SunPower announced plans to reduce its workforce and restructure certain business segments in an effort to lower costs. This decision caused the solar company’s shares to drop 16% in premarket trading. The company will be letting go of about 1,000 employees in the near future, as well as closing its SunPower Residential Installation locations and SunPower Direct sales.
As a result of these changes, SunPower expects to incur charges of approximately $28 million for severance benefits, contract terminations, and write-offs. The company is making these moves to simplify its business structure, moving away from areas that have not been profitable and enhancing financial controls. SunPower’s Principal Executive Officer Tom Werner explained these decisions in a letter to employees, emphasizing the need to improve the company’s financial performance.
Overall, SunPower’s restructuring efforts are aimed at streamlining operations, cutting costs, and focusing on areas with higher profitability potential. By making these changes, the company hopes to position itself for long-term success in the competitive solar energy market.