First Solar, Inc.

Good afternoon, everyone, and welcome to First Solar's fourth quarter and full year 2022 earnings call. This call is being webcast live on the investor section of First Solar's website at investors.firstsolar.com. At this time, all participants are in a listen-only mode. As a reminder, today's call is being recorded. I would now like to turn the call over to Richard Romero from First Solar Investor Relations. Richard, you may begin.

Thank you. Good afternoon, everyone, and thank you for joining us. Today, the company issued a press release announcing its fourth quarter and full year 2022 financial results, as well as its guidance for 2023. A copy of the press release and associated presentation are available on First Solar's website at investor.firstsolar.com. With me today are Mark Widmar, Chief Executive Officer, and Alex Bradley, Chief Financial Officer. Mark will begin by providing a business update. Alex will then discuss our financial results for the fourth quarter and full year 2022. Following these remarks, Mark will provide a business and strategy outlook. Alex will then discuss our financial guidance for 2023. Following their remarks, we will open the call for questions. Please note this call will include forward-looking statements that involve risks and uncertainties, including risks and uncertainties related to the Inflation Reduction Act of 2022 that could cause actual results to differ materially from management's current expectations. We encourage you to review the Safe Harbor Statements contained in today's press release and presentation for more complete description. It is now my pleasure to introduce Mark Widmar, Chief Executive Officer.

Thank you, Richard. Good afternoon and thank you for joining us today. We began 2022 with the expectation that it would be challenging from an earnings perspective as we face unprecedented logistics and commodity costs. We also expected it to be a year of transition, setting the stage for growth and profitability into 2023 and beyond. We entered this year in a significantly stronger commercial, operational, and financial position with increased R&D investment, new domestic and international capacity coming online, and a new Series 7 product. We also began the year with a record contracted backlog, a significant pipeline of bookings opportunity, and a robust demand in our core markets. This momentum is driven by our points of differentiation, including the unique CAD sale technology, vertically integrated manufacturing process, domestic production, a strong balance sheet, and commitment to responsible solar, placing us in a position to respond to emerging opportunities, particularly those enabled by the rapidly evolving policy environment. This momentum is also due to the hard work, commitment, and passion of our associates. Moving on to slide three, I will highlight some of our key 2022 accomplishments. From a commercial perspective, in 2022, we saw a precipice shift towards long-term multi-year module procurement. This record volume of multi-gigawatt deals spanning multiple years was driven by a combination of competitive pricing, competitive technology, agile contracting, shared values, and trust in our ability to deliver the certainty that our customers are looking for. As a result, we had an excellent year from a bookings perspective, securing a record 48.3 gigawatts of net bookings in 2022, This was an increase of 30.8 gigawatts from our prior annual record of 17.5 gigawatts set in 2021. Our total backlog of future deliveries as of today's earning call now stands at a record 67.7 gigawatts. Financially, while Alex will provide a more comprehensive overview of our 2022 financial results, our full year EPS results came in towards the high end of the guidance range we provided at the time of our third quarter earnings call. We ended the year with gross cash of $2.6 billion, or $2.4 billion net of debt, which is an increase to gross and net cash of $800 million versus the prior year. This puts us in a position of strength to expand our capacity, invest in research and development, and technology improvements, and pursue our strategic opportunities. From a manufacturing perspective, we produced a record 9.1 gigawatts in 2022. Additionally, at the start of 2023, we achieved a significant milestone, producing our 50th gigawatts since commercial production began in 2002. Average watts per module produced in 2022 increased to 462 watts, an increase of 14 watts, and we increased our top production bin from 465 watts in 2021 to 475 watts in 2022. We exited 2022 with 9.8 gigawatts of main plate manufacturing capacity, and last month commenced initial production at our next generation Series 7 factory in Ohio, which will continue to ramp through 2023. We are also on track to complete the construction and commence the ramp of our Series 7 factory in India during 2023. Furthering our manufacturing expansion program, in 2022, we announced a new 3.5 gigawatt Series 7 factory in Alabama and a .9 gigawatt increase to nameplate capacity at our Ohio factories. By 2026, we expect U.S. nameplate capacity of approximately 10.7 gigawatts and global nameplate capacity of approximately 21.4 gigawatts. We also announced in 2022 an additional investment in a dedicated 270 million research and development facility to be located near our existing Perrysburg manufacturing plant in Ohio. We expect that this investment will improve cycles of learning and innovation and reduce downtime on our commercial production lines, while allowing us to produce full-size prototypes of both thin film and tandem PV modules. Strategically, We were able to largely exit our legacy systems business in 2022, which enables us to focus on our greatest technology and competitive advantages. Alex will discuss potential remaining legacy costs and opportunities related to this business when he provides guidance later in the call. Looking forward, we continue to evaluate the opportunities for further investments in incremental manufacturing capacity, including both greenfield expansion and throughput optimization at our currently planned capacity. This evaluation will require, among other things, an understanding of the anticipated IRS and Treasury IRA guidelines, including the respect to domestic content, as well as confidence in the presence of robust supply chain that supports our expansion objectives. Therefore, no expansion decisions have been made at this time. Turning to slide four, I'll next discuss our most recent shipments and bookings in greater detail. We shipped approximately 2.3 gigawatts and 9.3 gigawatts for the fourth quarter and full year 2022 respectively, which was within the guidance range that we provided during the third quarter earnings call. As a reminder, we generally define shipment as when the delivery process to a customer commences, whereas revenue recognition, or volume sold, occurs at a transfer of control of the modules to the customer, which is commonly upon arrival at the destination port or project site. With regards to bookings, we have sustained our recent momentum with 12 gigawatts of net booking since the third quarter earnings call and an average base ASP of 30.8 cents per watt. As previously noted, we are seeing a perceptible shift in procurement behavior as evidenced by the volume of multi-year, multi-gigawatt orders placed by our customers. Since the beginning of 2022, large developers such as Intersect Power Light Horse BP, National Grid, Eregis Energy, Savion, Silicon Ranch, and Swift Current, among others, have placed orders for at least two gigawatts. The fact that many of these transactions are with repeat buyers is an indication of the trust and shared values that underpin our customer relations and is a clear differentiator from the more transactional approach taken by many of our competitors. After accounting for shipments of approximately 2.3 gigawatts during the fourth quarter, our future expected shipments, which now extend into 2029, are 67.7 gigawatts. Excluding India and including our year-to-date bookings, we are sold out through 2025. We have in recent months pivoted from negotiating solely for 2026 selling to work with customers who are looking to secure multi-year contracts over the remainder of the decade. As a result of this commercial shift, we have not, as previously expected, as of the third quarter earnings call, fully sold out of our non-India production in 2026. We have sold more volume than previously expected for deliveries in 2027 and beyond. In total, we now have 25.5 gigawatts of planned deliveries in 2026 and beyond, an increase of 12.3 gigawatts from our prior earnings call. And now I'll turn the call over to Alex, who will discuss our Q4 and full year 2022 results.