NEW YORK - Daqo New Energy Corp. (NYSE:DQ) reported narrower-than-expected losses for the third quarter of 2024, sending shares up 2% in premarket trading on Wednesday.
The Chinese polysilicon manufacturer posted an adjusted loss of $0.59 per American Depositary Share (ADS), beating analyst estimates for a loss of $0.70 per ADS. Revenue came in at $198.5 million, falling short of expectations for $271.62 million.
While still reporting a loss, Daqo's results showed improvement from the second quarter's adjusted loss of $1.50 per ADS. The company attributed the narrowing losses to lower inventory write-downs compared to Q2.
"Entering the third quarter, China solar industry's market conditions remained challenging, exacerbated by the overall over-supply in the industry," said CEO Xiang Xu. "Market selling prices continued to be below production costs for the majority of industry players throughout the entire value-chain."
Daqo reduced its production utilization rate to 50% during Q3 due to weak demand, producing 43,592 metric tons of polysilicon compared to 64,961 metric tons in Q2. The company lowered its cash production costs to $5.34/kg from $5.39/kg in Q2.
For Q4 2024, Daqo expects polysilicon production of 31,000 to 34,000 metric tons. The company narrowed its full-year 2024 production guidance to 200,000-210,000 metric tons.
Despite ongoing industry challenges, Daqo maintained a strong balance sheet with $853.4 million in cash and no debt as of September 30.
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