Pineapple Energy Inc. (NASDAQ:PEGY) Q4 2022 Earnings Call Transcript

Kyle Udseth: Not necessarily. I think that it’s €“ there’s still a decent amount of variability in it, right. And we gave a $5 million range, not a $1 million range. So I think that a lot of the year is still unwritten, but as we talked about with the backlog already, those are signed up contracts and we know what those are and kind of probability weighted the likelihood of them installing. So we’ve got good line of sight into a good proportion of it and then we know how selling is going in Q1 as well. I think that none of the individual kind of components is out of, like, above and beyond different than what we’ve seen before, right? I think it’s just kind of a combination of solid, consistent up into the right performance where the markets continue to grow through strong top of funnel demand, our ability to generate leads and close sales and win ours or better than our fair share just through our go-to-market approach, our brand building, our customer experience, our consultative approach keeps serving us well.

Hawaii battery attach rates are really strong and are going to continue that way, continuing improvement in battery attach rates in New York. And then on the selling price side of it, I’d say that that’s probably the lever we’ve paid the least amount of attention to in kind of that analytical comprehensive way so far. I think the operating businesses have had a way of pricing that’s worked well for them in the past and balanced profitability with volume growth and taking care of customers and just feeling good about the value proper offering. I think that as electric rates keep rising and financing costs keep rising, monthly payment to the customer probably goes up, but does so in a way that still creates value versus the alternative of not having solar, and exactly what we do in terms of pricing in there and how we take a few more basis points out of it.

Yes, I think there’s probably some upside there, but I’d say we’re more focused on just taking care of customers and helping more people go solar as rates keep rising. So from a modeling standpoint, I wouldn’t say any of those drivers has an outsized effect on the overall revenue guide.

Jeff Grampp: Got it. I appreciate those details. And my only other question. Can you guys touch on kind of supply chain component availability, how that’s been trending and your comfort level with that as we progressed through the year?

Kyle Udseth: Yes. It’s not really been an issue that’s impacted. Our businesses are necessarily the resi space as much. I remember the old Sunrun days when the main thing was no one could get batteries. That’s not really the issue anymore. I think a lot of the module shortages over the past year, 18 months, two years have really accrued more to the utility scale side of it. We did experience a transition in Hawaii last year when early in the year, LG had let us know that they were no longer going to be supplying U.S. residential modules. We had enough heads up where we could pivot successfully both by snapping up as much to the LG panel backlog and inventory as we could find across the country and abroad. And then also having a successful transition to a new panel vendor in Qcells and so Chris and the team managed that really well and so no disruptions from that.

And as we look out going forward, it’s really not something we talk about as a risk factor. We’re certainly always keeping our eyes on the market, whether it’s modules, whether it’s inverters, whether it’s batteries, other balances systems, but we haven’t been impacted by supply chain and don’t anticipate that and don’t really talk about that as a material risk factor in 2023.

Jeff Grampp: Okay. Well, sounds good. Well, thanks for the time guys.

Kyle Udseth: Yes. Thanks for joining.

Eric Ingvaldson: Thank you, Jeff.