First Solar's revenue miss and disappointing guidance cause its stock price to decline.

• On Tuesday, First Solar's shares fell more than 16% in extended trading after the company announced that it had missed revenue expectations in the fourth quarter and provided weak full-year guidance.
• While Wall Street predicted full-year revenue of $2.76 billion, the company anticipates revenue between $2.4 billion and $2.6 billion.
• The solar-manufacturing industry will face challenges in 2021, including issues with supply chain, logistics, costs, and the pandemic.

On Tuesday, during extended trading, shares of dropped more than 16% after the company reported missing revenue expectations during the fourth quarter and issued weak full-year guidance.

The solar-panel manufacturer has faced rising raw material costs and supply chain bottlenecks.

The company's fourth-quarter results exceeded Refinitiv's estimates.

• EPS: $1.23 per share vs. $1.06 expected
• Revenue: $907 million vs. $918 million

Wall Street's expectations for First Solar's full-year revenue were higher than the company's guidance, which forecasts revenue between $2.4 billion and $2.6 billion.

The company anticipates earnings per share to fall between breakeven and 60 cents for the year, significantly below the $1.92 analysts had forecasted.

The solar-manufacturing industry encountered "supply chain, logistics, cost, and pandemic-related challenges" in 2020, according to First Solar CEO Mark Widmar.

The company is in advanced-stage discussions to sell its project development and operations and maintenance platform in Japan.

Widmar predicted that 2022 will be a crucial year, with substantial investments in manufacturing expansion, new producers, R&D, and new contracting strategies.

During the company's quarterly update conference call, management acknowledged that 2022 is likely to be a difficult year in terms of earnings, particularly due to the increase in freight costs. Contracted volumes have increased by between 200% and 300% above pre-pandemic levels, First Solar stated. The company anticipates a 100% increase in contracted freight rates in 2022.

The increase in transit times has resulted in a significant deterioration of reliability and availability, leading to a higher price spot market for more volume.

Steel prices increased by 40% in 2021, contributing to the company's rising commodity costs.

This story is developing, please check back for updates.