On August 29, 2026, Sungrow released the record of an investor relations event. At the event, the company presented its operating results for the first half of 2026: energy storage shipments of 25 GWh, up 28% year on year. Storage revenue, however, came to RMB 15.4 billion, down from the same period last year, mainly due to lower utility-scale storage revenue, with the Middle East down RMB 5.2 billion year on year.
Sungrow also expects AIDC-related business—covering both AIDC power and AIDC energy storage—to grow at a very high rate from next year. The company currently holds about 2 GWh of AIDC storage orders in hand, with more than 10 GWh of projects in the pipeline. In the Q&A session, "Do the AIDC power and AIDC storage businesses have the potential to create another Sungrow?" became a hot topic.
The following is a summary of the investor relations event.
Middle East Revenue Down 91%
In the first half of 2026, the company’s revenue was RMB 30.9 billion, down 29% year on year, mainly due to declines in domestic and Middle East revenue. Domestically, PV installations fell and the company strategically abandoned loss-making projects; revenue from residential PV, new energy project investment and development, and energy storage all declined, with domestic revenue dropping 55% from RMB 18.1 billion a year earlier to RMB 8.2 billion in the first half of 2026. In the Middle East, revenue fell 91% from RMB 5.7 billion to RMB 1.1 billion, due to the delivery of the large Saudi project in the same period last year.
Quarter on quarter, operations improved: revenue was down RMB 210 million sequentially, net profit attributable to shareholders rose RMB 680 million, gross margin climbed from 33% to 38%, and net margin rose from 14.4% in the first quarter to 19% in the second quarter.
By business, the main profit contributions came from PV inverters and energy storage.
Domestic Inverter Shipments Down 14 GW
In inverters, shipments in the first half of 2026 totaled 66 GW, down 10 GW from 76 GW a year earlier, driven by a 14 GW decline in China, while overseas shipments kept pace with market growth.
The domestic decline mainly reflects China’s PV installations dropping from 212 GW in the first half of last year to 72 GW this year. Inverter revenue in the first half was RMB 10.8 billion, down year on year, mainly due to the sharp fall in domestic installations. Inverter profitability, however, improved, thanks to a shift in the regional mix—a lower share of domestic revenue and a higher share of overseas revenue—as well as the company’s leading global market position, strong brand premium, full-scenario product coverage, stable and reliable quality, cost-effective products, and a comprehensive after-sales service network.
H1 Storage Shipments 25 GWh, Up 28%
In energy storage, shipments reached 25 GWh in the first half of 2026, up 28% year on year. Storage revenue was RMB 15.4 billion, down from the same period last year, mainly due to lower utility-scale storage revenue, with the Middle East down RMB 5.2 billion year on year. During the period, the company’s 7.5 GWh order in the UAE fully demonstrated its leading competitive advantages in utility-scale storage.
How to View the Storage Profitability Outlook? What Is the Long-Term Trend for Utility-Scale Storage Margins?
In recent years, inverter gross margins have been stable, as has the competitive landscape. Storage gross margins have fluctuated quarter by quarter, driven mainly by three factors: storage duration, regional mix and upstream lithium carbonate prices. Longer storage durations globally weigh on gross margins; margins differ significantly across markets—China, Europe, Asia-Pacific and the Middle East—and the quarterly regional mix of revenue recognition also affects margins. After its earlier sharp rise, lithium carbonate now fluctuates in the range of RMB 130,000-160,000 per tonne, which also affects margins. The company’s storage gross margin was 32% in the first quarter and 35% in the second, up quarter on quarter; margins for the third and fourth quarters will need to be observed quarter by quarter, depending on the regional mix of revenue recognition and lithium carbonate costs.
Over the long term, utility-scale storage gross margins will be stable with a mild decline. That is not entirely a bad thing—it will discourage some cut-throat competition and support the healthy development of the industry. The company is confident it can maintain a premium through scale, product innovation, service support and brand image in future competition.
About 2 GWh of AIDC Storage Orders in Hand, More Than 10 GWh in the Pipeline
The company expects AIDC-related business to grow at a very high rate from next year. There are two parts: AIDC power and AIDC storage. The company currently holds about 2 GWh of AIDC storage orders in hand, with more than 10 GWh of projects being followed up.
In AIDC power, no SST has yet been put into real commercial operation globally. The company has delivered several SST units to customers and expects them to enter operation in the fourth quarter, with a chance to be the first to achieve live-load operation of an SST 800V DC power supply solution in a real computing scenario.
Internally, the SST test platform is basically complete, with the capability for dynamic-response dummy loads and simulated AIDC loads, plus self-developed 10 kV and 35 kV grid simulators. Production line processes are also being refined. On products, in addition to the 13.8 kV and 10 kV SSTs, a 35 kV SST is expected to complete development in the first half of next year.
On orders, the company expects to receive orders gradually from the fourth quarter, deliver small volumes next year, and enter large-scale delivery in 2028. The company keeps close communication with leading overseas AI companies and has independent cooperation timelines; milestones will be announced when reached. The company’s advantage lies in integrated solutions covering 800V, low voltage, energy storage and green power solutions.
Impact of the US FCC Policy on the Company’s Business?
The FCC policy, as it stands, targets new products and new models going forward. PV and storage products in the US market iterate relatively slowly, so as long as the policy remains unchanged, existing products still have several years of life.
Executive Order 14420, on its face, covers transmission system equipment at 69 kV and above; local distribution equipment is not covered. US distributed solar-plus-storage projects connect at 13.8 kV, while large-scale projects connect at 34.5 kV and then step up to 69 kV and above. At which point the restrictions kick in is currently unclear.
In the long term, amid geopolitical volatility, US business volume will gradually shrink somewhat. The company will transform, strengthen innovation, tilt toward other regional markets and develop its channel business, while appropriately scaling back US business to keep risk under control.
No Plans for US Local Production
The company currently has no plans to localize production in the US. The current competitive environment is unfair to Chinese companies: even with local production, US consumers would still have doubts, and manufacturing in the US offers little cost advantage. The company is also seeking cooperation with overseas companies, such as in components, services and small systems. US business will not disappear overnight.
Can the AIDC Power and AIDC Storage Businesses Create Another Sungrow?
The company has high hopes for its AIDC business. The global data center system power market is growing rapidly and shifting toward high-voltage DC, so the certainty of SST growth is strong. AIDC storage is also on the eve of a boom: for now it serves grid-connection queue requirements, and later there will be demand for load smoothing, arbitrage and optimizing connection capacity. The company has extensive arrangements and accumulation in AIDC and renewables, storage and standalone storage, and expects explosive growth in related businesses.
Power Components Generally Sufficient
With the construction boom in data centers, power component supply has tightened, but it is generally sufficient, with some small components such as MLCCs seeing price increases.
Is There Upside in the European Storage Market? What Are the Changes in Prices and the Competitive Landscape?
European growth in the first half was better than expected, mainly because: (1) the EU passed a 2030 target of 200 GW of storage installations, implying average annual additions of 28 GW in 2026-2030; (2) negative-price hours in European electricity markets are lengthening and peak-valley spreads widening, compounded by drivers such as ancillary services and capacity markets. European storage market growth is expected to remain above 50% next year. Prices in Europe are generally stable, with differences by region and country: Eastern Europe is slightly price-sensitive, and longer-duration projects carry slightly lower prices.
