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JKS
Earnings call · Jun 2026 (Q2 FY26)

JinkoSolar Holding Co. Q2 FY26 earnings call JKS

Aug 26, 2026 Source

Executive summary

JinkoSolar Q2 FY26 — Profitability Pressures Amidst Market Shifts and Strategic Investments

The second quarter saw JinkoSolar navigate a challenging PV market with sequential margin compression and an expanded net loss, despite sequential growth in module shipments and strong ESS performance. The company is strategically optimizing its product and geographic mix, focusing on high-efficiency products like TOPCon 3.0, and leveraging its investment portfolio for long-term value creation, while adjusting full-year shipment guidance to prioritize profitability and cash flow over scale.

Highlights

5

  • Module shipments increased sequentially to approximately 16 GW in Q2 FY26.

  • ESS shipments in H1 FY26 were 3.1 GWh, significantly up year-over-year, with over 1 GWh recognized in Q2 FY26.

  • TOPCon 3.0 series continued to command a premium of approximately $0.01 per watt.

  • Investment portfolio generated cumulative value appreciation of approximately RMB 880 million.

  • Gross margin improved year-over-year to 4.2% in Q2 FY26 (from 2.9% in Q2 FY25).

Concerns

5

  • Gross margin decreased sequentially to 4.2% in Q2 FY26 (from 8.3% in Q1 FY26) due to lower ASP and high-efficiency product ramp-up costs.

  • Net loss expanded sequentially in Q2 FY26.

  • Full-year 2026 module shipment guidance adjusted down to between 60 GW and 70 GW.

  • Operating expenses increased 21% sequentially to $287 million in Q2 FY26, mainly due to higher expected credit losses.

  • Net debt increased to $4.1 billion at the end of Q2 FY26 (from $3.5 billion at the end of Q1 FY26).

Guidance & targets

CategoryTargetConfidence
Annual integrated production capacity
approximately 100 gigawatts
medium materiality
High
TOPCon 3.0 production capacity
140 gigawatts
medium materiality
High
Full-year 2026 module shipments
between 60 gigawatts and 70 gigawatts
high materiality
High
Full-year 2026 high-efficiency products share of module shipments
over 60%
medium materiality
High
Q3 2026 module shipments
between 15 gigawatts and 17 gigawatts
high materiality
High
Full-year 2026 energy storage system shipments
more than double year-over-year
medium materiality
High
Full-year 2026 operating cash flow
improve compared to '25
medium materiality
High
Q3 ASP
go up a little bit
medium materiality
High
Q3 Gross Margin
moderate improvement
high materiality
High
Global market size
around 600 gigawatts or slightly below
medium materiality
Medium
Global market size
roughly 600 to 650 gigawatts
medium materiality
Medium
Next 2 years CapEx
very, very small, minimum and minor upgrades
medium materiality
High
Q3/Q4 2026 ESS revenue recognition
maybe 3 to 4 gigawatt hours a quarter
medium materiality
Medium

Product announcements

ProductTypeDetails
TOPCon Tiger Neo 5.0 moduleslaunch
Sunny 365 smart solar story systemlaunch

Deals & partnerships

LAPLACE Renewable Energy Technology Company Limited Divested a substantial portion of equity interest. over RMB 300 million

Divested a substantial portion of equity interest during the first half of 2026. Cumulative realized gain on visible disposal exceeded RMB 250 million since initial investment, recognized through fair value adjustments following its IPO in late 2024.

Hangzhou Gold Electronic Equipment Company Limited Successfully completed its listing on ChiNext Market of Shenzhen Stock Exchange.

Listing on ChiNext Market during the second quarter of 2026.

FH Capital Sale of US assets to FH Capital.

Jinko divested its manufacturing assets in the United States to FH Capital, becoming a financial minority investor in the JV.

Risks & headwinds

Supply and demand imbalances across PV industry Q2 FY26

Prices across the supply chain and industry profitability remaining under pressure.

Mitigation:Optimized order book and geographic mix, rationally managed utilization rates, expanded proportion of high-efficiency products.

Shift in domestic and overseas policies Q2 FY26

Further compounded pressures on profitability.

Mitigation:Focusing on high-efficiency products that meet new standards (e.g., Level 1 energy efficiency by Jan 2027).

Cost of ramping up high-efficiency products Q2 FY26

Remained elevated during the quarter, contributing to decreased gross margin.

Mitigation:Introducing technologies that lower cost; expected cost reduction in Q3 with full operational status.

Lower average selling price (ASP) of solar modules Q2 FY26

Main reason for sequential decrease in gross margin.

Mitigation:Optimizing product mix towards premium products (TOPCon 3.0) and expecting ASP to go up in Q3.

Higher expected credit losses Q2 FY26

Main reason for 21% sequential increase in total operating expenses to $287 million.

Mitigation:Management clarified it's an accounting prospective based on aging, not actual deteriorated credit; focus on healthy operating cash flow.

Competition from Tier 2/3 players ongoing

Playing low-price strategy, sacrificing quality to attack the market.

Mitigation:Jinko prioritizes long-term reputation and quality, giving up some low-priced deals to protect its own interest.

Trade barriers and policy restrictions in key markets ongoing

Certain sizable markets (US, Europe, India) introducing more strict barriers, making them less easy to access.

Mitigation:Optimizing geographic mix, focusing on high-value markets, and pursuing JV structures for local manufacturing.

Section 232 tariffs in the US near-term

Expected to increase the cost of solar modules in the US.

Mitigation:Believes the market can absorb the potential cost increase; US JV will continue to participate in the market.

What to watch in Q3 FY26

Module ASP and Gross Margin recovery

Q3 FY26
Current Q2 ASP declined, Q2 GM 4.2% (down from 8.3% QoQ)
Target ASP up, moderate GM improvement

Why it matters

Indicates the effectiveness of the company's strategy to prioritize profitability and product mix optimization in a challenging market.

So yes, for the ASP side, we expect, firstly, apple-to-apple, we are expecting the price goes up a little bit in Q3. And if we look into the average prices, it will go up as well. [...] Yes, we did expect gross margin moderate improvement in the third quarter.

Q&A highlights

How are ASPs trending in Q3, and what impact will increased Tiger Neo 3.0 shipments have?

Management expects apple-to-apple ASPs to increase in Q3 due to current market conditions and a higher proportion of premium Tiger Neo 3.0 products in the mix, which will also lift average prices.

“So yes, for the ASP side, we expect, firstly, apple-to-apple, we are expecting the price goes up a little bit in Q3. And if we look into the average prices, it will go up as well. Firstly, the first reason is to be course from the current market situation as the price is going up because of different reasons, but ball market goes up. So most of the DG prices are following the spot market. So we are expecting the price of Q2 goes up. The second reason is because the mix of different products. Our 3.0 product, which is a premium product ratio in Q3 will be definitely higher than Q2, which will be helpful to lease up the ASP in Q3 as well.”

asked by Tyler Bisset · answered by Unknown Executive (Executives)

3 min read 6 chapters

Detailed narrative

Market Dynamics and Profitability Pressures

The PV industry is experiencing dynamic supply and demand imbalances, compounded by shifts in domestic and overseas policies, leading to continued price pressure across the supply chain. This resulted in a sequential decrease in gross margin to 4.2% in Q2 FY26 from 8.3% in Q1 FY26, and an expanded net loss. The company is responding by optimizing its order book and geographic mix, rationally managing utilization rates, and increasing the proportion of high-efficiency products to drive profitability recovery.

Shift to High-Efficiency Products and New Standards

JinkoSolar is strategically shifting its competitive focus from capacity and shipment scale to effective supply, product value, and earnings quality. A new national standard on energy efficiency for modules and inverters, effective January 2027, will mandate Level 1 energy efficiency for market access. JinkoSolar expects its 140 GW TOPCon 3.0 production capacity by year-end 2026 to meet these requirements, strengthening its position for large-scale renewable energy project tenders. The company also unveiled its new TOPCon Tiger Neo 5.0 modules with 25.91% efficiency and over 700 watts power output.

Strategic Investments and Portfolio Value

Leveraging its industry expertise, JinkoSolar has built a strategic investment portfolio of over 40 companies, primarily in the solar and storage value chain, and recently expanded into the AI ecosystem. The company has invested approximately RMB 1.86 billion in cash, with the remaining portfolio having an original cost of RMB 1.5 billion and a fair value of RMB 1.99 billion as of June 30, 2026. This portfolio has generated cumulative value appreciation of RMB 880 million, including RMB 490 million in gains during H1 FY26, demonstrating a complementary driver for long-term value creation.

Energy Storage Business Growth and Strategy

The Energy Storage System (ESS) business is a key growth area, with shipments reaching 3.1 GWh in H1 FY26, a significant year-over-year increase. Over 1 GWh of ESS revenue was recognized in Q2 FY26 as project deliveries increased. JinkoSolar is enhancing its in-house PCS and EMS capabilities and aims to boost both revenue recognition and profit realization. The company expects full-year 2026 ESS shipments to more than double year-over-year, focusing on high-value markets and integrated PV storage solutions like the new Sunny 365 smart solar story system.

Global Market Optimization and Trade Barriers

JinkoSolar is actively optimizing its geographic and customer mix, with overseas markets accounting for over 70% of H1 FY26 shipments, particularly in Asia Pacific, Europe, and emerging markets. The company is reducing exposure to highly competitive markets like China, where demand is 30-40% lower than last year, and prioritizing premium markets. Trade barriers and policy restrictions in regions like the US, Europe, and India are making certain markets less accessible, influencing the company's market share strategy.

US Section 232 Tariffs and Market Outlook

The company views the Section 232 tariffs in the US as anticipated, though the 15% tariff rate was higher than expected. This policy is expected to increase the cost of solar modules in the US. Despite the cost increase, management believes most US solar projects will continue, and their US joint venture (where JinkoSolar is a minority investor) will continue to participate in the market. The company also noted that the tariff rebate program is likely targeting new wafer, cell, and polysilicon capacity, not module manufacturing.

AI-generated summary of the company's earnings call. Not investment advice.