First Solar (NASDAQ: FSLR) is making cuts in its profit forecast for 2011 and 2012.
According to Reuters, the company has revised its previous net sales forecast from between $3.0 billion and $3.3 billion to between $2.8 billion and $2.9 billion.
Earnings per share are now expected between $5.75 and $6.00.
Analysts, however, were even more surprised by the numbers for 2012. Thomson Reuters analysts estimated an average of $7.50 per share for 2012, with a range of $5.00 to $10.00.
First Solar, however, foresees nowhere near this much. The company expects between $3.75 and $4.25 per share for 2012, with net sales totaling between $3.7 and $4.0 billion.
The company was once the strongest player in the solar industry. Now, the falling costs in the industry are starting to affect it just as they affected companies like Solyndra which filed for bankruptcy in December.
CNN reported that a big reason for the low estimates was delays in some projects. But as current CEO Mike Ahearn told CNN, the company is hopeful:
“Our diverse business model and robust project pipeline will help First Solar generate a significant amount of cash in 2012 while improving operational efficiencies.”
He also told Reuters that while factories in 2012 will be run at 80%, focus would fall on utility-sized projects.
First Solar had already cut estimates once earlier this fall. In October, the cuts came with the release of Rob Gillette, former CEO of First Solar.
Reuters reports that falling government incentives play a big role in the industry losses. This has occurred mostly in Europe, but it’s also increasing all over the United States.
Solar companies are focusing harder on finding investors who will support the projects without loan guarantees from the government.
So far, some have been successful, but whether or not this holds out remains to be seen.
First Solar was down 20.13% on Wednesday to $34.00.
That’s all for now,