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Sunnova Energy International said it may not be able to continue as a "going concern" in a year because of financial difficulties.
The solar power company has been plagued by falling demand for its alternative energy products.
Sunnova shares lost nearly two-thirds of their value, sinking to their all-time low.
Sunnova Energy International (NOVA) shares tanked more than 60% to trade at an all-time low Monday when the solar power company warned it might not be able to stay in business as demand for its alternative energy products sank.
The company said that without additional funding, its "unrestricted cash, cash flows from operating activities and availability and commitments under existing financing agreements are not sufficient to meet obligations and fund operations for a period of at least one year from the date we issue our consolidated financial statements" for the year ending Dec. 31.
Because of that, Sunnova believes "substantial doubt exists regarding our ability to continue as a going concern" 12 months after making the upcoming filing with regulators.
The company noted that for fiscal 2024, solar energy system and product sales revenue decreased by 13% year-over-year to $298.4 million, mainly due to decreases in inventory sales revenue. Operating expenses rose 12% to $1.08 billion.
Founder and CEO William "John" Berger explained that during 2024 and the first two months of this year, Sunnova took steps to address its financial condition, "including mandating domestic content for our dealers to increase our weighted average ITC percentage, raising price, simplifying our business to reduce costs, and changing dealer payment terms to align with our own funding sources." ITC, or Investment Tax Credit, refers to federal tax breaks given to homeowners and businesses that purchase solar energy systems.
Sunnova also announced it has signed a three-year term loan agreement with several lenders for $185 million, which will have the company pay 15% in interest per year.
Shares of Sunnova Energy International lost nearly two-thirds of their value on the news.
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