The gathering price pressures that have become a theme of the solar inverter sector in recent years rounded on U.S. microinverter specialist Enphase in 2015, with the California-based company posting an annual net loss of $22.1 million for the year, following a profitable 2014.

Despite shipping a record 706 MW of microinverters for the year, and posting total revenue of $357.2 million for 2015  up from 2014s $343.9 million  Enphase still saw its gross margin contract due to higher operating costs and reduced average selling prices (ASPs) for its microinverters and other components: in November last year the company made the decision to reduce by 19% the price of its microinverter in order to alleviate weak sales growth.

Analysts IHS recently predicted that inverter prices are set to fall a further 10% this year as the sector continues to streamline and exert downward pressure on costs, and thus Enphase was eager to reduce its operating expenses  something it managed in the second half of the year, said company CFO Kris Sennesael.

"Revenue for the fourth quarter of 2015 was impacted by the reduction of inventory levels in our channel, which have now returned to normalized levels," Sennesael said.

GAAP operating expenses for the fourth quarter were $30.9 million, and GAAP operating loss reached $15.2 million. For the quarter, GAAP net loss was $15.8 million, which  adjusted for one-time gains and costs  represented a loss of $0.25 per share.

Enphases financial results were thus lower than expected, particularly in Q4 where revenue of $65.6 million was below Zacks expectation of $66.3 million.

However, having surpassed the 10 million mark for microinverters shipped, and exited the year with a total cash balance of $28.5 million, Enphase CEO and president Paul Nahi is confident that 2016 will deliver the turnaround the company has been building toward.

"2015 was a challenging year for Enphase," Nahi admitted. "However, we continued to grow our revenue and MW shipped on a year-over-year basis, further driving the global adoption of the microinverter technology in our key markets. As we move into 2016, we continue to aggressively drive down the overall cost of our microinverter system, and are pleased with several recent customer wins that will contribute to market share growth."

Enphase has already begun shipping its 5th generation microinverter and will seek to grow sales of its Home Energy Solution in 2016  which comprises an AC battery storage system, AC module and AC combiner box.

For Q1 2016, the company expects revenue to be within the range of $63 million to $69 million, and operating expenses to fall further, to somewhere between $27 million and $29 million.

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