Array Technologies CEO Jim Fusaro joins Yahoo Finance’s Zack Guzman to discuss the company’s public debut on the NASDAQ.
Video Transcript
ZACK GUZMAN: I want to highlight another one of those IPOs we have coming our way here. And solar panel tech company, Array Technologies, popping in its NASDAQ debut. The company selling 47.5 million shares at $22 each. Array is north of a billion dollars in the IPO.
And I want to talk more about it because it is interesting the growth that this company is posting, when we think about the opportunity in the solar space. And here to discuss that with us today is the CEO of Array Technologies. Jim Fusaro joins us now.
And Jim, I appreciate you taking the time to chat here, man. Congrats on the big debut in day one of trading. Talk to me about where this billion dollars that you guys raised in this IPO is going to be put to work to continue the growth you guys have posted.
JIM FUSARO: Well, thanks, Zack. First of all, it’s a real amazing day. Certainly proud of the team in getting us to where we are. They really delivered over the past few years. And we’re real excited about the future.
With respect to what we plan to do with the capital we raise, we’re going to continue to drive innovation in the solar tracking part of solar where we play. It’s not in the panel itself. We enable the panel to produce more energy.
We’re also going to use that to pay down debt. And having that permanent access to capital will certainly allow us to scale and grow with the overall market.
ZACK GUZMAN: I also want to bring in Yahoo Finance’s markets reporter here, Ines Ferre, and actually had a question for you as well.
INES FERRE: Yeah, Jim, we’ve seen a move towards electrification, electrification of EVs, charging stations that need solar energy. Can you talk to us a little bit about how electricity consumption is going to impact the solar energy market and trackers, which is what you all manufacture?
JIM FUSARO: Ines, that’s a great question. There’s a number of megatrends that are driving utility scale solar. And you just named one of them, the electrification. But you also have corporate America and corporations throughout the globe that are focused on 100% renewable by 2030, in some cases.
You also have the state mandates, and you also have that electrification that you spoke of, and globally with decarbonization. But what’s really fueling the growth here is utility scale solar, in many cases, is at cost parity with new natural gas generation. So that’s what we’re real excited about.
ZACK GUZMAN: The other thing, too, I mean, we’ve been talking about demand for shares in companies that are profitable. You guys are profitable, and you guys’ revenue over 2018 to 2019 more than doubled. Similar story here in what you’ve reported so far in 2020.
Talk to me about the tradeoff between staying with profitability here and trying to grow quickly as you kind of jump to capitalize on the opportunity we were just describing.
JIM FUSARO: Well, let me talk about the value that’s really fueling that growth. And the value comes with what we do to a panel, as if it was mounted in a permanent, fixed position. That’s often referred to as fixed tilt.
So what we do is we keep that panel at a tangent to the sun throughout the day, and we have software that we’ve developed that uses machine learning algorithms to continue to increase the output, for example, on a cloudy day, where the panel may not be at a perfect tangent to the sun, but rather, perhaps pointing straight up.
We also design these products to last more than 25 years. So every component goes through rigorous evaluations and high stress reliability, and also wind. Wind is another significant factor, and it’s a common occurrence across the globe. And we have patented technology that mitigates that and protects that. So that’s the value that we bring. And that’s what’s really fueling a lot of our growth here domestically, as well as internationally.
INES FERRE: Can you also talk about that international market? Because I was going through your S-1 filing, talking about the international market. They don’t use trackers as much as solar projects here in the US. So what kind of opportunities do you see for expanding internationally? And how do you plan to compete with others in the market?
JIM FUSARO: Great question. If you look at tracker technology, it’s a US invention. It’s US technology. And it was actually our founder, Ron Corio, that pioneered this industry and developed this– the technology that we have today. And we continue to innovate around that and grow it.
If you look internationally, one might think that they’re roughly about three to five years behind where the US. The US has roughly 75% or so of share of demand with respect to all ground mail systems. That trend is now happening globally. And the customers that we work with, our marquee customers, have that global presence. And they certainly see that value.
ZACK GUZMAN: Yeah, you note working with customers that it’s a little bit centrified in a few that present a large chunk of your sales here– a potential risk depending on what happens with them, but a potential strength depending on the way you look at it. So talk to me about how the technology is rolled out and what partnerships here you’re going to be leading on to drive the growth that you’ve posted so far.
JIM FUSARO: So first, I’ll talk about the customer mix, and then I’ll talk about how that value proposition works. So what the independent power producers and developers and utilities do, they use the EPCs, known as the Engineering Procurement and Construction firms.
So if I have one customer that’s in the EPC, that’s one that serves many. So they’re actually doing the construction and the maintenance of said project. So that’s an important key takeaway. So you’ll see that mix of customers change.
When it comes to the value and how we sell, we’re working with our customers, whether it’s the actual long-term asset owner or the engineering firm that we contract with. For over, like, 12 to 18 months, we design that project. We work with them on the logistics. We source accordingly. So it’s a very involved, very detailed value proposition that we work with what’s our customers.
