 15 GW of contracted projects.

As of June 30, 2026, e-STORAGE’s contracted backlog, including contracted long-term service agreements, stood at $3.5 billion. The long-term service agreements cover 34 GWh of contracted projects.

Canadian Solar operates a 5 GW solar module manufacturing facility in Mesquite, Texas, which is being expanded to a nameplate capacity of 10 GW. The expansion is expected to be completed in the second half of 2026.

Colin Parkin, CEO, said demand from data centers is moving from discussions to contracted opportunities. Earlier this year, e-STORAGE secured a contract with a major U.S. utility for a 500 MW/2.5 GWh DC battery storage project designed to support data center grid infrastructure and resiliency.

CS PowerTech has secured more than 13 GW of contracted backlog for domestically manufactured HJT and TOPCon N-type bifacial modules, with deliveries scheduled through 2029. The contracts represent more than $4.5 billion in value.

In June, Canadian Solar’s e-STORAGE signed a contract with an electric utility in Florida to supply a 95 MW/426 MWh battery energy storage system. It also secured a contract to supply a 75 MW/381 MWh battery storage system to Apex Clean Energy in Michigan.

In August, the company’s Recurrent Energy subsidiary secured $695 million in project financing and tax equity for its 330 MW Cobalt Solar project in California. The financing comprises approximately $484 million in debt and a $211 million tax equity investment.

The company expects capital expenditure of approximately $1.3 billion in 2026 as it scales up solar module and cell production and expands energy storage capacity.

Q3 Outlook

Canadian Solar expects revenue to range between $1.3 billion and $1.5 billion in the third quarter of 2026, with gross margin expected to range from 13.5% to 15.5%.

Solar module shipments recognized as revenue are expected to range from 3.5 GW to 3.8 GW, while battery energy storage shipments are expected to range from 3.4 GWh to 3.8 GWh.

The company reiterated its 2026 guidance for shipments of 6.5 GW to 7 GW of solar modules and 4.5 GWh to 5.5 GWh of battery energy storage solutions in the U.S. market.

Parkin said U.S. solar and storage shipments are expected to accelerate during the second half of 2026, with each remaining quarter delivering higher volumes than the previous quarter.

Across the utility, C&I, and residential segments, the company is increasing module efficiency from 23.2% to 24.4% while reducing silver consumption from 6.5 mg/W to 3 mg/W to lower input costs.

By 2028, it expects to begin mass production of its premium TOPCon back-contact architecture, primarily for residential applications. These modules are expected to achieve 24.8%-25.2% efficiency while reducing silver consumption to 1-2 mg/W.

Parkin said that Section 232 on polysilicon is only a few weeks old, but the market is already adjusting. He added that Canadian Solar expect accelerated deliveries in the second half of the year ahead of the December 4 implementation, creating a near-term rush that is pushing up demand and prices.

In Q1 of 2026, Canadian Solar’s revenue declined 10% YoY to $1.08 billion from $1.20 billion.