EMEREN GROUP LTD_March 31, 2025

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-33911

EMEREN GROUP LTD

(Exact Name of Registrant as Specified in Its Charter)

British Virgin Islands		N/A
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification Number)

149 Water Street, Suite 302, Norwalk, Connecticut 06854 U.S.A.

(Address of Principal Executive Offices) (Zip Code)

+1 925-425-7335

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
American Depositary Shares, each representing	SOL	New York Stock Exchange
10 shares, no par value per share

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days YES ☒ NO ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). YES ☒ NO ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.



Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ☐ NO ☒

As of March 31, 2025, 513,216,222 ordinary shares, no par value per share, were issued and outstanding. Each of the ordinary shares of the registrant’s American Depositary Shares represents 10 shares on the New York Stock Exchange.

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EMEREN GROUP LTD

TABLE OF CONTENTS

		PAGES
	Forward-Looking Statements	ii
PART I.	FINANCIAL INFORMATION	1
Item 1.	Financial Statements	1
	Unaudited Condensed Consolidated Balance Sheets	1
	Unaudited Condensed Consolidated Statements of Operations	3
	Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss)	4
	Unaudited Condensed Consolidated Statements of Changes in Shareholders’ Equity	5
	Unaudited Condensed Consolidated Statements of Cash Flows	6
	Notes to Unaudited Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	35
Item 4.	Controls and Procedures	35

PART II.	OTHER INFORMATION	36
Item 1.	Legal Proceedings	36
Item 1A.	Risk Factors	36
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	37
Item 3.	Defaults Upon Senior Securities	37
Item 4.	Mine Safety Disclosures	37
Item 5.	Other Information	37
Item 6.	Exhibits	38
	Signatures	39

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FORWARD-LOOKING STATEMENTS

Some of the statements contained in this Quarterly Report on Form 10-Q of Emeren Group Ltd (hereinafter referred to as “Emeren Group Ltd”, “we”, “our”, or the “Company”) are “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995 (the “PSLRA”). All statements other than statements of historical fact included in this Form 10-Q, including statements regarding the Company’s future financial condition, results of operations, plans, objectives, expectations, future performance, business operations or business prospects, are forward-looking statements. Words such as “believes,” “expects,” “anticipates,” “will,” “could,” “plans, “estimates,” “predicts,” “goals,” “should,” “will,” “could,” “would,” “may,” forecast,” “seeks,” and other similar expressions and variations of such words are intended to identify forward-looking statements and are included, along with this statement, with the intention these forward-looking statements be covered by the safe harbor provisions for forward-looking statements contained in the PSLRA. Forward-looking statements are neither historical facts, nor assurances of future performance. Instead, such statements are based only on our beliefs, expectations and assumptions regarding the future, which may not prove to be accurate, and are subject to known and unknown risks and uncertainties, many of which are outside of our control. These risks and uncertainties could cause actual events or results to differ materially from our historical experience and management’s present expectations or projections. These risks and uncertainties are discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on March 25, 2025, as amended by the Annual Report on Form 10-K/A filed with the SEC on March 26, 2025 and the Annual Report on Form 10-K/A filed with the SEC on April 22, 2025 (together, the “Annual Report on Form 10-K”). Any forward-looking statement speaks only as of the date on which it is made.

You are cautioned not to place undue reliance on any forward-looking statements. Except as required by law, we undertake no obligation to publicly update or release any revisions to these forward-looking statements to reflect any events or circumstances after the date of this Form 10-Q or to reflect the occurrence of unanticipated events, whether as a result of new information, future events, or otherwise.

Additionally, the following discussion regarding our financial condition and results of operations should be read in conjunction with the condensed consolidated financial statements and related notes included in this Quarterly Report on Form 10-Q.

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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

EMEREN GROUP LTD

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts expressed in U.S. dollars in thousands, except for number of shares and per share amounts)


		As of
	Notes	March 31, 2025		December 31, 2024
ASSETS
Current assets:
Cash and cash equivalents	2	$	52,885	$	50,012
Accounts receivable trade, net	3		20,782		21,121
Accounts receivable unbilled, net	3		44,047		41,330
Advances to suppliers	2		903		568
Value added tax recoverables			8,821		8,005
Project assets, current	5		50,640		54,267
Prepaid expenses and other current assets, net	4		18,976		16,085
Total current assets			197,054		191,388

Property, plant and equipment, net	6		197,408		194,839
Project assets, non-current	5		22,716		14,444
Operating lease, right-of-use assets	16		19,474		19,931
Finance lease, right-of-use assets	8		4,534		4,574
Other non-current assets	3		23,736		22,390
Total assets		$	464,922	$	447,566

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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EMEREN GROUP LTD

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Continued)

(Amounts expressed in U.S. dollars in thousands, except for number of shares and per share amounts)


		As of
	Notes	March 31, 2025		December 31, 2024
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	11,056	$	11,892
Advances from customers	2		4,924		5,042
Amounts due to related parties	15		3,371		4,028
Long-term borrowings, current	8		1,651		1,181
Income tax payable	7		1,063		606
Salaries payable			2,189		1,265
Operating lease liabilities, current	16		557		659
Failed sales-leaseback and finance lease liabilities, current	8		5,046		5,014
Other current liabilities	9		19,087		19,831
Total current liabilities			48,944		49,518

Long-term borrowings, non-current	8		37,942		23,515
Operating lease liabilities, non-current	16		19,377		19,252
Failed sales-leaseback and finance lease liabilities, non-current	8		13,374		13,767
Deferred tax liabilities	7		3,636		3,494
Total liabilities			123,273		109,546

Commitments and contingencies

Shareholders’ equity
Common shares (1,000,000,000 shares, no par value, authorized at March 31, 2025 and December 31, 2024; 637,920,142 shares issued and 513,216,222 shares outstanding at March 31, 2025; 652,821,742 shares issued and 513,216,222 shares outstanding at December 31, 2024)	10		806,714		806,714
Additional paid-in capital			15,180		15,104
Treasury stock, at cost (124,703,920 and 124,703,920 shares as of March 31, 2025 and December 31, 2024, respectively)	10		(49,146)		(49,146)
Accumulated deficit			(451,500)		(453,040)
Accumulated other comprehensive loss			(17,192)		(19,116)

Emeren Group Ltd shareholders’ equity			304,056		300,516
Non-controlling interest			37,593		37,504
Total shareholders’ equity			341,649		338,020

Total liabilities and shareholders’ equity		$	464,922	$	447,566

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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EMEREN GROUP LTD

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts expressed in U.S. dollars in thousands, except for number of shares and per share amounts)


	Three Months Ended March 31,
	2025		2024
Net revenues:
Solar power project development	$	317	$	—
Electricity generation		6,701		5,384
EPC services		—		4,137
DSA		1,104		5,062
Others		32		17
Total net revenues		8,154		14,600
Cost of revenues		(4,945)		(10,278)
Gross profit		3,209		4,322

Operating expenses:
Sales and marketing		(37)		(61)
General and administrative		(4,479)		(4,622)
Other operating expenses, net		(2,791)		(852)
Total operating expenses		(7,307)		(5,535)

Loss from operations		(4,098)		(1,213)

Other income (expenses):
Interest income		416		520
Interest expense		(379)		(385)
Unrealized foreign exchange gain (loss)		6,198		(3,253)
Total other income (expense), net		6,235		(3,118)

Income (loss) before income tax		2,137		(4,331)
Income tax expense		(658)		(1,157)

Net income (loss)		1,479		(5,488)
Less: net (loss) income attributed to non-controlling interests		(61)		437
Net income (loss) attributed to Emeren Group Ltd	$	1,540	$	(5,925)

Income (loss) attributed to Emeren Group Ltd per ADS*
Basic	$	0.03	$	(0.11)
Diluted	$	0.03	$	(0.11)
Weighted average number of ADS* used in computing loss per ADS*
Basic		51,321,622		53,553,650
Diluted		51,392,601		53,553,650

*	Each American depositary share (“ADS”) represents 10 common shares

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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EMEREN GROUP LTD

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Amounts expressed in U.S. dollars in thousands)


	Three Months Ended March 31,
	2025		2024
Net income (loss)	$	1,479	$	(5,488)
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment		2,074		(2,955)
Other comprehensive income (loss)		2,074		(2,955)
Comprehensive income (loss)		3,553		(8,443)
Less: comprehensive income (loss) attributed to non-controlling interests		89		(244)
Comprehensive income (loss) attributed to Emeren Group Ltd	$	3,464	$	(8,199)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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EMEREN GROUP LTD

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(Amount expressed in U.S. dollars in thousands, except for number of shares)


											Accumulated
	Common shares			Treasury stock			Additional				other		Equity
	Number of			Number of			paid-in		Accumulated		comprehensive		attributable to		Non-controlling
	Shares Issued	Amount		Shares Issued	Amount		capital		deficit		income (loss)		Emeren Group Ltd		interest		Total equity
Balance at December 31, 2023	651,821,742	$	806,714	(90,715,770)	$	(41,938)	$	14,728	$	(440,563)	$	(13,629)	$	325,312	$	37,997	$	363,309
Net income (loss)	—		—	—		—		—		(5,925)		—		(5,925)		437		(5,488)
Stock repurchase	—		—	(29,258,280)		(6,178)		—		—		—		(6,178)		—		(6,178)
Share-based compensation	—		—	—		—		29		—		—		29		—		29
Issuance of common stock from release of restricted share units	333,333		—	—		—		—		—		—		—		—		—
Other comprehensive loss, net of tax	—		—	—		—		—		—		(2,274)		(2,274)		(681)		(2,955)
Balance at March 31, 2024	652,155,075	$	806,714	(119,974,050)	$	(48,116)	$	14,757	$	(446,488)	$	(15,903)	$	310,964	$	37,753	$	348,717

Balance at December 31, 2024	652,821,742	$	806,714	(124,703,920)	$	(49,146)	$	15,104	$	(453,040)	$	(19,116)	$	300,516	$	37,504	$	338,020
Net income (loss)	—		—	—		—		—		1,540		—		1,540		(61)		1,479
Share-based compensation	—		—	—		—		76		—		—		76		—		76
Issuance of common shares adjustment (Note 10)	(14,901,600)		—	—		—		—		—		—		—		—		—
Other comprehensive income, net of tax	—		—	—		—		—		—		1,924		1,924		150		2,074
Balance at March 31, 2025	637,920,142	$	806,714	(124,703,920)	$	(49,146)	$	15,180	$	(451,500)	$	(17,192)	$	304,056	$	37,593	$	341,649

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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EMEREN GROUP LTD

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts expressed in U.S. dollars in thousands)


	Three Months Ended March 31,
	2025		2024
Operating activities:
Net income (loss)	$	1,479	$	(5,488)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation		2,108		1,751
Allowances for credit losses		3		262
Loss on cancellation of project assets		2,228		942
Loss on disposal of property, plant and equipment		503		—
Share-based compensation		76		29
Deferred tax provision		10		33
Changes in operating assets and liabilities:
Accounts receivable, trade and unbilled		762		8,623
Advances to suppliers		(314)		(801)
Value added tax recoverable		(599)		(1,866)
Prepaid expenses and other current assets		(3,021)		(2,295)
Project assets		(4,610)		(11,603)
Other non-current assets		(88)		(781)
Accounts payable		(744)		2,638
Advances from customers		(331)		—
Amounts due to related parties		(764)		939
Other current liabilities		50		(170)
Income tax payable		481		1,031
Salaries payable		879		(32)
Net cash used in operating activities		(1,892)		(6,788)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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EMEREN GROUP LTD

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Amounts expressed in U.S. dollars in thousands)


		Three Months Ended March 31,
	Notes	2025		2024
Investing activities:
Purchase of property, plant and equipment			(2,653)		(2,849)
Proceeds from disposal of property, plant and equipment			551		242
Net cash used in investing activities			(2,102)		(2,607)
Financing activities:
Proceeds from banks and other third-party borrowings			15,269		779
Repayment of banks and other third-party borrowings			(1,149)		(987)
Debt issuance costs			(241)		—
Repurchase of shares			—		(6,178)
Proceeds from failed sales-leaseback			866		—
Repayment of finance lease obligations			(263)		(689)
Repayment of failed sales-leaseback financing			(1,238)		(1,112)
Net cash provided by (used in) financing activities			13,244		(8,187)
Effect of exchange rate changes			(5,675)		2,481
Net increase (decrease) in cash and cash equivalents and restricted cash			3,575		(15,101)
Cash and cash equivalents and restricted cash, beginning of period			50,012		70,174
Cash and cash equivalents and restricted cash, end of period	2	$	53,587	$	55,073

Supplemental schedule of non-cash operating activities:
Transfer from property, plant and equipment, net to project assets, current		$	—	$	(9,863)

Supplemental schedule of non-cash investing and financing activities:
Payables for purchase of property, plant and equipment		$	(12,144)	$	(11,717)
Payable for finance leases		$	(2,042)	$	(2,853)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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EMEREN GROUP LTD

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. ORGANIZATION AND NATURE OF OPERATIONS

Emeren Group Ltd was incorporated in the British Virgin Islands on March 17, 2006. On January 29, 2008, Emeren Group Ltd and its subsidiaries (collectively, the “Company”) became listed on the New York Stock Exchange (“NYSE”) in the United States. The Company is a solar project developer and operator, a solar downstream player. The Company develops and sells solar power projects or sells project Special Purpose Vehicles (“SPVs”) (project development business); provides engineering, procurement and construction business (“EPC business”); owns and operates solar power projects and sells the electricity generated by the operated solar power plants (“IPP business”); and provides Development Services Agreement (“DSA”). The Company conducts the IPP business, EPC business, DSA business and project development business in a number of countries, including United States (“U.S.”), Poland, Hungary, Spain, France, United Kingdom (“UK”), Germany, Italy, Luxembourg and People’s Republic of China (“PRC”).

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The unaudited condensed consolidated financial statements have been prepared and presented in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”) and, therefore, certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been omitted.

In the opinion of management, the information reflects all adjustments necessary to make the results of operations for the interim periods a fair statement of such operations. All such adjustments are of a normal recurring nature. Quarterly results are not necessarily indicative of results for the full year. The condensed consolidated balance sheet as of December 31, 2024 has been derived from the audited consolidated financial statements at that date but does not include all information and footnotes required by U.S. GAAP for complete financial statements. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

The accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The realization of assets and the satisfaction of liabilities in the normal course of business are dependent on, among other things, the Company’s ability to generate cash flows from operations, and the Company’s ability to arrange adequate financing arrangements, to support its working capital requirements.

Basis of consolidation

The unaudited condensed consolidated financial statements include the financial statements of Emeren Group Ltd and its subsidiaries. All inter-company transactions, balances and realized and unrealized profits and losses have been eliminated on consolidation.

A non-controlling interest is recognized to reflect the portion of a subsidiary’s equity which is not attributable, directly or indirectly, to the Company. Net income (loss) on the condensed consolidated statements of operations and comprehensive income (loss) includes the net income (loss) attributable to non-controlling interests when applicable. The cumulative results of operations attributable to non-controlling interests are also recorded as non-controlling interests in the Company’s condensed consolidated balance sheets. Cash flows related to transactions with non-controlling interests are presented under financing activities in the condensed consolidated statements of cash flows, when applicable.

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Use of estimates

The preparation of unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses for the reporting periods presented. Actual results could materially differ from these estimates. Significant accounting estimates are susceptible to changes with the acquisition of the information, which include revenue recognition for sales of project asset rights, transaction price estimates with variable consideration, percentage of completion of EPC services, EPC warranties, allowances for credit losses, valuation of deferred tax assets, and recoverability of the carrying value of long-lived assets and project assets. Management bases its estimates and judgments on historical experience and on various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

Fair value measurement

The Company estimates fair value of financial assets and liabilities as the price that would be received from the sales of an asset or paid to transfer a liability (an exit price) on the measurement date in an orderly transaction between market participants. The Company utilizes a hierarchy for inputs used in measuring fair value that gives the highest priority to observable inputs and the lowest priority to unobservable inputs. Valuation techniques used to measure fair value maximize the use of observable inputs.

When available, the Company measures the fair value of financial instruments based on quoted market prices in active markets (Level 1 inputs), valuation techniques that use observable market-based inputs (Level 2 inputs) or unobservable inputs that are corroborated by market data. Pricing information the Company obtains from third parties is internally validated for reasonableness prior to use in the unaudited condensed consolidated financial statements. When observable market prices are not readily available, the Company generally estimates the fair value using valuation techniques that rely on alternate market data or inputs that are generally less readily observable from objective sources and are estimated based on pertinent information available at the time of the applicable reporting periods (Level 3 inputs).

In certain cases, fair values are not subject to precise quantification or verification and may fluctuate as economic and market factors vary and as the Company’s evaluation of those factors changes. Although the Company uses its best judgment in estimating the fair value of these financial instruments, there are inherent limitations in any estimation technique. In these cases, a minor change in an assumption could result in a significant change in its estimate of fair value, thereby increasing or decreasing the amounts of the Company’s consolidated assets, liabilities, equity and net income or loss.

Financial assets and liabilities held by the Company measured at fair value on a recurring basis as of March 31, 2025 and December 31, 2024 include cash and cash equivalents, accounts receivable, accounts payable and salaries payable.

The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and salaries payable approximate their fair value because of their short-term nature (classified as Level 1).

Significant accounting policies

There have been no material changes to the Company’s significant accounting policies disclosed in our audited consolidated financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2024.

Cash and cash equivalents

The Company maintains its cash and cash equivalents in bank accounts which, at times, exceed the federally insured limits. As of March 31, 2025 and December 31, 2024, the Company had cash in excess of the FDIC insured amount. The Company has not experienced any losses in such accounts.

Cash restricted for use as a result of financing is classified separately as restricted cash. If the restricted cash is unavailable for a period longer than one year from the balance sheet date, the restricted cash is included in “other non-current assets.” Otherwise, restricted cash is included as a separate line item on the Company’s condensed consolidated balance sheets.

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The following table reconciles cash, cash equivalents, and restricted cash from the condensed consolidated statements of cash flows to the condensed consolidated balance sheets.


	March 31,		December 31,
	2025		2024

	in thousands
Cash and cash equivalents	$	52,885	$	50,012
Restricted cash – other non-current assets		702		—
Total cash, cash equivalents and restricted cash	$	53,587	$	50,012

Advances to suppliers

As of March 31, 2025 and December 31, 2024, advances to suppliers in current assets were $0.9 million and $0.6 million, respectively. The Company does not require collateral or other security against its advances to suppliers. As a result, the Company’s claims for such prepayments are unsecured, which exposes the Company to the suppliers’ credit risk. The Company performs ongoing credit evaluations of the financial condition of its material suppliers.

Leases

Operating lease costs are recognized on a straight-line basis over the lease term. From time to time, the Company’s subsidiaries are asked to prepay the lease costs for over one year. As of March 31, 2025 and December 31, 2024, the prepaid rental fees of $1.3 million and $1.3 million, respectively, were recorded in operating lease right-of-use assets.

Revenue recognition

The Company primarily derives its revenues from the following revenue streams:

●

Solar power project development – This is comprised of sale of project assets constructed by a third-party EPC contractor, sale of project assets constructed by the Company’s own EPC team, and sale of project asset rights.

●

EPC Services – Certain of the EPC contracts for photovoltaic (PV) solar power systems contain retainage provisions. Retainage represents contract costs for the portion of the contract price earned for work performed but held for payment by the customer as a form of security until a certain defined timeframe has been reached. The Company considers whether collectability of such retainage is reasonably assured in connection with our overall assessment of the collectability of amounts due or that will become due under the EPC contracts. After the Company has satisfied the EPC contract requirements and has an unconditional right to consideration, the retainage is billed and reclassified to “Accounts receivable from EPC services (billed)”. As of March 31, 2025 and December 31, 2024, the unbilled balance of accounts receivable from EPC services included in accounts receivable unbilled, net were $43.0 million and $40.4 million, respectively.

●

Electricity generation – See Note 3, “Accounts Receivable Trade, Net” for further details.

●

DSA and others – DSA revenue is recognized over time based on the percentage of completion by using the cost-based input method upon the performance of relevant project development activities. Ancillary revenues are recorded in others.

Contract liability

Advances from customers, which represent contract liabilities, are payments received from customers which are unrecognized revenue. Advances from customers are recognized as the Company performs its obligations under the contract. During the three months ended March 31, 2025 and 2024, the Company recognized $0.1 million and zero as revenue that was included in the balances of advances from customers as of January 1, 2025 and 2024, respectively.

Deferred revenue, included in other current liabilities, represents the excess billings to date over the amount of revenue recognized to date. The timing and the amount we bill our customers is based on achieving milestones as defined in the contract with the customers. See Note 9, “Other Current Liabilities” for further details.

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Disaggregation of revenue

The following tables summarizes the Company’s revenues by recognition points:


	Three months ended March 31,
	2025		2024

	in thousands
Solar power project development	$	317	$	—
Revenue recognized at a point in time		317		—
EPC services		—		4,137
Electricity generation		6,701		5,384
DSA		1,104		5,062
Others		32		17
Revenue recognized over time		7,837		14,600
Total	$	8,154	$	14,600

The following table summarizes the Company’s revenues generated by the geographic location of customers:


	Three months ended March 31,
	2025		2024

		in thousands
China	$	3,393	$	2,881
United States		349		407
UK		2,492		2,097
France		147		1
Poland		32		2,460
Italy		1,104		5,062
Hungary		637		1,692
Total	$	8,154	$	14,600

See Note 17, “Segment Reporting” for further details.

Feed-in tariff (s) (FIT) payments

The Company collected FIT payments of $0.1 million and $0.1 million for the electricity sold to the state grid companies in the PRC for the three months ended March 31, 2025 and 2024, respectively.

The Company recognized non-FIT payments of attracting foreign investment of zero and $0.1 million in other operating income and expense, net for the three months ended March 31, 2025 and 2024, respectively.

Foreign currency

Renminbi (“RMB”) is not a freely convertible currency. The PRC State Administration for Foreign Exchange, under the authority of the People’s Bank of China, controls the conversion of RMB into foreign currencies. The value of the RMB is subject to changes in central government policies and to international economic and political developments affecting supply and demand in the China foreign exchange trading system market. The Company’s cash and cash equivalents and restricted cash denominated in RMB amounted to RMB 62.0 million ($8.5 million) and RMB 72.5 million ($9.9 million) on March 31, 2025 and December 31, 2024, respectively.

Comprehensive income (loss)

Comprehensive income (loss) is the change in equity during a period from transactions and other events and circumstances from non-shareholder sources and included net income (loss) and foreign currency translation adjustments. As of March 31, 2025 and December 31, 2024, accumulated other comprehensive income (loss) is mainly composed of foreign currency translation adjustments.

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Recently issued accounting pronouncements

New Accounting Pronouncements

In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2024-04: Debt – Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments, which clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as induced conversion. The amendments in this ASU are effective for all entities for annual reporting periods beginning after December 15, 2025, and interim periods within those annual reporting periods. The Company’s management is evaluating the impact this guidance will have on its consolidated financial statements and disclosures.

In November 2024, the FASB issued ASU No. 2024-03: Income Statement – Reporting Comprehensive Income–Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires disclosure of qualitative and quantitative information about certain costs and expenses in the notes to the financial statements on an interim and annual basis. The amendments in this ASU are effective for public business entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company’s management is evaluating the impact this guidance will have on its consolidated financial statements and disclosures.

In December 2023, the FASB issued ASU No. 2023-09: Income Taxes (Topic 740) – Improvements to Income Tax Disclosures, which requires disclosure of incremental income tax information within the rate reconciliation and expanded disclosures of income taxes paid, among other disclosure requirements. ASU No. 2023-09 is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company’s management does not believe the adoption of ASU No. 2023-09 will have a material impact on its consolidated financial statements and disclosures.

Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on our financial statements.

3. ACCOUNTS RECEIVABLE TRADE, NET


	March 31,		December 31,
	2025		2024

	in thousands
Accounts receivable trade
– from EPC services	$	4,108	$	4,008
– from solar power project assets and DSA		8,857		10,447
– from electricity generation ⁽¹⁾		12,010		10,132
– from others		39		672
Total accounts receivable trade		25,014		25,259
Less: allowance for credit losses		(4,232)		(4,138)
Accounts receivable trade, net	$	20,782	$	21,121

(1)

Accounts receivable from electricity generation were mainly due from China’s state grid companies. The amounts included the portion of feed-in tariff(s) (FIT) for the electricity sold to the state grid companies in the PRC in which the relevant on-grid solar power stations are still pending for registration to the Renewable Energy Subsidy Catalog, which the Company has submitted the application for its solar power stations that started operation before July 2017 to be registered on the Catalog. The Company expects that a certain part of the FIT receivables will be recovered after twelve months from the reporting date, which are discounted at an effective interest rate. As of March 31, 2025 and December 31, 2024, there are $4.0 million and $3.8 million of FIT receivables classified as current, and $18.2 million and $17.2 million classified as non-current, which is included in the other non-current assets on the condensed consolidated balance sheets, respectively.

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ACCOUNTS RECEIVABLE UNBILLED, NET


	March 31,		December 31,
	2025		2024

	in thousands
Accounts receivable unbilled
–from solar power project assets	$	1,783	$	1,581
–from EPC services		43,038		40,406
–from electricity generation and others		242		297
Total accounts receivable unbilled		45,063		42,284
Less: allowance for credit losses		(1,016)		(954)
Accounts receivable unbilled, net	$	44,047	$	41,330

The Company’s contract assets classified as “Accounts receivable unbilled” are primary due to billing of certain project sales and EPC services where the Company has the right to consideration in exchange of the project sales transferred and EPC services performed.

ALLOWANCE FOR CREDIT LOSSES

The Company establishes an allowance for expected credit losses based on historically observed default rates over the expected life of the receivable balance and are adjusted for forward-looking information available without undue cost of effort. The Company’s management regularly reviews the allowance for credit losses to ensure relevant information about specific debtors is updated.

The following table shows the movement in lifetime expected credit losses that has been recognized for trade receivables under the simplified approach.


	March 31,		December 31,
	2025		2024

	in thousands
At beginning of the period	$	5,092	$	5,203
Allowance for credit losses for the period		3		3,506
Written off		—		(3,617)
Other (foreign currency effects)		153		—
At end of the period	$	5,248	$	5,092

During the three months ended March 31, 2025 and 2024, the Company recorded credit losses of $0.003 million and $0.2 million, respectively.

CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS

As of March 31, 2025, receivables from a solar power customer amounted to $47.1 million, including billed receivable of $4.0 million and unbilled receivable of $43.0 million which accounts for 67.2% of the Company’s total receivables, excluding FIT receivables in the other non-current assets, which are due from China government subsidies. As of December 31, 2024, receivables from a solar power customer amounted to $44.2 million, including billed receivable of $3.8 million and unbilled receivable of $40.4 million which accounts for 65.5% of the Company’s total receivables, excluding FIT receivables in the other non-current assets, which are due from China government subsidies.

For the three months ended March 31, 2025 and 2024, revenue from this solar power customer accounted for zero and 17% ($2.4 million) of the Company’s total net revenues, respectively.

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4. PREPAID EXPENSES AND OTHER CURRENT ASSETS


	March 31,		December 31,
	2025		2024

	in thousands
Receivables from disposal of property, plant and equipment ⁽¹⁾	$	532	$	1,079
Deposits ⁽²⁾		12,048		9,863
Others ⁽³⁾		7,117		5,861
Total prepaid expenses and other current assets		19,697		16,803
Less: allowance for credit losses⁽⁴⁾		(721)		(718)
Total prepaid expenses and other current assets	$	18,976	$	16,085

(1)	Receivables from disposal of property, plant and equipment mainly represented disposal of Company’s solar power stations assets which were primarily used for the electricity generation revenue segment.

(2)	As of March 31, 2025 and December 31, 2024, deposits mainly represented deposits made for interconnection, and the bidding of project asset construction rights and rooftop leases.

(3)

As of March 31, 2025, others mainly included $0.8 million prepaid deposits for U.S. sold project assets, $1.4 million deferred cost for U.S. projects, $2.7 million deferred cost for Italy projects, $0.7 million prepayment on Korea project development (the Company has recorded 100% allowance for credit losses associated with such prepayment), and $0.5 million prepaid for a UK project. As of December 31, 2024, others mainly included $1.3 million prepaid deposits for U.S. sold project assets, $1.3 million deferred cost for U.S. projects, $1.4 million deferred cost for Italy projects, $0.7 million prepayment on Korea project development (the Company has recorded 100% allowance for credit losses associated with such prepayment), and $0.5 million prepaid for a UK project.

(4)	As of March 31, 2025 and December 31, 2024, allowance for credit losses mainly represented the allowance for the Korea project’s prepayment which the Company deemed not recoverable.

5. PROJECT ASSETS

Project assets consisted of the following at March 31, 2025 and December 31, 2024, respectively:


	March 31,		December 31,
	2025		2024

	in thousands
Project assets - development and construction cost	$	71,940	$	67,360
Project assets - others		1,416		1,351
Total project assets	$	73,356	$	68,711

Current portion	$	50,640	$	54,267
Non-current portion	$	22,716	$	14,444

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6. PROPERTY, PLANT AND EQUIPMENT, NET

Property, plant and equipment, net:


	March 31,		December 31,
	2025		2024

	in thousands
Land	$	1,038	$	976
Plant and machinery		3		3
Motor vehicles		46		45
Office equipment		329		310
Power stations ⁽¹⁾		218,833		214,351
Less: accumulated depreciation		(37,069)		(34,760)
Subtotal		183,180		180,925
Construction in progress		14,228		13,914
Property, plant and equipment, net	$	197,408	$	194,839

(1)	In March 2024, the Company transferred power stations with a carrying value of $9.9 million to project assets, current. No impairment was recognized upon transfer.

Construction in progress mainly represents solar power projects which are under development for self-electricity generation in China.

Depreciation expense for the three months ended March 31, 2025 and 2024 was $2.1 million and $1.8 million, respectively.

7. INCOME TAXES

The Company and its subsidiaries file separate income tax returns.

The Company recorded income tax expense of $0.7 million and $1.2 million for the three months ended March 31, 2025 and 2024, respectively.

The Company’s effective tax rate for the three months ended March 31, 2025 and 2024 was 31% and (27%), respectively.

We determine our income tax provision for interim periods using an estimate of our annual effective tax rate adjusted for discrete items occurring during the periods presented. The Company’s income tax provision in the three months ended March 31, 2025 and 2024, was mainly due to income taxes on earnings from its foreign tax jurisdictions.

The Company conducts its business globally and its operating income is subject to varying rates of tax. Consequently, the Company’s effective tax rate is dependent upon the geographic distribution of its earnings or losses and the tax laws and regulations in each geographical region.

Due to historical losses in the U.S., the Company has a full valuation allowance on its U.S. federal and state deferred tax assets. Management continues to evaluate the realizability of deferred tax assets and the related valuation allowance. If management’s assessment of the deferred tax assets or the corresponding valuation allowance were to change, the Company would record the related adjustment to income during the period in which management makes the determination.

As of March 31, 2025, there are no material changes on uncertain tax positions.

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8. BORROWINGS AND OTHER FINANCING ARRANGEMENTS

Borrowings from banks and other third parties

The Company’s borrowings from banks and other third parties consist of the following:


	March 31,		December 31,
	2025		2024

	in thousands
Total debt principal	$	39,834	$	24,696
Less: unamortized debt issuance costs		241		—
Total debt		39,593		24,696
Less: long-term borrowings, current		1,651		1,181
Long-term borrowings, non-current	$	37,942	$	23,515

As of March 31, 2025 and December 31, 2024, the long-term borrowings of $39.6 million and $24.7 million were jointly guaranteed by the Company and its subsidiaries.

Long-term borrowings

In January 2021, the Company’s UK subsidiary obtained a long-term loan from a lender in the UK totaling £0.05 million ($0.06 million). The long-term loan has a maturity date of July 2026 with an annual interest rate of 2.5%. The proceeds from this loan were used for general working capital purposes. The long-term borrowing was interest free for twelve months. As of March 31, 2025 and December 31, 2024, the balance of this long-term borrowings was $0.02 million and $0.02 million, respectively.

In January 2022, the Company’s Project Branston subsidiary entered into a lease loan contract with Aviva Investor Infrastructure Income No.4 Ltd. The loan bears interest at 4.0% above the base rate time to time from Lloyds Bank Plc on the bank and will mature in April 2060. As a result of the acquisition of Branston, the Company took over the loan. As of March 31, 2025, the long-term borrowings were $22.2 million, including current of $0.4 million and non-current of $21.8 million. As of December 31, 2024, the long-term borrowings were $22.3 million, including current of $0.9 million and non-current of $21.4 million.

In September 2022, the Company’s RPZE 1 subsidiary entered into a shareholder loan contract with a minority shareholder of a subsidiary of the Company, RPZE 1, of $0.6 million. The loan bears interest at 2% per annum and will mature in December 2025. As of March 31, 2025 and December 31, 2024, the balance of the shareholder loan was $0.1 million and $0.1 million, respectively.

In February 2023, the Company’s Tensol 3 subsidiary entered into a shareholder loan contract with a minority shareholder of a subsidiary of the Company, Tensol 3, of $0.7 million. The loan bears interest at 2% per annum and will mature in December 2025. As of March 31, 2025 and December 31, 2024, the balance of the shareholder loan was $0.03 million and $0.03 million, respectively.

In November 2023, the Company’s China subsidiary obtained a long-term bank loan totaling RMB 1.3 million ($0.2 million). The long-term loan bears interest at 5.2% above the base rate time to time from Loan Prime Rate on the bank and will mature in November 2033. As of March 31, 2025, the long-term borrowings were $0.2 million, including current of $0.02 million and non-current of $0.1 million. As of December 31, 2024, the long-term borrowings were $0.2 million, including current of $0.02 million and non-current of $0.1 million.

In March 2024, the Company’s China subsidiary obtained a long-term bank loan totaling RMB 5.6 million ($0.8 million). The long-term loan bears interest at 5.2% above the base rate time to time from Loan Prime Rate on the bank and will mature in March 2034. As of March 31, 2025, the long-term borrowings were $0.7 million, including current of $0.08 million and non-current of $0.6 million. As of December 31, 2024,the long-term borrowings were $0.7 million, including current of $0.08 million and non-current of $0.7 million.

In July 2024, the Company’s China subsidiary obtained a long-term bank loan totaling RMB 10.0 million ($1.4 million). The long-term loan bears interest at 5.2% above the base rate time to time from Loan Prime Rate on the bank and will mature in June 2034. As of March 31, 2025, the long-term borrowings were $1.3 million, including current of $0.1 million and non-current of $1.2 million. As of December 31, 2024, the long-term borrowings were $1.4 million, including current of $0.1 million and non-current of $1.3 million.

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The long-term loans obtained by the Company’s China subsidiary in November 2023, March 2024, and July 2024 are guaranteed by another subsidiary of the Company. These loans are also collateralized by the underlying assets of the solar projects with a carrying amount of $3.2 million (RMB 23.5 million), as well as a 100% equity interest in a subsidiary and the rights to the future power generation income. The accounts receivable related to electricity generation revenue in China remain on the Company’s condensed consolidated balance sheets, as the transaction is accounted for as a secured borrowing under ASC 860. The Company continues to collect customer payments for the pledged accounts receivable.

In March 2025, the Company’s Hungary subsidiaries entered into a subordination agreement in connection with a $24.1 million (EUR 22.3 million) facility agreement with a local lender and received loan proceeds of $15.0 million (EUR 13.9 million) under the first of two utilization tranches. The loan bears interest at a rate of 3.0% plus the three-month EURIBOR, which resets from time to time based on prevailing market rates, and matures in March 2035.

As of March 31, 2025, the outstanding balance under the facility was $15.0 million, of which $1.0 million was classified as the current portion of long-term borrowings and $14.0 million as non-current. The facility is jointly guaranteed by the Company and certain of its subsidiaries and is secured by substantially all assets of the Company’s certain subsidiaries, which had a carrying value of $44.7 million as of March 31, 2025. The pledged assets include, among other collateral, the contractual rights to future accounts receivable. These rights remain recognized in the Company’s condensed consolidated balance sheets, as the arrangement does not qualify for sale accounting under Accounting Standards Codification (“ASC”) 860.

As of March 31, 2025, future minimum payments required under the lease loan contract with Aviva Investor Infrastructure Income No.4 Ltd are:


	USD
	in thousands
2025 (April 1 through December 31)	$	742
2026		1,261
2027		1,261
2028		1,261
2029		1,261
Thereafter		38,233
Total minimum loan payments		44,019
Less: amount representing interest		(21,771)
Present value of net minimum loan payments	$	22,248

As of March 31, 2025, future principal repayments required under the Hungary subordination loan are:


	USD
	in thousands
2025 (April 1 through December 31)	$	1,092
2026		1,252
2027		1,214
2028		1,122
2029		1,086
Thereafter		9,251
Total	$	15,017

Financing associated with failed sales-leaseback transactions

Since 2017, certain subsidiaries of the Company (the “seller-lessee”) in China have sold solar projects assets (“leased assets”) to different domestic financial leasing companies (the “buyer-lessors”) for cash consideration, and simultaneously entered into the contracts to lease back the leased assets from the buyer-lessors for a typical period of 5 to 10 years. These arrangements are guaranteed by other subsidiaries of the Company and are also pledged by the shares and rights to the future power generation income of the seller-lessee. Pursuant to the terms of the agreements, the seller-lessee is required to make lease payments to the buyer-lessors over the lease period and is entitled to obtain ownership of the equipment at a nominal price upon the expiration of the lease.

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As the leased assets are considered integral with real estate under ASC 360, the sale-leaseback rules related to real estate are applied. The lease transactions do not qualify as a sale-leaseback transaction as these solar projects are initially invested and built up by the seller-lessee with expected useful life of 25 years and are continuously maintained by the seller-lessee. The seller-lessee has an obligation to repurchase the leased assets upon the expiry of the lease. In addition, after the lease period, the seller-lessee will keep using the assets and has no plans to sell or for early-disposal.

Accordingly, these transactions are accounted for as financing transactions in accordance with ASC 840. Internal rate of return is used in the computation of interest cost. The assets remain in the property, plant and equipment (“PPE”) and continue to be depreciated.

During the three months ended March 31, 2025 and 2024, the Company paid for amount of financing lease associated with failed sales-leaseback transactions of $1.2 million and $1.1 million, respectively. As of March 31, 2025 and December 31, 2024, the Company recorded $12.2 million and $12.5 million under failed sales-leaseback liabilities as the non-current portion and $4.2 million and $4.1 million as the current portion, which represents principal to be paid in the next year, respectively. The weighted average effective interest rate of the financing was 5.57% and 6.68% and interest costs incurred during the three months ended March 31, 2025 and 2024 were $0.2 million and $0.2 million, respectively. These failed sales-leaseback financings were collateralized by the underlying assets of the solar projects.

Finance lease

The Company leased module, inverter and other materials from different financial leasing companies in China. Pursuant to the terms of the contracts, the Company is required to make lease payments to the finance lease companies and is entitled to obtain the ownership of this machinery and equipment at a nominal price upon the expiration of the lease. These arrangements are guaranteed by other subsidiaries of the Company and are also pledged by the shares and rights for the future power generation income of the leased assets. The lease is classified as finance lease. As of March 31, 2025 and December 31, 2024, the carrying amount of leased assets are included in finance lease right-of-use assets, which are being depreciated over lives of 25 years. The payable related to these contracts as of March 31, 2025 and December 31, 2024 was $2.0 million and $2.3 million, respectively.

As of March 31, 2025, future minimum payments required under the finance lease are:


	USD
	in thousands
2025 (April 1 through December 31)	$	710
2026		752
2027		737
Total minimum lease payments		2,199
Less: amount representing interest		(157)
Present value of net minimum lease payments	$	2,042
Current portion	$	888
Non-current portion	$	1,154

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As of March 31, 2025, future minimum payments required under the failed sales-leaseback are:


	USD
	in thousands
2025 (April 1 through December 31)	$	3,754
2026		4,359
2027		3,940
2028		2,936
2029		1,865
Thereafter		1,335
Total minimum lease payments		18,189
Less: amount representing interest		(1,811)
Present value of net minimum lease payments	$	16,378
Current portion	$	4,158
Non-current portion	$	12,220


	March 31,		December 31,
	2025		2024

	in thousands
Current portion of finance lease	$	888	$	938
Current portion of failed sales-leaseback		4,158		4,076
Total current portion of failed sales-leaseback and finance lease	$	5,046	$	5,014

Non-current portion for finance lease	$	1,154	$	1,315
Non-current portion for failed sales-leaseback		12,220		12,452
Total non-current portion of failed sales-leaseback and finance lease	$	13,374	$	13,767

Interest expense

Interest expenses incurred for the three months ended March 31, 2025 and 2024 were $0.4 million and $0.4 million, respectively.

9. OTHER CURRENT LIABILITIES

The Company’s other current liabilities are summarized below:


	March 31,		December 31,
	2025		2024

	in thousands
Payables for purchase of property, plant and equipment ⁽¹⁾	$	12,144	$	12,272
Other tax payables		248		273
Deferred revenue ⁽³⁾		2,566		886
Others ⁽²⁾		4,129		6,400
Total other current liabilities	$	19,087	$	19,831

(1)	Payable for purchase of property, plant and equipment as of March 31, 2025 and December 31, 2024 included amounts payable to ReneSola Singapore Pte Ltd.’s subsidiaries.

(2)	Others as of March 31, 2025 and December 31, 2024 mainly includes the payables for claims, audit fees and other professional service fees.

(3)	Deferred revenue as of March 31, 2025 and December 31, 2024 is mainly related to Italy project.

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10. COMMON SHARES

On February 12, 2024, the Company announced that it approved an accelerated stock repurchase program (“ASR”) of up to $10 million. During 2024, the Company repurchased 33,988,150 of its ordinary shares, no par value at the cost of $7.2 million. No shares were repurchased during the first quarter of 2025. As of March 31, 2025, we have $0.9 million left under our repurchase plan. All repurchased shares under the repurchase program are classified as treasury shares of the Company until they are retired or reissued.

As of March 31, 2025 and December 31, 2024, the number of total issued shares of the Company was 637,920,142 shares and 652,821,742 shares, respectively.

During the three months ended March 31, 2025, the Company adjusted the reported number of issued common shares following a reconciliation of internal records related to a prior period. The adjustment reduced the number of issued shares. This change did not affect the number of shares outstanding, earnings per share, or any other component of the Company’s condensed consolidated financial statements. Accordingly, prior period financial statements have not been restated. If the reported number of issued common shares were adjusted as of December 31, 2024, the issued common shares would be 637,920,142 shares.

11. SHARE BASED COMPENSATION

2007 Share Incentive Plan

On September 27, 2007, the Company adopted the Emeren Group Ltd 2007 Share Incentive Plan (as amended, the “Plan”) that provides for grant of share options, restricted shares and restricted share units to employees in the Plan. A maximum of 7,500,000 authorized but unissued shares of the Company have been reserved and allocated to the Plan, whose shares were subsequently registered and are issuable upon exercise of outstanding options granted under the Plan. The Plan shall be administered by the Compensation Committee of the Board of Directors (the “Committee”). On July 27, 2010, the Company has amended the Plan so as to increase the maximum number of authorized but unissued shares of the Company to 12,500,000 in accordance with the rules of the 2007 Share Incentive Plan. On December 21, 2020, the Company has amended the Plan to increase the number of authorized but unissued shares of the Company to 22,500,000 in accordance with the rules of the 2007 Share Incentive Plan. On December 29, 2021, the Company has amended the Plan to increase the maximum number of authorized but unissued shares of the Company to 42,500,000 in accordance with the rules of the 2007 Share Incentive Plan.

Except as otherwise noted in the award agreements with the employee or consultant, the options can be exercised within six years from the award date, except for the participant’s termination of employment or service. The vesting schedule and the exercise price per share will be determined by the Committee and set forth in the individual award agreement. In the event of any distribution, share split, or recapitalization of the Company, the Committee shall make such proportionate and equitable adjustments, if any, to reflect such change with respect to (a) the aggregate number and type of shares that may be issued under the Plan and (b) the terms and conditions of any outstanding awards. Except as may otherwise be provided in any award agreement, if a change of control occurs and a participant’s awards are not converted, assumed, or replaced by a successor, such awards shall become fully exercisable and all forfeiture restrictions on such awards shall lapse.

Options to Employees

During the three months ended March 31, 2025, no options were granted to employees. During 2024, the Company granted 100,000 share options to certain employees with an exercise price of $0.26 on the grant date with expected vesting periods within three years.

Expected volatilities are based on the average of the standard deviation of the daily stock prices of the Company and other selected comparable companies in the same industry. The expected term of options represents the period of time that options granted are expected to be outstanding. The risk-free rate of return is based on the U.S. Treasury bond yield curve in effect at the time of grant for periods corresponding with the expected term of the option.

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A summary of the option activity is as follows:


				Weighted
				Average
		Weighted		Remaining	Aggregate
	Number of	Average		Contractual	Intrinsic
	Options	Exercise Prices		Term (in years)	Value
Outstanding on December 31, 2024	12,160,000	$	0.38	3.53	$	265,000
Granted	—		—			—
Exercised	—		—			—
Forfeited	(733,340)		0.30			—
Outstanding on March 31, 2025	11,426,660	$	0.38	3.38	$	35,000
Expected to vest at March 31, 2025	866,720		0.40	3.39		—
Exercisable at March 31, 2025	10,559,940	$	0.38	3.38	$	35,000

As of March 31, 2025, there were 11,426,660 outstanding options with a weighted average contractual period of 3.38 years under the Plan. As of December 31, 2024, there were 12,160,000 outstanding options with a weighted average contractual period of 3.53 years under the Plan.

Share-based compensation costs of $0.08 million and $0.03 million have been charged against income during the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, there was $0.05 million in total unrecognized share-based compensation expense related to unvested options granted under the Plan, which is expected to be recognized over a weighted-average period of 1 year.

As of March 31, 2025 and December 31, 2024, 500,000 ordinary shares of restricted share units were outstanding.

12. EMPLOYEE BENEFITS

North America

Emeren extends a 401(k) plan to eligible employees based in the United States. Through our 401(k) plan, eligible employees have the flexibility to defer up to 100% of their Plan Compensation on a pre-tax basis or opt for Voluntary Contributions, such as Roth contributions, on an after-tax basis. We ensure compliance with Internal Revenue Service (IRS) regulations, which stipulate limits on the amount an employee may defer under this plan or any other retirement plan allowing Elective Deferral Contributions during a calendar year. Emeren provides an Employer Match percentage formula, with vesting determined by the length of service with the Company.

Emeren has implemented a voluntary Registered Retirement Savings Plan (RRSP) tailored for eligible employees based in Canada. This initiative aims to empower our Canadian workforce in achieving their long-term financial objectives in a tax-efficient manner. Under the RRSP program, eligible employees immediately vest in the plan, ensuring immediate access to the benefits it offers. Moreover, the Company provides a structured Employer Match percentage formula, which depends on the percentage of earnings contributed by the employee.

In the fiscal year 2024, eligible employees based in the United States and Canada could enroll in the Company’s comprehensive supplemental benefits plans, comprised of health insurance, dental and vision coverage, life insurance, and a flexible spending account. Furthermore, the Company ensured full compliance with state, provincial, and federal laws and regulations, guaranteeing that all social benefits pertinent to North American employees were provided in accordance with applicable legal frameworks.

Europe

Emeren Group is committed to providing a comprehensive range of benefits to its employees in Europe, maintaining careful adherence to the framework of local laws and regulations governing social welfare. Across the majority of European countries, the cornerstone elements of the social benefit system encompass pension, healthcare, accident, and unemployment insurances. Eligibility criteria, utilization guidelines, and benefit amounts are dictated by relevant local legislation, ensuring compliance and equitable distribution. In alignment with statutory obligations, our company carefully fulfills the provision of all supplementary social benefits mandated by law in each respective country. Furthermore, beyond the statutory offerings, our company extends additional support through supplementary benefits, including private medical insurance, meal vouchers, and commuting allowances.

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China

In the fiscal year 2024, our operations in China continued to uphold our commitment to the welfare of our employees through participation in the benefit plans administered by the government of the People’s Republic of China (PRC). These plans encompass essential aspects such as pension, medical insurance, housing funds, unemployment, and workplace injury insurance, ensuring comprehensive coverage for our workforce.

Both the Company and our employees actively contribute to these plans, with the Company assuming the responsibility of withholding the employees’ portion from their salaries and remitting the contributions to the local government on a monthly basis.

13. EARNINGS (LOSS) PER ADS

Basic and diluted earnings per ADS have been calculated as follows:


	Three months ended March 31,
	2025		2024

	in thousands, except number of shares and per share amounts
Numerator:
Net income (loss)	$	1,479	$	(5,488)
Less: net (loss) income attributed to non-controlling interests		(61)		437
Total net income (loss) attributed to Emeren Group Ltd	$	1,540	$	(5,925)

Numerator for diluted income (loss) per ADS	$	1,540	$	(5,925)

Denominator:
Denominator for basic income (loss) per ADS - weighted average number of ADS outstanding*		51,321,622		53,553,650
Dilutive effects of share options*		70,979		—
Denominator for diluted calculation - weighted average number of ADS outstanding*		51,392,601		53,553,650

Basic income (loss) per ADS	$	0.03	$	(0.11)
Diluted income (loss) per ADS	$	0.03	$	(0.11)

*	All shares are converted to ADS, each ADS represents 10 common shares

The Company issues ordinary shares to its share depository bank which will be used to settle stock option awards upon their exercise. Any ordinary shares not used in the settlement of stock option awards will be returned to the Company. As of March 31, 2025 and December 31, 2024, 9,396,480 ordinary shares were legally issued to the share depository bank but are treated as escrowed shares for accounting purposes and therefore, have been excluded from the computation of earnings (loss) per ADS.

The Company uses the treasury method in determining whether those potential common shares are dilutive or antidilutive. That is, the number of potential common shares, after considering the shares repurchased used in computing the diluted per-share amount for income (loss). For the three months ended March 31, 2024, the Company excluded ordinary share equivalents of 1,323,530 from the computation of diluted net earnings (loss) per share because including them would have been anti-dilutive.

14. NON-CONTROLLING INTEREST

During the three months ended March 31, 2025 and 2024, the Company has comprehensive income (loss) attributed to non-controlling interest for $0.1 million and ($0.2) million, respectively, of which, the majority resulted from consolidated entities, Powerminds Storage S.r.l., RPNC Holdings, LLC and Zhejiang Emeren Smart Energy Co., Ltd for the three months ended March 31, 2025; and RPNC Holdings, LLC and Zhejiang Emeren Smart Energy Co., Ltd for the three months ended March 31, 2024. The Company calculated the non-controlling interest for 45.0% to Powerminds Storage S.r.l., 99% to RPNC Holdings, LLC and 40.13% to Zhejiang Emeren Smart Energy Co., Ltd.

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15. RELATED PARTY BALANCES AND TRANSACTIONS

(a) Related party balances

As of March 31, 2025 and December 31, 2024, related party balances consist of amounts due to related party amounting of $3.4 million and $4.0 million, respectively. These were mainly convertible bond issued to Eiffel Investment Group for solar power development purpose and included the outstanding service cost that minority controllers of Gravel A provided to the Company.

(b) Related party transactions

Related party transactions were as follows:


	Three months ended March 31,
	2025		2024

	in thousands
Interest expense ⁽¹⁾	$	11	$	10
Payment for service ⁽²⁾		1,177		506
Payable to related party services ⁽³⁾		336		1,471

(1)

Represents the convertible bond issued to Eiffel Investment Group up to EUR 7.03 million ($8.0 million) with an annual interest rate of 2%. The bond has a maturity date of September 2031. During the convertible period and when there is an Event of Default and Acceleration Event (failure to redeem, a material misrepresentation by the Company, or misuse of the proceeds), the bond holder shall have the right to convert the issued convertible bonds at the conversion price into shares of European Solar Energy Development JV (“the Issuer”). The conversion price is determined as per evaluation equal to 70% of the purchase price of the shares. The Company accounts for convertible bond as a single debt instrument at amortized cost. As of March 31, 2025 and December 31, 2024, the outstanding convertible bond was $2.5 million (EUR 2.3 million) and $2.4 million (EUR 2.3 million), respectively.

(2)	Represents the amount that the Company paid in cash to minority shareholders of Gravel A for settling historical payable balance.

(3)	Transactions during the three months ended March 31, 2025 and 2024, which represents the payable amount of Gravel A to Enerpoint and Kaizen for project services regarding Italy projects.

16. COMMITMENTS AND CONTINGENCIES

Operating lease accounting

The Company leases rooftop, land, other property, and equipment under non-cancellable operating leases whose initial terms are typically 3 to 25 years, with some having a term of 40 years or more, along with options that permit renewals for additional periods. At the inception of each lease, the Company determines if the arrangement is a lease or contains an embedded lease and reviews the facts and circumstances of the arrangement to classify leased assets as operating or finance under Topic 842. The Company has elected not to record any leases with terms of 12 months or less on the balance sheet.

As this time, a certain portion of active leases within the Company portfolio are classified as operating leases under the new standard. Operating leases are included in Rights-of-Use (“ROU”) assets, operating lease liabilities, current, and operating lease liabilities, non-current in the condensed consolidated balance sheets. The ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent our obligation to make minimum lease payment arising from the lease for the duration of the lease term.

Most leases include one or more options to renew, with renewal terms that can extend the lease term from 1 year to 5 years or greater. The exercise of the lease renewal option is typically at our discretion. Additionally, many leases contain early termination clauses, however early termination typically requires the agreement of both parties to the lease. At the lease inception, all renewal options reasonably certain to be exercised are considered when determining the lease term. At this time, the Company does not have operating leases that include options to purchase or automatically transfer ownership of the lease property to the Company. The depreciable life of leased assets is limited by the expected lease term.

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To determine the present value of future minimum lease payments, the Company uses the implicit rate when readily determinable. At this time, many of the Company’s leases do not provide an implicit rate, therefore, to determine the present value of minimum lease payments, the Company uses its incremental borrowing rate based on the information available at lease commencement date. The ROU assets also include any lease payments made and exclude lease incentives.

The components of lease expenses consisted of the following:


		Three months ended March 31,
Lease cost	Classification	2025		2024

		in thousands
Operating lease cost	Operating expenses: General and administrative	$	606	$	498
Short-term lease cost	Operating expenses: General and administrative		77		—
Sublease income	Other operating expenses, net		(22)		—
Net lease cost		$	661	$	498


Lease Term and Discount Rate	March 31, 2025		December 31, 2024
Weighted-average remaining lease term (years)
Operating leases	22.6	years	22.6	years
Weighted-average discount rate (%)
Operating leases	6.14	%	6.15	%


	Three months ended March 31,
Other information	2025		2024

	in thousands
Cash paid for amount included in the measurement of lease liabilities
Operating cash flows from operating leases	$	607	$	454
Cash paid for short-term leases	$	77	$	—

As of March 31, 2025, future minimum payments required under the operating lease are:


	USD
	in thousands
2025 (April 1 through December 31)	$	1,085
2026		1,835
2027		1,908
2028		1,315
2029		1,705
Thereafter		30,181
Total minimum lease payments		38,029
Less: amount representing interest		(18,095)
Present value of net minimum lease payments	$	19,934
Current portion	$	557
Non-current potion	$	19,377

Capital commitments

As of March 31, 2025 and December 31, 2024, the Company had capital commitments of approximately $1.6 million and $2.4 million, respectively. These capital commitments were solely related to contracts signed with vendors for procurement of services or photovoltaic (PV) related products used for the construction of solar PV systems being developed by the Company.

The capital commitments as at balance sheet date disclosed above do not include those incomplete purchases or acquisitions as at balance sheet dates as the agreements could either be terminated unconditionally without any penalty or cancelable when the closing conditions as specified in the agreements could not be met.

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Legal matters

In the ordinary course of business, the Company may be subject to legal proceedings regarding contractual and employment relationships and a variety of other matters. The Company records contingent liabilities resulting from such claims, when a loss is assessed to be probable and the amount of the loss is reasonably estimable.

The Company is a party to legal matters and claims in the normal course of its operations. While the Company believes that the ultimate outcome of these matters will not have a material adverse effect on its financial position, results of operations or cash flows, the outcome of these matters is not determinable with certainty and negative outcomes may adversely affect the Company.

17. SEGMENT REPORTING

The Company separated the solar power project segment into four reportable segments, including solar power project development, EPC services, electricity generation and DSA. Ancillary revenues and expenses and other unallocated costs and expenses are recorded in other.

The following table summarizes the Company’s revenues generated from each segment:


	Three months ended March 31, 2025
	Solar power project		Electricity		EPC
	development		generation		services		DSA		Others		Total

	in thousands
Net revenue	$	317	$	6,701	$	—	$	1,104	$	32	$	8,154
Less: cost of revenue		189		3,854		110		782		10		4,945
Gross profit (loss)	$	128	$	2,847	$	(110)	$	322	$	22	$	3,209


	Three months ended March 31, 2024
	Solar power project		Electricity		EPC
	development		generation		services		DSA		Others		Total

	in thousands
Net revenue	$	—	$	5,384	$	4,137	$	5,062	$	17	$	14,600
Less: cost of revenue		—		2,883		3,728		3,667		—		10,278
Gross profit	$	—	$	2,501	$	409	$	1,395	$	17	$	4,322

The following table summarizes the Company’s revenues generated by the geographic location of customers:


	Three months ended March 31,
	2025		2024

	in thousands
China	$	3,393	$	2,881
United States		349		407
UK		2,492		2,097
France		147		1
Poland		32		2,460
Italy		1,104		5,062
Hungary		637		1,692
Total	$	8,154	$	14,600

18. SUBSEQUENT EVENTS

The Company has evaluated subsequent events through the date of issuance of the unaudited condensed consolidated financial statements. There were no other subsequent events occurred that would require recognition or disclosure in the unaudited condensed consolidated financial statements.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations together with the unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and with our audited condensed consolidated financial statements and related notes included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on March 25, 2025, as amended by the Annual Report on Form 10-K/A filed with the SEC on March 26, 2025 and the Annual Report on Form 10-K/A filed with the SEC on April 22, 2025 (together, the “Annual Report on Form 10-K”), and related management’s discussion and analysis in Item 7 of the Annual Report on Form 10-K. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those discussed below. Factors that could cause or contribute to such differences include those identified below and those discussed in the section titled “Risk Factors” included in our Annual Report on Form 10-K. Please also see the section herein titled “Forward-Looking Statements.”

Overview

During the first quarter of 2025, we had $8.2 million in revenue, $3.2 million in gross profit, a 39.4% gross margin and $4.1 million loss from operations. An unrealized foreign exchange gain due to the strengthening of the Euro positively impacted net income by approximately $6.2 million, resulting in a net income of $1.5 million.

Gross profit and gross margin are influenced by various factors, including the relative performance and contribution of our business segments, the impact of tariffs, and the timing and pricing of project sales. As a result of these dynamics, our gross margin varies from period to period. Our IPP and DSA businesses remained strong, continuing to drive high-margin revenue.

Project Pipeline

Advanced-Stage and Early-Stage Solar Development Project Pipeline (in Megawatts)

Project pipeline by region representing the gross MW size of the projects owned by us and our non-controlling interest, as of March 31, 2025:


	Advanced	Early	Total
Region	Stage	Stage	(MW)
Europe	1,259	3,257	4,516
U.S.	887	496	1,383
China	22	—	22
Total	2,168	3,753	5,921

Project pipeline by region representing the development services agreements developed by us, as of March 31, 2025:


	Advanced	Early	Total
Region	Stage	Stage ⁽²⁾	(MW)
Europe	185	594	779
U.S.	46	797	843
Total	231	1,391	1,622

Advanced-Stage and Early-Stage Solar Storage Project Pipeline (in Megawatts)

Project pipeline by region representing the gross MW size of the projects owned by us and our non-controlling interest, as of March 31, 2025:


	Advanced	Early	Total
Region	Stage	Stage	(MW) ⁽¹⁾
Europe	1,691	1,862	3,553
U.S.	993	135	1,128
China	31	—	31
Total	2,715	1,997	4,712

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Project pipeline by region representing the development services agreements developed by us, as of March 31, 2025:


	Advanced	Early	Total
Region	Stage	Stage ⁽²⁾	(MW) ⁽¹⁾
Europe	1,831	1,498	3,329
U.S.	112	922	1,034
Total	1,943	2,420	4,363

(1)	The average hours per MW vary across regions. For example, in the U.S. and Europe, it ranged from 4 - 8 hours per MW of storage, while in China, it was ~2 hours.

(2)	A substantial portion of early-stage DSA projects remain owned by the Company as of March 31, 2025, and may be sold or transferred upon achieving project milestones.

Growing IPP Asset Portfolio in Attractive Power Purchase Agreement (PPA) Regions

As of March 31, 2025, we owned and operated IPP assets comprising ~293 MW of solar PV projects and 61 MWh of storage.


	PV Capacity	Storage
Operating Assets*	(MW)	(MWh)
China DG	167	61
Europe	102	—
U.S.	24	—
Total	~293	61

*	Some of these assets could be sold as project assets in the next 6 to 12 months.

Net Revenue

We are a solar/storage project developer and operator, with our revenues mainly generated from our solar/storage power projects. Set forth below is the breakdown of our net revenue and gross profit (loss) by segment.

The Company has the following reportable segments, including solar/storage power project development, EPC services, electricity generation and DSA. Ancillary revenues and expenses and other unallocated costs and expenses are recorded in others.


	Three months ended March 31, 2025
	Solar power project		Electricity		EPC
	development		generation^(a)		Services		DSA		Others		Total

	in thousands
Net revenue	$	317	$	6,701	$	—	$	1,104	$	32	$	8,154
Gross profit (loss)	$	128	$	2,847	$	(110)	$	322	$	22	$	3,209


	Three months ended March 31, 2024
	Solar power project		Electricity		EPC
	development		generation^(a)		services		DSA		Others		Total

	in thousands
Net revenue	$	—	$	5,384	$	4,137	$	5,062	$	17	$	14,600
Gross profit	$	—	$	2,501	$	409	$	1,395	$	17	$	4,322

(a)

The weighted-average capacity factors can vary based on seasonality and weather. Changes in climate, geography, weather patterns, and other phenomena in the regions where we operate may significantly affect our business. As a result, our IPP electricity production and amount of electricity sold and therefore our IPP revenue tend to be higher during periods or seasons when there is more irradiation.

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Geographical Distribution

We are a solar project developer and operator and function as a pure downstream player with a pipeline of projects around the world.

The following table summarizes the Company’s revenues generated by the geographic location of customers:


	Three months ended March 31,
	2025		2024

	in thousands
China	$	3,393	$	2,881
United States		349		407
UK		2,492		2,097
France		147		1
Poland		32		2,460
Italy		1,104		5,062
Hungary		637		1,692
Total	$	8,154	$	14,600

We expect the revenue from solar/storage power project to increase generally in parallel with our business growth.

Cost of Revenue

Our cost of revenue for continuing operations consists of costs for:

development costs (including interconnection fees and permitting costs) of solar/storage power projects;

acquisition costs of solar/storage power projects, if applicable;

project management costs;

EPC costs (consisting of costs of the components of solar/storage power projects other than solar modules, such as inverters, electrical and mounting hardware, trackers, grid interconnection equipment, wiring and other devices);

overhead allocation cost (including utilities, maintenance and other support expenses);

interest costs capitalized for solar/storage power projects during construction period; and

site-specific costs

Gross Margin

Our gross margin is affected by changes in our net revenue and cost of revenue. Gross margin is affected by 1) the gross margin of each individual solar/storage power project we sell, which is determined by our ability to negotiate the sales price and our ability to effectively control the project acquisition and development costs, 2) the gross margin of each individual solar/storage power project we operate, which is determined by revenues from the sale of electricity generated from our operated solar/storage power projects and our ability to effectively control the operation costs, and 3) the gross margin of each individual EPC service we provide, which is determined by our ability to negotiate the sales price and our ability to effectively control the engineering, procurement and construction costs.

Our gross margin increased to 39.4% in the three months ended March 31, 2025 from 29.6% in the three months ended March 31, 2024 primarily due to the increase in favorable margin within the electricity generation segment, which benefited from improved weather conditions and higher solar irradiation levels.

Operating Expenses

Our operating expenses primarily include sales and marketing expenses, general and administrative expenses and other operating income and expenses and impairment loss of assets.

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Sales and Marketing Expenses

Sales and marketing expenses consist primarily of salaries, bonuses and pensions for our sales personnel, commission paid to our sales agents, outbound freight, share-based compensation expenses and benefits, travel and other sales and marketing expenses.

General and Administrative Expenses

General and administrative expenses consist primarily of salaries, bonuses and benefits for our administrative and management personnel, consulting and professional service fees, bad debt provision, and travel and related costs incurred by our administrative and management personnel.

Other Operating Income and Expenses

Other operating income (expenses) primarily consist of cancellation loss of project assets, disposal gain (loss) of property, plant and equipment and non FIT payments.

Other Income and Expenses

Our other income and expenses consist primarily of interest income, interest expenses, foreign currency exchange gains or losses and investment gain or loss.

Our interest income represents interest on our cash balances and the recognition of the discounted interest income on the feed-in tariff(s) (FIT) for the electricity sold. Our interest expenses relate primarily to our short-term and long-term borrowings from banks and other financing parties, less capitalized interest expenses to the extent they relate to our capital expenditures.

Our foreign currency exchange gain or loss results from our net exchange gains and losses on our monetary assets and liabilities denominated in foreign currencies during the relevant period. Our functional currency is the U.S. dollar. The functional currency for our subsidiaries in the PRC is Renminbi (“CNY”). The functional currency of our overseas subsidiaries normally is the local currency of the country where the subsidiary is domiciled. Foreign currency transactions have been translated into the functional currency at the exchange rate prevailing on the date of the transaction. Foreign currency denominated monetary assets and liabilities are translated into our functional currency at exchange rates prevailing on the balance sheet date. Our reporting currency is the U.S. dollar. Assets and liabilities have been translated using exchange rates prevailing on the balance sheet date. Income statement items have been translated using the weighted average exchange rate and equity is translated at historical exchange rates, except for the change in retained earnings during the period which is the result of the income or loss.

Taxation

Under the current laws of the British Virgin Islands, we are not subject to any income or capital gains tax. Additionally, dividend payments made by us are not subject to any withholding tax in the British Virgin Islands.

In 2025 and 2024, we had overseas operations in the jurisdiction of the United States, the United Kingdom, Poland, Hungary, Spain, France, Germany, Italy, Luxembourg and China. The corporate income tax rates in these jurisdictions range from 0% to 30.2%.

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Segment Operations

We currently separate our business into four reportable segments, including solar/storage power project development, electricity generation, EPC services and DSA. Ancillary revenues and expenses and other unallocated costs and expenses are recorded in others.

Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with U.S. GAAP. U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. In many instances, we could have reasonably used different accounting estimates, and in other instances, changes in the accounting estimates are reasonably likely to occur from period-to-period. Actual results could differ significantly from our estimates. Our future financial statements will be affected to the extent that our actual results materially differ from these estimates.

There were no significant changes in the Company’s significant accounting policies during the three months ended March 31, 2025 from those disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Recent Accounting Pronouncements

A discussion of recently issued accounting standards applicable to the Company is described in Note 2, “Summary of Significant Accounting Policies”, in the accompanying notes to the unaudited condensed consolidated financial statements.

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Results of Operations

The following table sets forth our unaudited statements of operations data for the three months ended March 31, 2025 and 2024. We have derived this data from our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. This information should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q. The results of historical periods are not necessarily indicative of the results of operations for any future period.


	Three Months Ended March 31,
	2025		2024

	(In thousands, except share and per share amounts)
Net revenues:
Solar power project development	$	317	$	—
Electricity generation		6,701		5,384
EPC services		—		4,137
DSA		1,104		5,062
Others		32		17
Total net revenues		8,154		14,600
Cost of revenues		(4,945)		(10,278)
Gross profit		3,209		4,322


Operating expenses:
Sales and marketing		(37)		(61)
General and administrative		(4,479)		(4,622)
Other operating expenses, net		(2,791)		(852)
Total operating expenses		(7,307)		(5,535)

Loss from operations		(4,098)		(1,213)

Other income (expenses):
Interest income		416		520
Interest expense		(379)		(385)
Unrealized foreign exchange gains (losses)		6,198		(3,253)
Total other income (expenses), net		6,235		(3,118)

Income (loss) before income tax		2,137		(4,331)
Income tax expense		(658)		(1,157)

Net income (loss)		1,479		(5,488)
Less: Net (loss) income attributed to non-controlling interests		(61)		437
Net income (loss) attributed to Emeren Group Ltd	$	1,540	$	(5,925)

Income (loss) attributed to Emeren Group Ltd per ADS*
Basic	$	0.03	$	(0.11)
Diluted	$	0.03	$	(0.11)
Weighted average number of ADS* used in computing income (loss) per ADS*
Basic		51,321,622		53,553,650
Diluted		51,392,601		53,553,650

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Three Months Ended March 31, 2025 Compared to Three Months Ended March 31, 2024

Net Revenue. Our net revenue decreased from $14.6 million in the three months ended March 31, 2024 to $8.2 million in the three months ended March 31, 2025 primarily due to (i) revenue from EPC services decreased by $4.1 million; (ii) revenue from DSA decreased by $3.9 million; offset by (iii) revenue from electricity generation increased by $1.3 million and (iv) revenue from solar power project development increased by $0.3 million. The decrease in EPC services revenue was driven by the Company’s strategy in prioritizing DSA revenue since 2024. The decrease in DSA revenue was primarily due to delays in achieving project milestones and completions, as several projects in the U.S. and Europe regions experienced permitting delays that pushed expected revenue recognition beyond the current reporting period. Additionally, economic and policy uncertainties led to lower buyer pricing, reducing revenue recognized during the period.

Cost of Revenue. Our cost of revenue decreased from $10.3 million in the three months ended March 31, 2024 to $4.9 million in the three months ended March 31, 2025. Our cost of revenue associated with solar power project primarily consists of project development cost and acquisition cost; cost on electricity generation primarily consists of depreciation expenses arising from our solar power fixed assets and EPC cost associated with direct materials, solar modules, labor, subcontractor costs, and other indirect costs related to contract performance, such as indirect labor and supplies. The decrease of our cost of revenue is primarily due to the decrease in net revenue.

Gross Profit. Gross profit for the three months ended March 31, 2025 was $3.2 million, compared to a gross profit of $4.3 million in the three months ended March 31, 2024. Despite the decrease in gross profit, gross margin increased to 39.4% for the three months ended March 31, 2025 from 29.6% for the same period in 2024. The increase in gross margin was primarily driven by the favorable margin contribution from revenue generated through electricity generation segment, which benefited from improved weather conditions and higher solar irradiation levels.

Sales and Marketing Expenses. Sales and marketing expenses was $0.1 million in the three months ended March 31, 2024 and $0.04 million in the three months ended March 31, 2025.

General and Administrative Expenses. General and administrative expenses decreased from $4.6 million in the three months ended March 31, 2024 to $4.5 million in the three months ended March 31, 2025. The decrease was mainly from a reduction in credit losses by $0.3 million and decrease in professional services fees by $0.3 million. The decreases were partially offset by an increase in payroll by $0.4 million attributable in part to market rate adjustments and an increase in other management-related expenses by $0.1 million.

Other Operating Income (Expenses), Net. Other operating expense increased from $0.9 million in the three months ended March 31, 2024 to $2.8 million in the three months ended March 31, 2025. Our other operating income (expenses) consisted primarily of cancellation loss of project assets and disposal gain or loss in property, plant and equipment. Project cancellations were based on case-by-case assessments of development status, expected returns, and commercial feasibility in the first quarter of 2025, following a change in management’s strategic review of the project portfolio.

Interest Income and Expenses. Our interest income decreased from $0.5 million in the three months ended March 31, 2024 to $0.4 million in the three months ended March 31, 2025, primarily due to decrease in interest income received from cash deposits. Our interest expenses were unchanged from $0.4 million in the three months ended March 31, 2024 to $0.4 million in the three months ended March 31, 2025.

Unrealized Foreign Exchange Gains (Losses). Unrealized foreign exchange loss was $3.3 million in the three months ended March 31, 2024 and unrealized foreign exchange gain was $6.2 million in the three months ended March 31, 2025, primarily due to the strengthening of the Euro during the three months ended March 31, 2025.

Income Tax Expense. Income tax expense decreased from $1.2 million in the three months ended March 31, 2024 to $0.7 million in the three months ended March 31, 2025. The decrease was primarily due to lower taxable income in Hungary resulting from a decline in revenue. The income tax expense in the three months ended March 31, 2025 mainly resulted from the taxable income from the UK and Italy.

Net income (loss). We had a net income of $1.5 million in the three months ended March 31, 2025, compared to net loss of $5.5 million in the three months ended March 31, 2024, primarily as a result of the unrealized foreign exchange gain during the first quarter of 2025.

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Liquidity and Capital Resources

For the three months ended March 31, 2025, we had generated negative operating cash flow of $1.9 million, a loss from operations of $4.1 million and we repaid borrowings, finance lease and failed sales-leaseback financing totaling of $2.7 million. As of March 31, 2025, we have positive working capital of $148.1 million. We believe that our cash and cash equivalents, project assets, and continued support from financial institutions, fund investors and financing lease companies, in the form of renewed and additional short-term or long-term financings (including development loans, construction loans and project financings) and equity contribution, will be sufficient to meet our working capital and capital expenditure needs that will arise in 2025 and will be sufficient for at the least the next 12 months from the issuance date of this quarterly report. We intend to continue to carefully execute our operating plans and manage credit and market risk. However, if our financial results or operating plans change from our current assumptions, our liquidity could be negatively impacted.

As part of our financing policy, we expect to continue to finance our liquidity needs mainly with cash flows from our operating activities. We continuously evaluate opportunities to pursue acquisitions or engage in strategic transactions. We expect to finance any significant future transaction with a combination of cash, long-term indebtedness and the issuance of shares of our company.

As of March 31, 2025, significant components of our working capital were as follows:

●

Our total current assets were $197.1 million, including cash and cash equivalents of $52.9 million.

●

Total current liabilities were $49.0 million.

●

We had current project assets of $50.6 million in our late stage projects under development. Although we believe we will be able to sell such project assets at a profit, if we are unable to sell these project assets at reasonable prices in the near term, our liquidity may be negatively affected.

Cash generated from operations, external financing, and related party credit are our primary sources of operating liquidity, and we believe that cash flows from operations combined with our existing cash and cash equivalents, and facilities currently available, and those expected to be renewed will be sufficient to satisfy our obligations when they become due.

Borrowings

Short-term borrowings

As of March 31, 2025, all the short-term borrowings have been fully repaid and there were no new short-term borrowings.

Long-term borrowings

In January 2021, the Company’s UK subsidiary obtained a long-term loan from a lender in the UK totaling £0.05 million ($0.06 million). The long-term loan has a maturity date of July 2026 with an annual interest rate of 2.5%. The proceeds from this loan were used for general working capital purposes. The long-term borrowing was interest free for twelve months. As of March 31, 2025, the balance of this long-term borrowing was $0.02 million.

In January 2022, the Company’s Project Branston subsidiary entered into a lease loan contract with Aviva Investor Infrastructure Income No. 4 Ltd. The loan bears interest at 4% above the base rate time to time from Lloyds Bank Plc on the bank and will mature in April 2060. As a result of the acquisition of Branston, the Company took over the loan. As of March 31, 2025, the long-term borrowings were $22.2 million including current of $0.4 million and non-current of $21.8 million.

In February 2023, the Company’s Tensol 3 subsidiary entered into a shareholder loan contract with a minority shareholder of a subsidiary of the Company, Tensol 3, of $0.7 million. The loan bears interest at 2% per annum and will mature in December 2025. As of March 31, 2025, the balance of the shareholder loan was $0.03 million.

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In November 2023, the Company’s China subsidiary obtained a long-term bank loan in the RMB totaling RMB 1.3 million ($0.2 million). The long-term loan bears interest at 5.2% above the base rate time to time from Loan Prime Rate on the bank and will mature in November 2033. As of March 31, 2025, the long-term borrowings were $0.2 million, including current of $0.02 million and non-current of $0.1 million.

The long-term loans obtained by the Company’s China subsidiary in November 2023, March 2024, and July 2024 are guaranteed by another subsidiary of the Company. These loans are also collateralized by the underlying assets of solar projects with a carrying amount of $3.2 million (RMB 23.5 million), as well as a 100% equity interest in a subsidiary and the rights to the future power generation income. The accounts receivable related to electricity generation revenue in China remain on the Company’s condensed consolidated balance sheet, as the transaction is accounted for as a secured borrowing under ASC 860. The Company continues to collect customer payments for the pledged accounts receivable.

Contractual Obligations

For more information on our contractual obligations, commitments and contingencies, see Notes 8 and 16 to the unaudited condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report Form 10-Q.

Cash Flows For The Three Months Ended March 31, 2025 and 2024

The following table summarizes the Company’s cash flows from operating, investing, and financing activities for the three months ended March 31, 2025 and 2024:


	Three Months Ended March 31,
	2025		2024

	(in thousands)
Net cash used in operating activities	$	(1,892)	$	(6,788)
Net cash used in investing activities		(2,102)		(2,607)
Net cash provided by (used in) financing activities		13,244		(8,187)
Net increase (decrease) in cash, cash equivalents and restricted cash		3,575		(15,101)

Cash Flows from Operating Activities

The decrease in net cash used in operating activities by $4.9 million was mainly attributable to the net income for the first quarter of 2025 of $1.5 million, adjustment to cash flows from operating activities due to loss on cancellation of project assets of $2.7 million, increase in cash inflows from project assets by $7.0 million, offset by an unfavorable turnover of accounts receivable, trade and unbilled by $7.9 million and increase in cash outflows from accounts payable by $3.4 million.

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Cash Flows from Investing Activities

The decrease in net cash used in investing activities by $0.5 million was mainly attributable to the decrease in the purchases of property, plant and equipment by $0.2 million and increase in proceeds from disposals of property, plant and equipment by $0.3 million.

Cash Flows from Financing Activities

The increase in net cash provided by financing activities by $21.4 million was mainly attributable to the decrease in repurchase of shares by $6.2 million and increase in proceeds from banks and other third-party borrowings by $14.5 million.

Off Balance Sheet Arrangements

As of the date of this Quarterly Report on Form 10-Q, the Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that are material to investors. The term “off-balance sheet arrangement” generally means any transaction, agreement, or other contractual arrangement to which an entity unconsolidated with the Company is a party, under which it has any obligation arising under a guaranteed contract, derivative instrument, or variable interest or a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity, or market risk support for such assets.

Currently, the Company does not engage in off-balance sheet financing arrangements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable to smaller reporting companies.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (“Disclosure Controls”) within the meaning of Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”). Our Disclosure Controls are designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act, such as this Quarterly Report on Form 10-Q, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Our Disclosure Controls are also designed to ensure that such information is accumulated and communicated to our management, including our Interim Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

In designing and evaluating our Disclosure Controls, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily applied its judgment in evaluating and implementing possible controls and procedures.

As of the end of the period covered by this Quarterly Report on Form 10-Q, we evaluated the effectiveness of the design and operation of our Disclosure Controls, which was done under the supervision and with the participation of our management, including our Interim Chief Executive Officer and our Chief Financial Officer. Based on the evaluation of our Disclosure Controls, our Interim Chief Executive Officer and Chief Financial Officer have concluded that, as of March 31, 2025, our Disclosure Controls were effective.

Changes in Internal Control over Financial Reporting

There were no other changes in our internal control over financial reporting that occurred during the three months ended March 31, 2025, to which this report relates, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The information with respect to legal proceedings is set forth under Note 16 - Commitments and Contingencies, in the accompanying unaudited condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q, and is incorporated herein by reference.

ITEM 1A. RISK FACTORS

Our risk factors have not changed materially from those risks disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024 in Item 1A. “Risk Factors,” other than as set forth below. Our business, financial condition, and results of operations could be materially and adversely affected by any of these risks or uncertainties.

Reciprocal tariffs under the International Emergency Economic Powers Act on imports into the United States could adversely affect us.

On February 1, 2025, the U.S. government issued an Executive Order pursuant to the International Emergency Economic Powers Act (the “IEEPA”) imposing a 10% tariff on all imports from China, effective February 4, 2025. On March 3, 2025, the U.S. government amended the Executive Order increasing the tariff to 20%, effective March 4, 2025. The 20% tariff applies in addition to any other duties, fees, exactions, and charges applicable to the covered imports from China.

On April 2, 2025, the U.S. government issued an Executive Order pursuant to IEEPA imposing an indefinite reciprocal 10% tariff on almost all goods imported into the U.S., effective April 5, 2025, and individualized higher IEEPA tariffs (11% to 50%) starting April 9, 2025 on goods originating from 57 countries with trade surpluses with the U.S., including China, among other countries. On April 9, 2025, the U.S. government issued a further Executive Order increasing the IEEPA reciprocal tariff on China to 125% effective April 10, 2025. Concurrently, the U.S. government announced a temporary suspension of the country-specific reciprocal tariff measures targeting most U.S. trading partners for a 90-day period, or until July 9, 2025. This sequence of actions underscored a strategic recalibration of the U.S. trade policy, emphasizing heightened pressure on international trade.

We are closely monitoring potential changes in international trade policy and the evolving trade environment, as it remains unclear what additional actions, if any, will be taken by the U.S. or other governments with respect to international trade agreements, the imposition of tariffs on goods imported into the U.S., tax policy related to international commerce, or other trade matters. The recent tariff measures have introduced increased uncertainty and complexity in our supply chain planning and cost management. At this time, we cannot predict full impact of these measures; however, any sustained or escalated trade restrictions could adversely affect our business, financial condition, or results of operations. If any new tariffs, legislation and/or regulations are implemented, or if existing trade agreements are renegotiated or, in particular, if the U.S. government takes retaliatory trade actions due to the recent U.S.-China trade tension, such changes could have an adverse effect on our business, financial condition and results of operations.

Our recent CEO transition may adversely affect our business, operations, and strategic initiatives.

On April 30, 2025, our former Chief Executive Officer (“CEO”) stepped down from his role, and the Board of Directors (“Board”) appointed an interim CEO while it conducts a search for a permanent replacement. Any failure to successfully transition key executive roles could impair our ability to execute on our strategic initiatives, meet performance goals, and maintain operational continuity. Additionally, uncertainty surrounding the leadership transition may negatively impact employee morale and retention, customer confidence, and supplier relationships. There is no assurance that the Board will identify and appoint a permanent CEO in a timely manner. Prolonged uncertainty or a perceived lack of leadership stability could adversely affect our business, financial condition, results of operations, cash flows, and stock price.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Registered Equity Securities

As of December 2021, the Board authorized the Company to repurchase up to $50 million of shares, which authorization does not expire (the “repurchase plan”). In February 2024, we announced that our Board of Directors approved, under the repurchase plan, an accelerated stock repurchase (ASR) program of up to $10 million, which does not expire. This accelerated stock repurchase program underscores the Board’s commitment to our shareholders and confidence in the Company’s future growth. No shares were repurchased during the first quarter of 2025. As of March 31, 2025, we have $0.9 million left under our repurchase plan.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

(c) Rule 10b5-1(c) and Non-Rule 10b5-1 Trading Arrangements

During the three months ended March 31, 2025, no director or officer of the Company adopted, modified, or terminated any contract, instruction, or written plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any non-Rule 10b5-1 trading arrangement.

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ITEM 6. EXHIBITS

Exhibit Number		Exhibit Description
31.1*		Certification of Interim Principal Executive Officer pursuant to Rule 13a-14 and Rule 15d-14(a), promulgated under the Securities and Exchange Act of 1934, as amended.
31.2*		Certification of Principal Financial Officer pursuant to Rule 13a-14 and Rule 15d-14(a), promulgated under the Securities and Exchange Act of 1934, as amended.
32.1*		Certification of Interim Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data file because its XBRL tags are embedded within the Inline XBRL document
101.SCH*		Inline XBRL Taxonomy Extension Schema Document
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104*		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

*Filed herewith

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Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized on May 13, 2025.

	Emeren Group Ltd

Date: May 13, 2025	By:	/s/ Julia Xu
		Julia Xu
		Interim Chief Executive Officer

Date: May 13, 2025	By:	/s/ Ke Chen
		Ke Chen
		Chief Financial Officer